Next week sees a decision on interest rates in Canada and the release of a slew of economic data in the U.S., but earnings and scandals are expected to dominate traders’ attentions once again.

The Bank of Canada is widely expected to hike rates another 25 basis points on Tuesday morning to 2.75%. Some economists have suggested that 50 bps could be in the cards, but weak equity markets and fear of getting too far ahead of U.S. rates has others suggesting that this rate hike may be the last one for a while.

TD Bank economists say that 25 bps is a certainty next week, so markets won’t care. BMO Nesbitt Burns says, “While the odds favour a rate hike, it is not quite the done deal that it appeared to be after last week’s blow-out Canadian employment report. The economic data in Canada remain relentlessly strong, but equity markets remain relentlessly weak.” At least, the cross-currents should prevent a 50 bps hike, says BMO. It says the Bank is likely to stick to its tightening program “even in the face of a vicious bear market” because of strong growth, lots of new jobs, a hot housing market and building inflation.

CIBC World Markets says that earnings will matter more next week anyway. “More than this as-expected rate hike, markets could take their cue from the latest news on corporate earnings.”

Apart from the rate call on Tuesday, there will be manufacturing shipment data on Wednesday and trade balance numbers on Friday. CIBC says that data on factory shipments and merchandise trade will help shape the outlook for May GDP. “While those reports could prove mildly disappointing, second-quarter growth is still setting up for another stellar showing, with headline growth expected to be twice that of the U.S.”

“A common theme among all those releases was a surge in auto production,” says BMO. “However, preliminary evidence suggests that auto assemblies tapered off in May (reversing about a quarter of the April jump), and accordingly we look for some pullback in all of the major reports next week.”

In the U.S., business inventory data is out Monday. Tuesday brings industrial production and capacity utilization numbers. On Tuesday, the U.S. Federal Reserve also presents its monetary policy statement to the Senate. On Wednesday the Fed repeats itself in the House of Representatives.

CIBC says that Fed chairman Alan Greenspan’s semi-annual monetary policy appearances and the ongoing deluge of earnings numbers will provide the key focus of the upcoming week. “Given the equity markets recent bumps — ‘irrational exuberance’ in reverse — and gloomier consumer, Greenspan may put a bit more emphasis on the risks still confronting the economy than in recent appearances. That could provide a modicum of support for bonds,” it says. And, “With no fewer than half of Dow members due to report earnings, and the possibility of more accounting shenanigans, the Fed chief will however have to talk loudly to relay his message.”

BMO suggests that Greenspan will go off on some tangent or other in order to avoid saying anything the markets would interpret as inflammatory about whether the economy is in trouble. “We don’t expect any hint from the chairman that the economy is out of the woods. The all-clear signal isn’t likely to sound before this fall, at the earliest,” it says.

Housing start data is also out on Wednesday. Thursday brings the U.S. leading indicator. And on Friday, consumer inflation numbers are out. BMO says that the U.S. economic data are likely to continue to show that, “the factory sector is on the mend, housing activity is on a high plateau, that the trade gap remains terrible, and, hopefully, that core CPI is not accelerating, as some fear. But the data are far less important than Greenspan and equities.”

As for corporate earnings, Alcan reports on Tuesday, joined by Jean Coutu Group, Sears Canada Inc. and TimberWest.

Acetex Corp., Celestica, IBM, Methanex Corp. and Shoppers Drug Mart Corp. report on Wednesday.

Aliant Inc. is due to talk on Thursday, along with Legacy REIT, Microsoft, Nokia, Nortel and TransAlta Corp.

Cott Corp. is the only notable name scheduled for Friday.