This week, the Federal Reserve holds its second policy meeting of the year in Washington. The meeting is likely to be a closely watched one, following speculation about when the Fed will begin to withdraw its stimulus measures as the economy improves.
New reports on the housing market are also due out this week.
The National Association of Home Builders releases its housing market index for May. The index captures home builders’ views on the state of the market. Analysts expect it to rise a notch to 45, from 44. Numbers over 50 indicate a more positive outlook.
The consumer price index for May is released at 8:30 a.m. The index, which measures inflation, is projected to rise 0.2 percent. It saw a decrease of 0.4 percent in April following a drop in gas prices.
Housing starts data for May is out at 8:30 a.m. The number of housing starts is expected to rise 11.4 percent to 950,000. Last month, housing starts fell 16.5 percent, the most in five months, even though building permits touched a five-year high.
The Federal Reserve’s Open Market Committee kicks off its two-day meeting.
Following its meeting, the Fed releases a policy statement and its economic projections at 2 p.m. Analysts expect the Fed to leave interest rates unchanged. At its March meeting, the Fed had said it would “closely monitor” the state of the economy in the coming months. Markets had a volatile week as investors wondered when the Federal Reserve would end its stimulus.
Fed Chairman Ben S. Bernanke holds a press conference at 2:30 p.m.
Weekly jobless claims are expected to rise to 340,000, from 334,000 last week.
Analysts expect existing home sales for May to reach 5 million, up from 4.97 million last month. The housing market continues to face an inventory shortage as the supply of homes is slow to keep up with demand.