IN a week laden with economic data, some have the potential to
surprise and upset financial markets, but the most eagerly awaited
information is the December retail sales figures, due on Wednesday.
All the pointers are to an upsurge, but analysts have not forgotten
that last year they were wrong-footed when after seasonal adjustment the
official figures yielded a sharp fall in volume.
At James Capel, Adam Cole is forecasting a rise of 0.4% in sales last
month taking the year-on-year growth rate up to 5.2%.
Other activity indicators include the Central Statistical Office's
first stab at GDP in the final quarter.
This is difficult to forecast ahead of today's figures on industrial
and manufacturing output for November, expected to show monthly
increases of around 0.5%.
Mr Cole has pencilled in GDP growth of 0.6% for the quarter and 2.4%
year-on-year. Expectations are that services have turned in an
exceptionally strong performance with manufacturing lagging behind.
In recent months, the inflation figures have been at their lowest
levels for 30 years, but the tide is expected to turn, albeit
temporarily, with higher producer and retail prices expected to show
through in the December figures published today and on Wednesday.
The culprit is the duty increases imposed in the Budget. Mr Cole
forecasts this will add 0.5% to factory gate prices for an annual rate
of 4%.
The headline inflation rate has even more to contend with as one of
the 1992 mortgage rate cuts drops out of the calculations.
A rise of 0.4% in the monthly RPI would take the annual rate up from
1.4% to 2.1%.
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