US Week Ahead: New Home Sales, Consumer Confidence
New home sales likely increased 1.5% to a 375K pace in November. Our forecast is for a small decline in housing starts in November, but an improvement in permits. Both permits and starts have been extraordinarily strong lately, along with homebuilder confidence, and we expect that new home sales will carry along this trend.
We look for a decline in December consumer confidence to 67.0 from 73.7. The University of Michigan Consumer Sentiment index fell sharply for the month, indicating consumers’ pessimistic expectations, likely driven by the fiscal cliff. We expect the consumer confidence index to reflect similar themes and a drop of a similar magnitude is expected.