The Business News Week Ahead

An upgrade for the consumer was the news of the FOMC at mid-month and Friday's personal income and consumer spending report will offer the final verdict for May. Housing is close to the consumer and the week offers key indications beginning on Monday with new home sales, which have been strong, and pending sales of existing homes on Wednesday which have been weak. The search for indications on tariff and trade-war effects will be Wednesday's focus with international goods trade and durable goods orders both posted. Also posted will be jobless claims and the third estimate for first-quarter GDP, these are out on Thursday.

Monday

National Activity Index for May

Consensus Forecast: 0.37

Consensus Range: 0.30 to 0.65

After slowing at the outset of the year, the national activity index is back at its expansion best, posting 0.34 in April and 0.32 in March to indicate well above average growth. Though employment will give a boost to May, weakness in industrial production may hold the index back. Consensus for May is a further gain to 0.37.

New Home Sales for May

Consensus Forecast, Annualized Rate: 665,000

Consensus Range:  655,000 to 700,000

Beneath uneven monthly results is a solid upward trend for new home sales which are expected to accelerate very slightly in May to a 665,000 annualized rate vs 662,000 in April. Housing completions have been coming into the market which should help sales as should relative price weakness for new homes.

Dallas Fed General Activity Index for June

Consensus Forecast: 27.0

Consensus Range: 22.0 to 33.6 

Dallas is among the very strongest of the regional reports with new orders and production both at 12-year highs, with capacity utilization elevated and with price readings highly elevated. Another month of unusual strength is expected for June, at a consensus 27.0 and up slightly from May for the general activity index.

Tuesday

Case-Shiller, 20-City Adjusted Index for April

Consensus Forecast, Month-to-Month Change: 0.5%

Consensus Range: 0.3% to 0.6%

Case-Shiller, 20-City Unadjusted Index

Consensus Forecast, Month-to-Month Change: 0.8%

Consensus Range: 0.2% to 0.8%

Case-Shiller, 20-City Unadjusted Index

Consensus Forecast, Year-on-Year Change: 6.8%

Consensus Range: 6.6% to 7.0%

Home-price appreciation has been strong but appeared to slow going into the Spring selling season. Renewed strength is the call for April's Case-Shiller data where the consensus gain for the 20-city adjusted index is a solid 0.5 percent with the unadjusted year-on-year rate seen holding at 6.8 percent. The consensus for unadjusted monthly growth, reflecting the relative strength of April compared with other months of the year, is 0.8 percent.

Consumer Confidence Index for June

Consensus Forecast: 128.1

Consensus Range: 125.8 to 130.0

Econoday's consensus, at 128.1 in May, is calling for steady strength at a high level for the June consumer confidence index. Job assessments, both current and future, have been extraordinarily strong in this report.

Richmond Fed Manufacturing Index for June

Consensus Forecast: 16

Consensus Range: 14 to 16

Gains for new orders and a build for backlogs in May point to strength for the Richmond Fed's manufacturing index in June, at a consensus 16. This report has been showing less strength than other regional reports though hints of overheating are nevertheless apparent including acceleration for input prices.

Wednesday

Durable Goods Orders for May

Consensus Forecast, Month-to-Month Change: -0.6%

Consensus Range: -2.4% to 1.2%

Durable Goods Orders, Ex-Transportation

Consensus Forecast: 0.4%

Consensus Range: -0.3% to 1.3%

Durable Goods Orders, Core Capital Goods (Nondefense Ex-Aircraft)

Consensus Forecast: 0.2%

Consensus Range: -0.2% to 0.5%

Another month of underlying growth is the call for durable goods orders which however, based on expectations for aircraft orders, is forecast to show a headline decline of 0.6 percent. Ex-transportation orders are expected to rise 0.4 percent in May. Strength in core capital goods orders was a major plus in the April report and a modest 0.2 percent add-on gain is the May consensus.

International Trade In Goods for May

Consensus Forecast, Month-to-Month Change: -$69.0 billion

Consensus Range: -$69.8 to -$65.0 billion

The goods deficit is expected to widen to a consensus $69.0 in May vs $67.3 billion in March (revised from an initial $68.2 billion). May's report will update progress on second-quarter net exports and offer the latest on the bilateral deficit with China.

Advance Wholesale Inventories for April

Consensus Forecast, Month-to-Month Change: 0.3%

Consensus Range: 0.0% to 0.9%

Wholesale inventories are expected to rise 0.3 percent in May after rising 0.1 percent in April. Relative to sales, wholesale inventories have been low.

Pending Home Sales Index for May

Consensus Forecast, Month-to-Month Change: 0.7%

Consensus Range: -0.5% to 2.0%

Pending home sales are expected to increase 0.7 percent in May after dropping 1.3 percent rise in April. This index has been accurately forecasting what are flat results for the existing home sales report.

Thursday

Real GDP: 1st Quarter, 3rd Estimate, Annualized Rate

Consensus Forecast: 2.2%

Consensus Range: 2.0% to 2.4%

Real Consumer Spending, Annualized Rate

Consensus Forecast: 1.0%

Consensus Range: 0.7% to 1.1%

GDP Price Index

Consensus Forecast: 1.9%

Consensus Range: 1.9% to 1.9%

The third estimate for first-quarter GDP is expected to come in at a 2.2 percent annualized rate, unchanged from the second estimate. Consumer spending is also expected to come in unchanged, at a 1.0 percent rate. The GDP price index is likewise seen unchanged at 1.9 percent.

Initial Jobless Claims for June 23 week

Consensus Forecast: 220,000

Consensus Range: 219,000 to 225,000

Initial claims are expected to come in at 220,000 in the June 23 week vs 218,000 in the prior week. All readings in this report are at or near historic lows and consistent with strong demand for labor.

Friday

Personal Income for May

Consensus Forecast, Month-to-Month Change: 0.4%

Consensus Range: 0.3% to 0.5%

Consumer Spending

Consensus Forecast, Month-to-Month Change: 0.4%

Consensus Range: 0.3% to 0.5%

PCE Price Index

Consensus Forecast, Month-to-Month Change: 0.2%

Consensus Range: 0.2% to 0.3%

PCE Price Index

Consensus Forecast, Year-on-Year Change: 2.2%

Consensus Range: 2.2% to 2.3%

Core PCE Price Index

Consensus Forecast, Month-to-Month Change: 0.2%

Consensus Range: 0.2% to 0.3%

Core PCE Price Index

Consensus Forecast, Year-on-Year Change: 1.9%

Consensus Range: 1.9% to 2.0%

Personal income is seen rising a moderate to solid 0.4 percent in May while consumer spending, in what will be the second major input into second-quarter GDP, is expected to also increase 0.4 percent. The core PCE price index, which excludes both food and energy and which is the most closely watched of all inflation readings, is seen posting a modest 0.2 percent monthly rise for a year-on-year gain of 1.9 percent and very close to the Fed's target for 2 percent. The consensus for the overall price index is also 0.2 percent for a year-on-year rate of 2.2 percent.

Chicago PMI for June

Consensus Forecast: 60.1

Consensus Range: 58.6 to  63.0

Easing strength at a high level is the call for the Chicago PMI with the June consensus at 60.1 vs 62.7 in a May report that showed gains for both new orders and backlogs. This sample has had trouble filling open positions and has been reporting delivery delays and rising costs, all consistent with capacity stress.

Consumer Sentiment Index, Final June

Consensus Forecast: 99.2

Consensus Range: 98.0 to 99.5

Expected to hold near the preliminary reading, the final consumer sentiment index for June is expected to come in at 99.2. The preliminary report proved much stronger than expected and included a rise in buying plans for durables. Year-ahead inflation expectations in this report had been flat but moved higher in the last report.