The Week Ahead

PRODUCTIVITY AND COSTS
      Tuesday, Nov. 7, 10 a.m. -- Output per hour worked probably rose at a strong 
      annual rate of 2.5% in the third quarter. Output in the nonfarm sector likely 
      rose strongly, as suggested by the 4.2% advance in the real gross domestic 
      product, while hours worked likely increased by less than 2%. Nonfarm 
      productivity surged at a 4.8% annual rate in the second quarter. Greater 
      efficiency, along with the mild rise in compensation, indicates that unit labor 
      costs probably increased at a 0.5% pace last quarter. Labor costs fell at a 
      1.1% pace in the second quarter and stood no higher than they were in the 
      second quarter of 1994. That lack of cost pressures at nonfarm businesses is 
      why inflation has been so low in this expansion. Productivity has been greatest 
      among manufacturers.
      
      INSTALLMENT CREDIT
      Tuesday, Nov. 7, 3 p.m. -- Consumers probably took on $8.6 billion more in 
      credit than they paid off in September. That's the median forecast of 
      economists surveyed by MMS International, one of The McGraw-Hill Companies. The 
      growth in debt has slowed a bit during the summer, after exploding in the first 
      half of the year. In August, credit rose $9.1 billion, compared with the nearly 
      $12 billion averaged in the second quarter. The slowdown reflects weaker car 
      sales as well as the fact that some households are beginning to bump up against 
      their credit limits. Nationally, installment debt as a percent of disposable 
      income stood at a high 18.8% in August.
      
      PRODUCER PRICE INDEX
      Thursday, Nov. 9, 8:30 a.m. -- The MMS survey forecasts that producer prices of 
      finished goods likely rose by just 0.1% in October, after a 0.3% increase in 
      September. Prices, excluding the volatile food and energy sectors, also are 
      expected to post an October rise of 0.1%, on top of a 0.2% increase. Inflation 
      at the producer level is almost nonexistent. Prices are rising at less than 2% 
      for all items, and 2.1% excluding food and energy.
      
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