Canadian market watchers will be able to keep their attention focused at home, with a heavy slate of economic data releases here this week, and a light calendar in the United States.

RBC Capital Markets says that next week is loaded with important economic data that will be carefully monitored by the markets.

“Building permits data for January will be released on Monday and February housing starts will come out on Tuesday. Fourth-quarter labour productivity and capacity utilization data are scheduled for release on Thursday,” it reports, adding, “Friday will undoubtedly be the biggest day of the week with the release of the January trade data along with the February employment data.”

“Large deviations from expectations of either of Friday’s key releases can elicit a sharp response by the financial markets,” RBC says.

CIBC World Markets cautions that employment growth should only see a “half-hearted rebound after January’s surprise dip” BMO Nesbitt Burns calls for Canadian payrolls look to rebound in February from a decline of 5,700 in the prior month. It expects payrolls to post a 15,000 increase. However, it warns that both manufacturing and construction employment could retreat.

“A few other things to watch in the jobs report: the unemployment rate has held fast at 7.0% in the past two months, just barely above the 25-year low of 6.7% it reached in mid-2000; the participation rate has been gradually fading since hitting a record high of 67.7% just over a year ago; and, the employment-to-population ratio has slipped a tick after reaching a record high of 62.8% last year,” BMO notes.

“January’s trade balance should be part of a first quarter improvement tied to better prices for resources and perhaps some efforts to clear out bloated inventories, but real production for export will remain a weak link in the economy in 2005,” CIBC says.

BMO Nesbitt is looking for moderate gains in both exports and imports, and some further narrowing in the surplus; and it expects housing starts to snap back with an 8% rise to 220,000 units.

In the U.S., next week’s releases include initial jobless claims and January wholesale trade on Thursday, RBC says. And, the trade balance for the month of January will be released on Friday.

CIBC predicts that the quiet week for data “will see the focus on one of America’s twin deficits”.

“Higher oil and other import prices and an insatiable appetite for imported consumer goods should see the trade gap look ugly again, even if, as we expect, real exports see some life. Watch for downward pressure on the greenback as a result,” it says. “The Beige book will call attention to decent US economic growth in Q1, and only moderate signs of price pressures, a backdrop for further measured quarter point hikes from the central bankers in March, May and June. That shouldn’t bother a bond market that has all three of these hikes fully priced in.” BMO Nesbitt expects the trade deficit to remain roughly unchanged in January, in the $56 billion range, and the federal budget deficit to remain roughly unchanged in February, in the $96 billion range.

“Keep an eye on weekly jobless benefit claims for clues on whether February’s healthy labor market trends are persisting into March. Crude oil prices will also remain a focal point, given their recent rebound,” CIBC adds.

On the earnings front, TLC Vision Corp. and Wheaton River Minerals report on Monday. Tuesday brings news from Geac Computer, Linamar Corp., and Sobeys Canada Inc.

On Wednesday, Aber Diamond Corporation reports, as does Dorel Industries, Hudson’s Bay Company, IamGold and Zenon Environmental Inc.

Thursday we’ll hear from Biovail Corporation, Husky Injection Molding Systems, MDS Inc., Micrologix Biotech, Sleeman Breweries Ltd., and SMTC Corporation.