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Business Week Ahead: Retail Sales, Industrial Production, Fed Minutes

Markets will focus this week on US retail sales and minutes of the Federal Reserve’s July 27-28 policy meeting.


China’s economic activity continued to slow in July, likely due to weakening base effects and extreme weather conditions that hampered the country’s service sector. Economists polled by the Wall Street Journal expect the country’s retail sales to grow 11.4% year over year, compared to a 12.1% increase in June. Industrial production was likely up 7.8% yoy in July and slowed from 8.3% in June. China’s non-rural fixed investment – a metric that measures investment in factories, railways, and new homes – is also likely to have declined, despite government attempts to boost infrastructure investment.


US retail sales are expected to decline slightly in July. Economists predict a burden from weaker auto sales, caused in part by supply chain issues with limited dealer inventory. It’s less clear whether a spike in Covid-19 cases during the month had a noticeable impact on household spending.

U.S. industrial production – a measure of the output of factories, mines, and utilities – is expected to increase in July. Manufacturing, the largest component of the index, stands between strong demand for products and an unreliable supply of materials and labor.


Housing starts in the US are likely to have cooled off in July. Home builders have ramped up housing in response to robust demand, but are faced with rising material prices, difficulties in attracting enough labor, and limited availability of buildable land.

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