Week of December 18 to December 22
Market News International compiles a market consensus that surveys 15 - 20 economists each week.

Tuesday
The international trade deficit on goods and services is predicted to narrow modestly to $33 billion in October from a $34.3 billion shortfall in September. Economists are looking for a slightly higher gain in exports than in imports, a reversal from the previous month. (Forecast range: $-32.0 to -$35.5 billion)

The FOMC is meeting. The market consensus is expecting that Fed officials will drop the inflation risk bias in favor of a neutral bias. This would be the first step in an easing process that would eventually lead to a drop in the federal funds rate target from the current level of 6.5 percent.

Wednesday
Economists are predicting housing starts will rise 0.5 percent in November to a 1.54 million-unit rate, the third monthly gain in this series. The sharp drop in mortgage rates may stem the downward trend in housing activity in the past few months. (Forecast range: 1.47 to 1.58 million) At the same time, housing permits are expected to rise a 1 percent in November to a 1.56 million-unit rate. (Forecast range1.51 to 1.56 million)

The federal budget is expected to show a deficit of $25 billion in November, the second month of this fiscal year. This would nearly match the monthly deficit for November last year, but would be higher than it was 2 years ago. For the fiscal year as a whole, economists are still predicting that the budget surplus will be larger than for fiscal year 2000. (Forecast range: $-20 to $-26 billion)

Thursday
Market participants are expecting new jobless claims to increase 20,000 in the week ended December 16 from last week's 320,000 level. This includes laid off auto workers. (Forecast range: -5,000 to +30,000)

The consensus forecast is calling for no revision to third quarter real GDP from the 2.4 percent figure reported last month. Final sales are expected to inch down to 2.5 percent for the July to September period. (Forecast range for GDP: 2.1 to 2.6 percent) Economists are also expecting that the GDP deflator will remain unchanged at 1.9 percent.

The Philadelphia Fed's business outlook survey is predicted to decrease modestly to 2.0 in December from a level of 5.2 in November. Any index level above zero means that manufacturing activity is expanding. This index tends to foreshadow the nation's index of industrial production. Thus, an increase in the business outlook survey would point to a slight gain in production for the month as well. (Forecast range: -5.0 to +4.0)

Friday
New orders for durable goods are expected to jump 1.6 percent in November after dropping 5.6 percent in the previous month. This is largely due to the volatile aircraft sector, although a drop in total transportation orders is likely given the scale back in auto production. Excluding transportation, new orders could post a moderate gain for the month. (Forecast range: 1.0 to 4.0 percent)

The consensus forecast is predicting personal income will rise 0.4 percent in November after dropping 0.2 percent in the previous month. As the farm subsidy payments work their way out of the system, income growth could go back to normal. (Forecast range: 0.2 to 0.5 percent) Personal consumption expenditures are expected to rise 0.3 percentage points in November, about the same rate as the previous month. (Forecast range: -0.1 to 0.4 percent)