There will be a wealth of data released this week. Most of it is expected to reflect a stronger economic environment than the first six months of the year. Second quarter Real GDP will be revised from the 2.6% increase reported in the Advance report. This revision is expected upward to 2.8%. We are expecting better than 3% due to higher consumer spending, a lower trade deficit and a better housing sector in June than was estimated in the Advance Report. The housing data released last week did revise both May and June upward, even as the July sales data was lower than expected. Personal spending due out this week is forecast to be much higher in July than the June data, indicating a solid start to the third quarter.

Consumer confidence, due out tomorrow, is expected to remain at near record highs and the jobs data due out on Friday is forecast to remain solid after very strong growth reported for June and July. The one area not expected to change is the lack of inflation. The core rate for the PCE price index was only 0.1%, keeping the year-over-year increase at 1.4%. This is down from 1.9% for all of 2016. Wage rates are not increasing at a rate reflective of the tight labor markets. Wages have increased by 2.5% over the last year…

ProBank Austin Advisor – August 28, 2017