This week is shaping up to be relatively calm due to the holiday season, yet it still features several important economic releases that could shape investor sentiment. The spotlight will be on the third-quarter GDP figures and the December consumer confidence survey, both of which offer insight into the current state of the US economy. n nPersistent uncertainty lingers from earlier government disruptions, which continue to affect the reliability of economic data entering the new year. While recent employment figures suggest a stronger labor market than anticipated, their credibility remains under scrutiny. This skepticism extends to other recently published datasets, including November’s inflation report. The 2.7% year-over-year increase, though lower than expected, has raised concerns about data integrity following the shutdown. n nInvestor sentiment during this shortened trading week remains cautious. Signs of resilience or optimism could boost equities, especially as market participants assess corporate investments in artificial intelligence and speculate on the Federal Reserve’s potential policy shifts in 2026. n nFirst, real GDP expanded at an annualized rate of 3.8% in Q2. Analysts anticipate a solid 3.5% growth rate for Q3, to be released on Tuesday, which would indicate that economic momentum is holding steady. This projection aligns with estimates from the Atlanta Fed. n nSecond, with official government reports delayed or inconsistent, private-sector surveys are gaining importance. The Conference Board’s consumer confidence index, also due Tuesday, serves as an early gauge of labor market conditions. A mixed reading is expected, reflecting ongoing uncertainty in employment trends. n nThird, weekly jobless claims, reported Wednesday, continue to act as a reliable indicator amid data gaps. Following last week’s 224,000 filings, a slight decline is anticipated, potentially supporting a drop in the unemployment rate from November’s 4.6% to a lower figure in December. n nLastly, regional Federal Reserve surveys will provide additional context. The Chicago Fed National Activity Index for November arrives Monday, followed by the Richmond Fed’s December business conditions survey on Tuesday. Despite challenges in interpretation due to limited federal data, the Richmond report may reinforce positive signals seen in earlier regional reports from New York, Philadelphia, and Kansas City. n
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Economic Week Ahead: GDP, Consumer Confidence in Focus Amid Holiday Calm
This looks to be a mercifully quiet holiday week that nonetheless offers a smattering of key data releases. Chief among them will be Q3’s and December’s Index survey. n nClearly, the economic fog caused by the government shutdown is following the markets into the new year. Though recent employment data have been illuminating—showing that the labor market may be a bit more robust than many expected—their quality is questionable. The same can be said of other recently released key data series. n nLast week’s release for November is another foggy one. While nice to have, the lower-than-expected 2.7% y/y increase raised fresh questions about the reliability of post-shutdown data. n nInvestors are also uncertain about the year-end stock rally in this shortened Christmas week. Any signs of holiday cheer could go a long way on Wall Street as investors scrutinize massive corporate spending on AI and shifting perceptions about when—and whether—Powell & Co. might ease again in early 2026. n nHere’s a look at some data reports that might influence the Fed’s views on how the US is exiting a uniquely chaotic year: n n1. GDP update n nReal GDP rose 3.8% (saar) during Q2. We expect a reasonably robust 3.5% Q3 GDP report (Tue) to confirm that economic growth remains robust. This would be consistent with the Atlanta Fed’s estimate (chart). n n2. Consumer confidence n nWith government data still trickling in—and at times offering mixed signals—private surveys are filling the void as rarely before. The Conference Board’s Index survey (Tue) is a case in point. It provides the earliest monthly lead on the labor market. We expect it to confirm that job market conditions remain mixed (chart). n n3. Jobless claims n nAmid the statistical fog, the level of for unemployment insurance (Wed) remains something of a beacon for perplexed investors. The latest reading (following last week’s 224,000 level) should show, once again, that layoffs remain low, suggesting that a slight decline could follow November’s 4.6% in December (chart). n n4. Regional Fed surveys n nThe week opens with the Chicago Fed’s (Mon) for November. That’s followed a day later by the Richmond Fed’s business survey (Tue) for December. Though the regional Fed bank surveys have faced their own challenges as government data have gone quiet, this week’s Richmond update may confirm the solid December employment reports from the NY, Philly, and Kansas City Feds (chart).