Broadly encouraging price data

Last week’s economic data were encouraging with regard to inflation. All three measures of prices reported last week (CPI, PPI, and import prices) were either unchanged or experienced negative growth, primarily due to a large decline in energy prices. Even excluding food and energy, however, price growth was slower than the recent norm. Elsewhere, small business optimism is hovering just above a 10-year low, attributable in large part to inflation challenges and recession fears.

What we learned last week: (pg. 1)

• No change in consumer prices
• Modest upward movement in small business optimism

What we’re watching this week: (pg. 2)

• Weak permit activity weighs on housing starts
• Retail sales likely to rise again
• Existing home sales to cool further

View our informative commentary on the economy and financial markets – and find out what we’re watching for the week ahead: