This week is rather light on economic data, so earnings warnings and political tensions will likely have a more significant impact on markets.

That said, CIBC World Markets says that this week’s economic data “will feed into the impression that economic activity is on a more solid footing north of the 49th parallel.”

There’s manufacturing shipment data on Tuesday, wholesale trade numbers on Wednesday, and trade balance and retail trade numbers on Thursday. CIBC says that factories and retailers “both looked to have posted robust monthly gains in May on the heels of disappointing figures for April, and a pick-up at the plant gate should also flow through to export shipments.”

BMO Nesbitt Burns says that. “A snap-back in auto production is likely to boost April results for manufacturing shipments, exports, and wholesale trade, after all three fell in March. Overall, after posting minimal growth in March, the economy looks set to post a solid GDP result for April.”

Apart from the data, Ontario delivers a provincial budget on Monday. Also, the new federal Finance Minister John Manley will also give an economic update to the Commons Finance Committee. “In last December’s budget, the government called for a balanced budget this year, but based that call on GDP growth of just 1.1% in 2002,” says BMO. “The consensus is now looking for at least 3% growth this year. The sudden and dramatic improvement in the economic backdrop has given a charge to the revenue outlook, and raised the prospect of a wave of new spending measures.”

CIBC suggests that the data will keep markets guessing about whether the Bank of Canada will deliver a 25 basis-point hike, or 50 bps, in July. “In our view that decision will be much more dependent on the next employment report, and on the state of financial markets over the coming weeks.”

In the U.S., consumer inflation and housing starts data are due out on Tuesday. Thursday will bring its leading indicator. “The coming week’s CPI data will largely be a sideshow, as the numbers are unlikely to change expectations for a stand-pat Fed over the summer months,” says CIBC. “It’s still largely a story of equity market woes trumping economic data, although the past week’s figures on retail sales and consumer sentiment leaned in the same direction as stocks.”

BMO agrees that there is nothing coming out next week, data-wise, that is likely to change the picture of weak recovery in the U.S. “Anyway, what really matters for the market are the tape bombs — both terrorism and corporate malfeasance varieties. Equity markets have built up a head of steam on the downside. So, unless that stops, economic news will pass nearly unnoticed.”