The Week Ahead
CONSUMER PRICE INDEX Wednesday, Feb. 19, 8:30 a.m.EST -- Consumer prices of all goods and services probably increased by 0.3% in January, according to the median forecast of economists surveyed by MMS International, one of The McGraw-Hill Cos. That's the same considerable gain posted in December, but it mostly reflects higher food and energy prices. Crude-oil prices, however, have started to head lower in February, so prices of gas and heating oil may drop by spring. Excluding the volatile food and energy sectors, core prices probably increased by 0.2% last month, after edging up 0.1% in December. For all of 1996, total consumer prices increased by 3.3%, the first time in six years that inflation picked up. Core prices, however, rose just 2.6% in 1996. That annual gain equaled the 1994 rate as the smallest inflation rate since 1965. INTERNATIONAL TRADE Wednesday, Feb. 19, 8:30 a.m.EST -- The MMS survey expects that the trade deficit for goods and services widened to about $9.5 billion in December, after the gap narrowed sharply to $8 billion in October and $8.4 billion in November. The Commerce Dept.'s numbers on foreign trade in the fourth quarter added more than two percentage points to economic growth at yearend. In the first quarter, however, trade usually becomes a drag on growth, probably reflecting inaccurate seasonal adjustments. For December, exports, which rose to a record in November, probably edged lower. Imports, up 0.8% in November, increased again in December. HOUSING STARTS Thursday, Feb. 20, 8:30 a.m.EST -- New home construction probably stood at an annual rate of 1.4 million in January, says the MMS median forecast. That would be 5% above the 1.33 million started in December, but about even with the average of the entire fourth quarter. Cold weather and flooding probably dragged down December building activity. Starts in the West plunged 29% for the month.
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