The Week Ahead
EMPLOYMENT COST INDEX Tuesday, Jan. 27, 8:30 a.m. EST -- Employment costs for civilian workers probably increased 0.8% in the fourth quarter, the same gain posted in the third period, according to the median forecast of economists surveyed by MMS International, one of The McGraw-Hill Companies. The small advance would mean that compensation costs rose 3% in 1997, just slightly above the 2.9% growth in 1996. However, if the monthly data on hourly wages are any guide, the wage and salary component of the ECI may have increased by at least 1% last quarter, even as benefit costs remained tame. That would push the overall ECI higher. With labor markets tight, compensation costs are likely to post bigger gains in 1998, putting the squeeze on profit margins. CONSUMER CONFIDENCE Tuesday, Jan. 27, 10 a.m. EST -- The Conference Board's index of consumer confidence probably slipped to 132 in January, after jumping more than six points in December, to 134.5. DURABLE GOODS ORDERS Wednesday, Jan. 28, 8:30 a.m.EST -- Durable goods orders likely fell 2.3% in December, says the MMS forecast. In November, new bookings unexpectedly jumped 4.8%, led by an increase in airplane orders. Excluding aircraft, demand for durable goods dropped in both October and November. REAL GROSS DOMESTIC PRODUCT Friday, Jan. 30 8:30 a.m. EST -- The median MMS forecast projects that real gross domestic product grew at an annual rate of 3.5% in the fourth quarter, after a 3.1% advance in the third period. If so, then the economy grew at a robust 3.7% pace for all of 1997. Consumer spending increased moderately last quarter, while foreign trade and housing most likely added some muscle to fourth-quarter output. Inflation, as measured by the GDP price index, probably stood at an annual rate of 1.6% in the fourth quarter, up from 1.4% in the third.
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