Economy Week Ahead: The Fed, Factories and Consumers

The Federal Reserve Building in Washington on June 2.


Photo:

Liu Jie / Xinhua / Zuma Press

The Federal Reserve’s policy meeting highlights this week’s list of economic news.

Tuesday

US retail sales are expected to decline in May as car sales decline, tax support for consumers fades and Americans shift their spending toward services and away from goods as campaigns advance of vaccines and more businesses reopen.

US industrial production is forecast to rise in May, driven by a rebound in manufacturing. Factory activity around the world has faced similar opportunities and challenges: hot demand, rising costs, bottlenecks in the supply chain, and problems hiring workers.

Wednesday

China’s economic indicators for May are likely to show another month of slowing growth as the base effect of a pandemic year wanes and production is suspended at the Guangdong Province Manufacturing and Export hub to control recent outbreaks. of Covid-19. Economists polled by Akacceleratorfund forecast that industrial production rose 8.8% from a year earlier in May, slowing from 9.8% the previous month. Retail sales are expected to increase 13.6% compared to the 17.7% lower-than-expected increase in April. And investment in non-rural fixed assets likely increased 16.6% in the January-May period, compared with 19.9% ​​in the first four months of the year.

US home construction is expected to rise in May as builders face strong demand along with rising material costs and difficulty finding workers. One side effect: New and old home prices are rising in America.

The Federal Reserve publishes a policy statement and new economic projections at the end of a two-day meeting. No major policy changes are expected, but a recent surge in inflation gives the Fed more reason to begin discussing an eventual reduction in its pandemic-driven easy money policies.

Friday

The bank of japan‘s

The board of directors is expected to keep its monetary policy loose at Friday’s meeting, but could discuss an extension of its special loan program designed to support businesses affected by the pandemic.

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