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The Week Ahead


Business Outlook

THE WEEK AHEAD

PRODUCTIVITY AND COSTS

Tuesday, Aug. 10, 10 a.m.

Output per hour worked in the nonfarm sector likely fell at an annual rate of 1.5% in the second quarter, after dropping by 1.8% in the first period. That's the median forecast of economists surveyed by MMS International, a division of McGraw-Hill Inc. Last quarter, total hours worked probably rose at about a 4.1% annual pace, while nonfarm output, as indicated by the gross domestic product, grew by less than 2%. If the forecasters are right, it would be the first two-quarter drop in productivity in more than two years. The efficiency slump, along with a rise in compensation, probably means that unit labor costs grew at an annual rate of about 5%, the same as the first-quarter pace.

PRODUCER PRICE INDEX

Thursday, Aug. 12, 8:30 a.m.

Producer prices of finished goods were likely unchanged in July, after falling 0.3% in June. Lower energy prices offset increases elsewhere. Excluding food and energy, producer prices probably rose 0.2% in July, after falling 0.1% in June.

RETAIL SALES

Thursday, Aug. 12, 8:30 a.m.

Weak car buying probably meant retail sales increased little in July, says the MMS survey. But excluding cars, receipts probably rose a respectable 0.4%, despite a drag in shopping caused by the floods in the Midwest and the heat wave in the East. In June, total sales advanced 0.4%, and 0.2% excluding cars.

CONSUMER PRICE INDEX

Friday, Aug. 13, 8:30 a.m.

Consumer prices likely edged up 0.2% in July, as inflation continues to moderate. In June, prices were unchanged from May. The expected July increase means the yearly inflation rate would dip below 3% for the first time in 18 months.

BUSINESS INVENTORIES

Friday, Aug. 13, 10 a.m.

Business inventories probably fell by 0.1% in June, after rising 0.2% in May. Strong car buying last quarter helped to clear out car dealers' lots.JAMES C. COOPER AND KATHLEEN MADIGAN


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