Japan’s industrial production grew the most since 2011, indicating the economy is strengthening as a looming sales-tax bump stimulates demand, while inflation matched the highest level in more than five years.
Housing starts probably fell in January as colder-than-normal temperatures and snowstorms slowed work in parts of the U.S., data this week are forecast to show. The projected decline indicates the residential real estate market succumbed to the same inclement conditions that have slowed retail sales, manufacturing and job growth. Another report may show higher borrowing costs at the start of the year, along with the weather, slowed sales of previously owned homes.
The Bank of Japan will need to postpone the time-frame for achieving a 2 percent inflation target as it refrains from enlarging its asset-purchase program, economists forecast in a Bloomberg News survey.
The data docket in the U.S. this week will be eclipsed by the Federal Reserve meeting as prospects mount that policy makers will trim stimulus in response to an improving economy. Elsewhere, November price data out of the U.K. will probably show inflation is cooling toward the Bank of England’s target, German companies gained confidence in December and inflation in Brazil picked up through the middle of this month.
Japanese companies eased off on capital-spending growth in the third quarter and failed to step up exports even with a cheaper yen, contributing to an economic slowdown that puts pressure on Prime Minister Shinzo Abe.