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Next week's economics: 29 May-2 June

Next week's economics: 29 May-2 June
May 25, 2017
Next week's economics: 29 May-2 June

On Thursday, purchasing managers could report that manufacturing activity is growing at around its fastest pace since late 2013. Other figures in the week will show a reason for this: growth in overseas economies is boosting demand for exports.

In Japan, we should see a rise in industrial production after a dip last month, confirming an upward trend in output.

In the eurozone, final purchasing managers' reports should confirm initial ones showing strong growth, while ECB data on Monday should show that bank lending is now growing well.

And in the US, the ISM survey should show strong growth in manufacturing; non-farm payroll numbers on Friday should record another 200,000 net rise in employment; and the Conference Board could report that consumer confidence is still near a 17-year high, even if it is slightly down from its peak.

Domestic UK news, however, might be less rosy. Purchasing managers might report on Friday that construction activity is weak. This would be consistent with uncertainty depressing demand for longer-lived assets. It would also be consistent with Bank of England figures on Wednesday, which could show that bank lending to non-financial companies has not grown in recent months.

News about the consumer might also be mixed. GfK could tell us that consumer confidence is lower now than a year ago, as the squeeze on real wages is offsetting jobs growth - although it is still much higher than in 2011-13. This picture might be corroborated by Bank of England figures showing a small drop in annual growth in consumer credit, although this will still be around 10 per cent.

We'll also see a softening in the housing market. Nationwide might report that house price inflation has dropped to 2 per cent, a four-year low, while the bank could report a drop in mortgage approvals. This would be no bad thing if it diminishes the unaffordability of housing, but it would be a concern if it is a sign of diminished confidence in future incomes.

We'll also get some news on overseas inflation. On Wednesday, eurozone data should tell us whether last month's rise in core inflation was just a blip or not. Figures the same day will show that unemployment is still well over 9 per cent, so it would be very worrying if inflation were to be a problem with such high joblessness.

And on Friday, US figures could show that wage growth is lower than it was late last year, despite the fact that the unemployment rate has fallen to its lowest since 2001. It could be that hidden unemployment is still holding down wages: the employment-population ratio is low by historic standards.