The December 19 week has a busy schedule of data releases leading up to the holiday weekend. It includes a few adjustments as private and government releases are pushed up to get them out of the way before the following week. The Conference Board’s consumer confidence index at 10:00 EST on Wednesday (normally the last Tuesday of the month) is the most atypical timing. The Chicago Fed’s national activity index is set for 8:30 EST on Thursday (more usually the last Monday of the month). The Commerce Department’s reports for the third estimate of third quarter GDP and November’s data on personal income and spending are a few days earlier than usual at 8:30 EST on Thursday and Friday, respectively.
Given the proximity of the winter holidays and approach of year-end, most of the economic data will be quickly reviewed and digested. Expectations for sluggish GDP growth in the fourth quarter are in place and the week’s data shouldn’t change that outlook. Potential market-movers are few.
The most compelling numbers could prove to be for the housing sector. The recent declines in mortgage rates and moderation in home prices may have spurred some construction and buying activity. The December NAHB/Wells Fargo housing market index at 10:00 EST on Monday probably will remain near the weak 33 reading in November. However, this report looks at single-family home construction, not multi-unit building. The dip in mortgage rates means that renters facing rent increases in the near future may be looking to buy instead to lock in monthly housing costs. Data on housing starts and building permits in November at 8:30 EST on Tuesday may show that demand for multi-unit homes is keeping activity from fading as much as it might.
Sales of existing homes in November at 10:00 EST on Wednesday and new single-family home sales for November at 10:00 EST on Friday may be softer than October. Home resales are for contracts closed on single-family and multi-unit properties. These may be down because of homebuyer reluctance to take on the higher mortgage rates in October. New home sales are for contracts opened for single-family units. Demand for single-family homes is down which leaves a question about conditions in the multi-unit sector.
Not that this late in the fourth quarter, the release of the final estimate of third quarter GDP will be a nonevent. Markets are focused on how the current quarter will shape up after a weak November retail sales report and if businesses continue to invest and produce despite inflation and worries about a recession.
