Mon 23 Dec (13:30). Personal Income/Spending (Nov). Personal income is expected to have grown by around 0.6% in November, reflecting higher wages and salaries growth last month. Personal consumption is expected to have grown less strongly, by around 0.2%. However, the key month for consumption is December, with spending expected to accelerate quite strongly in the run up to Christmas.
Thurs 26 Dec (15:00). Existing Home Sales (Nov). Sales fell in each of the five months to October, and there is some anticipation of a reversal in this trend following the recent decline in mortgage interest rates.
Fri 27 Dec (13:30). Durable Goods Orders (Nov). The volatile nature of this series limits its usefulness. Aircraft orders should have boosted orders last month.
Tues 31 Dec (15:00). Consumer Confidence (Dec). Sentiment has deteriorated from the very high levels reached at the end of the Summer, although at 107.3 in November is still fairly respectable. It is likely that stronger spending in the pre-Christmas period could lift the level of confidence once again.
Tues 31 Dec (15:00). New Home Sales (Nov). Like other measures of housing sector activity, a reversal of the recent negative trend is expected.
Thurs 2 Jan (15:00). National Purchasing Manager's Survey (Dec). November's survey showed improved sentiment, with the index rising from 52.7 to 50.2. Analysts will be looking for a further boost to production, orders and employment in December, especially given the end to the GM motors strike.
The Week Just Past
Industrial production rose quite sharply in November, up 0.9% m-on-m. The rebound partly reflected the return to work of GM workers following a strike, although there was also a strong gain in output among other manufacturers. The capacity utilisation rate also picked up to 83.3%.
Housing starts jumped 9.2% in November, following declines in the previous two months. These figures suggest a rebound in US housing sector activity, boosted by a steep fall in mortgage rates over the last few months. Building permits for house construction, a useful guide to future building trends, increased 3.9% in November, the largest gain for a year.
The treasury market fell on the news, which came on the same day as the regular monthly monetary meeting of the FOMC.
US interest rates were left on hold at the meeting, as anticipated, although sentiment about monetary policy may change if activity data strengthens into 1997.
The trade deficit narrowed much more significantly than expected in October, falling from $11.4bn to $8.0bn. Exports grew by 4.2% while imports fell 0.7%. Economists saw export strength as a positive for fourth quarter GDP, and for the US$.