The Week Ahead
VEHICLE SALES Wednesday, Sept. 6 -- Sales of domestically made cars and light trucks probably stood at an annual rate of 12.3 million in August, according to the median forecast of economists surveyed by MMS International, one of the McGraw-Hill Cos. Although some auto makers will disclose their sales earlier, the data for total sales will have to wait until others, including Ford Motor Co., report on Sept. 6. The expected August sales pace would be a rebound after the year's steady decline in vehicle purchases. In July, sales fell a steep 6.3%, to a pace of just 11.9 million, even though many carmakers offered rebates and other incentives. The sales downtrend lifted auto inventories and caused a drop in production, which has accounted for two-thirds of the drop in factory output since March. UNEMPLOYMENT CLAIMS Thursday, Sept. 7, 8:30 a.m. -- New filings for state unemployment benefits during the week ended Sept. 2 will probably fall to about 310,000. Claims had picked up in July, going above 400,000 in the second week. The rise partly reflected auto-plant shutdowns, which pushed up filings in that month. But jobless claims have fallen back since then, with only 348,000 in the week ended Aug. 19. Still, claims remain at a high level, given the tightness of the labor markets. INSTALLMENT CREDIT Friday, Sept. 8, 4 p.m. -- The MMS survey forecasts that consumers probably took on $9.5 billion more in installment debt in July than they paid off. That would not be much different from the $9.6 billion added in June, but the increases in both months are much slower than the $13.1 billion averaged in the three months ended in May. The July slowdown is suggested by the 0.1% drop in retail sales overall and the weakness in car purchases in particular. The recent surge in borrowing has lifted the ratio of installment debt to disposable income to 18.5% in June, near the record peak of the late 1980s. Revolving debt, which includes credit cards, is leading the runup.
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