This Week: Bernanke on Stress Tests, Economic Data
Well, that’s a relief. Last week was packed with economic news — Friday’s jobs report, Federal Reserve officials speaking, and most of all, results from the government’s stress test of banks.
All three turned out to be good for confidence. The jobs report wasn’t as bad as feared, Fed Chairman Ben S. Bernanke struck an optimistic tone on Capitol Hill, and the banks’ needs for capital were manageable. This week, we get a sense of how broadly those emerging signs of a bottoming in the economy are being felt.
Bernanke is scheduled to speak this evening at a conference in Georgia, about the just-completed stress tests of banks. There is a question-and-answer period planned afterward, which can yield more interesting insights than the prepared text.
Wednesday, the Commerce Department will report on April retail sales. Reports from major retail chains last week were a bit stronger than expected, and any theory that the recession will end later this year assumes that consumer spending will level off or start to climb a bit. That said, analysts are prepared for retail sales to have taken a slight dip, of 0.1 percent, in April; a positive number would be a pleasant surprise.
This Friday, the Fed reports on industrial production. The nations’ factories have been ground zero for economic decline, cranking out goods at far below their potential. Look for data Friday that confirm that this economic decline continues, but at a slower pace.
Analysts expect industrial production to have fallen 0.5 percent in April, compared with a 1.5 percent drop in March. That means that manufacturers will be producing at levels even further below their potential; capacity utilization is expected to drop to 68.9 percent, from 69.3 percent.
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