Wednesday, December 12, 2012

Thursday: Retail Sales, Unemployment Claims, PPI

by Bill McBride on 12/12/2012 09:31:00 PM

The big story today was the Federal Open Market Committee (FOMC) of the Federal Reserve announcing thresholds for the unemployment rate and inflation that will guide Fed Funds rate policy in the future. I think this significantly improves Fed communication. Also the FOMC - as expected - announced that they will expand QE3 by $45 billion per month starting in January after the expiration of Operation Twist.

Going forward, the Fed will adjust the amount of monthly QE3 purchases based on their evolving economic outlook.

Thursday economic releases:
• At 8:30 AM ET, the initial weekly unemployment claims report will be released. The consensus is for claims to be unchanged at 370 thousand. The 4-week of claims should start to decline back towards the pre-Hurricane Sandy level.

• Also at 8:30 AM, Retail sales for November will be released. October retail sales (especially auto sales) were impacted by Hurricane Sandy, and auto sales bounced back in November. The consensus is for retail sales to increase 0.6% in November, and to be unchanged ex-autos.

• Also at 8:30 AM, the Producer Price Index for November will be released. The consensus is for a 0.5% decrease in producer prices (0.2% increase in core).

Another question for the December economic prediction contest (Note: You can now use Facebook, Twitter, or OpenID to log in).