US: Key economic events ahead – Nomura

Analysts at Nomura provide a brief preview of the main market moving events from the US docket slated for release today.

Key Quotes:

“Housing Starts: We expect housing starts to increase 3.6% m-o-m in January to an annual rate of 1235k. Strong single-family permits data over recent months indicate that a pickup in single-family starts should more than offset a modest decline in the more volatile multi-family starts series.

On the downside, aggregate hours worked in construction in January were somewhat soft, declining 0.3% m-o-m, but this may have been the result of a cold spell during the BLS survey week early in the month. The weather over the rest of January was milder, resulting in average temperatures in line with regular seasonal variation. For building permits, we expect a 0.8% m-o-m increase to an annualized pace of 1310k, consistent with solid gains in residential construction employment and resilient homebuilder confidence.

Prelim UoM consumer sentiment: Consumer sentiment likely remained elevated in the University of Michigan's preliminary February survey of consumers.

However, there is some risk that recent stock price volatility early in the month may have dampened consumers' outlook somewhat (the survey period for the preliminary reading covers 31 January to 14 February). If that were the case, we would expect the slight deterioration to only be temporary as the outlook for job growth and income gains remains firm, especially in light of the changes consumers experienced in their February paychecks as a result of the tax bill.

Inflation expectations at the one-year horizon remained unchanged at 2.7% in January while those for the 5-10-year horizon ticked up 0.1pp to 2.5%.”