The Bank of England could report in early January that bank lending to companies has fallen for a third successive month. The same day, purchasing managers are likely to report that manufacturing is growing much more slowly than it did earlier in 2014.
Much the same is true in the euro area. Purchasing managers will report that manufacturing is more or less stagnating, whilst figures on Tuesday 30th are expected to show that lending to companies is still falling. There might, however, be some glimmers of hope here. The drop in bank lending should be smaller than it was a few months ago, and on Tuesday 23rd the National Bank of Belgium's indicator of business conditions (which is a useful barometer for the euro area generally) might show a fifth successive monthly rise, albeit from a low level.
One interesting feature of those monetary figures is likely to be a continued drop in long-term deposits with euro area banks and rise in shorter-term ones. An optimistic reading of this is that low interest rates will soon encourage people to start spending more. A pessimistic reading is that savers still don't trust banks and don't want to tie up their money with them for long periods.
US figures, however, should be more cheerful. One Tuesday 23, durable goods orders should post a small rise. This should be consistent with the ISM survey on Friday 2, which is likely to show that the manufacturing sector is growing well.
Consumer sentiment could also improve, with the Conference Board on Tuesday 30th reporting a rise in confidence. This is no mere idle talk. It should also be reflected in the housing market. We should see a rise in sales of both new and existing homes, and an increase in house prices; the S&P/Case-Shiller index should see a 5 per cent annual rise.
Although UK national accounts on Tuesday 23rd should confirm that GDP grew by 0.7 per cent in the third quarter, there'll be interesting detail in the numbers, in particular about financial balances. The numbers could show that companies' financial surplus has disappeared whilst the household sector is in deficit as a result of low savings and spending on housing. However, with the housing market cooling and companies not borrowing from banks, it is not clear that these trends can continue.
