The Week Ahead
INDUSTRIAL PRODUCTION Monday, Dec. 16, 9:15 a.m.EST -- Output at factories, mines, and utilities likely bounced back by 0.5% in November, after dropping by a similar amount in October. That's the median forecast of economists surveyed by MMS International, one of The McGraw-Hill Companies, and is suggested by the gains in factory payrolls and overtime. The median forecast also expects that the average operating rate for all industries increased to 83% last month, from 82.7%. Factory output dropped in October because the strike at General Motors Corp. in Canada caused a shortage of auto parts. As a result, some GM plants in the U.S. closed, and vehicle production dropped off by 8.1%. HOUSING STARTS Tuesday, Dec. 17, 8:30 a.m.EST -- Ground was probably broken on new housing units totaling an annual rate of 1.39 million in November. That would be a small uptick from the 1.37 million housing starts in October. Starts fell a steep 6.1% in September, and another 5.1% in October. FOMC MEETING Tuesday, Dec. 17 -- The Federal Open Market Committee of the Federal Reserve Board will meet to set monetary policy for the next six weeks. All of the MMS economists expect that the Fed will leave the federal funds rate unchanged at 5.25%. The last policy move was in January, 1996, when the Fed cut a quarter of a percentage point from the fed funds rate, the overnight rate for interbank borrowing. INTERNATIONAL TRADE Thursday, Dec. 19, 8:30 a.m.EST -- The trade deficit for goods and services likely narrowed in October, to $10.3 billion. In September, the trade gap widened, to a larger-than-expected $11.3 billion. The MMS economists forecast that exports were unchanged after falling 1.4% in September. Imports probably fell after increasing for three months in a row. A deterioration in the U.S. foreign trade gap subtracted more than one percentage point from economic growth in the third quarter.
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