There’s a solid schedule of economic data releases due out this week, highlighted by Canada’s employment report for February.

Friday’s weak employment numbers in the U.S. may overshadow all the data released on that side of the border.

Canadian housing starts for February will be released on Monday, January’s trade balance is reported on Wednesday, Thursday brings capacity utilization numbers for the fourth quarter, and the February employment report is due out on Friday. Also, Bank of Canada governor David Dodge speaks in Brazil on Wednesday.

CIBC World Markets says that the Canadian employment data, “could mirror the U.S. reports by coming in on the disappointing side, with the economy still carrying a bloated workforce relative to the output being generated.”

“Canadian job growth looks to be simmering down again after the sprint in the final months of 2003. We look for payrolls to increase by another 15,000 in February, basically repeating January’s so-so performance,” says BMO Nesbitt Burns. It says that the unemployment rate is expected to hold steady at 7.4%.

“Our employment outlook for the year for Canada follows the ongoing theme of strength and stable labour market outcomes with forecasted employment growth of 1.9% and 1.4% for 2004 and 2005, respectively, with employment growth offsetting growth in the labour force, but not at the levels seen in the 1997-98 job boom,” says RBC Financial.

Looking at the rest of the week, Nesbitt is looking for the trade surplus to pull back to about $5 billion from the surprisingly sturdy $5.4 billion reading at the end of last year. It also says that housing starts could provide a significant upside surprise in February.

CIBC says that housing remains quite healthy. “Keep an eye on the Canadian dollar, which reverted to a strengthening trend after the soft US jobs numbers. An April rate cut grows more likely if the Bank of Canada needs it to keep the dollar from appreciating,” it says.

In the U.S., RBC reports that next week’s major data releases include January wholesale trade on Wednesday and weekly initial claims and February retail sales on Thursday. Friday completes the week with a flood of releases, including February import and export price indices, January’s trade balance, the March preliminary reading for the University of Michigan Consumer Sentiment Survey and January readings for business inventories and the producer prices index. Also, Fed chairman Alan Greenspan is speaking on Thursday.

CIBC says that retail sales should be generally healthy in February, and for the next several months, owing to large tax refunds. “Exports should see some of the momentum we’re observing in indicators of industrial sector activity. But after the past week’s employment reports, markets are going to be restrained in their enthusiasm for the economy, knowing it’s missing a key ingredient for longer-term sustainability. And concern about jobs will keep the Michigan sentiment figures near their recently cooled levels. That will keep as many eyes on the weekly jobless claims figures as on the monthly reports.”

Nesbitt says that Greenspan may reinforce the parade of comments about the inevitability of a rise in interest rates back to a neutral level. “It’s a perfectly safe time to do so since the bond market is fixated on the moribund U.S. labour market and will certainly not overreact to the Fed’s message with any upside move in bond yields. Other Fed officials have jumped on the Chairman’s bandwagon. So, we expect the nuanced flow of Fedspeak to be mostly on the hawkish side for awhile.”

There’s a modest lineup of companies expected to report earnings next week. Sleeman Breweries Ltd. reports on Monday.

Fort Chicago Energy Partners L.P. releases results on Tuesday.

Angiotech Pharmaceuticals, Linamar Corporation, MI Developments, Shiningbank Energy Income Fund and Thunder Energy Inc. report on Wednesday.

Hudson’s Bay Co. reports on Thursday. Friday brings earnings from Inex Pharmaceuticals Corporation.