It’s not an overly hectic week for economic news, but markets will probably take note of a few key indicators, particularly retail sales data for December and the Federal Reserve’s Beige Book, in order to gauge whether the recent uptick in the labor market is a sign of sustained growth or just a blip.
Throughout the week, analysts also are likely to pay close attention to public remarks by Fed officials outlining their views of the economy, for clues to what might happen at the Federal Open Market Committee’s meeting in late January.
The Fed’s Beige Book offers anecdotal evidence of economic conditions in the Fed’s 12 districts from late November through the beginning of 2012. Analysts expect the report to show slow-to-moderate growth across many parts of the country.
The Commerce Department releases its data on retail and food sales for December, offering a fuller picture of economic conditions during the holiday season. The expectations are that the numbers will show healthy growth: Recent estimates by Thomson Reuters found that last month’s retail sales rose 3.4 percent over those in 2010, slightly above forecasts. Overall, however, the retail sector is still on shaky ground.
Coming out at the same time, the Labor Department’s weekly release of data on claims for unemployment insurance should also be worth a look. For the past four weeks, new jobless claims have averaged 373,250 — under the crucial 400,000 mark and the lowest level since the first half of 2008. If that trend keeps up, it would be an optimistic sign for the job market.
The preliminary Reuters/University of Michigan Consumer Sentiment Index should provide clues to whether consumers are feeling any more upbeat about the U.S. economy now that the jobs market is getting better. One factor that could blunt consumer confidence is the recent increase in gasoline prices.
Meanwhile, analysts expect the Commerce Department’s international trade data to show that the U.S. trade deficit widened slightly in November, due to higher imports of holiday goods and a temporary increase in petroleum prices.
Central bank officials outline their views.
Commerce hopes to show whether holidays a win or a loss.