The Economic Week Ahead (August 15-19, 2022)

In the coming week, we will likely get more evidence of the US housing recession. However, the economic indicators and business surveys released this week should show that the rest of the economy is growing. July's FOMC minutes released on Wednesday might signal peak Fed hawkishness. Here’s more:

(1) Housing. July’s housing starts (Tuesday) will likely show weakening single-family, but solid multi-family starts. July's existing home sales (Thursday) should be weak with prices falling. Wednesday's mortgage applications (August 12 week) will probably show that the affordability problem is continuing to depress new purchase applications.

(2) Retail sales. July's employment report suggests that consumers' real incomes rose during the month, which might have boosted retail sales (Wednesday). Consumers still have about $1.5 trillion in excess saving and they've been charging more on their credit cards.

A weak report would suggest that consumers are still pivoting toward buying services rather than goods. If so, then June's manufacturing & trade inventories and sales (also on Wednesday) might show that retailers' inventories continued to swell.