Here’s what to expect in the week ahead:
With the economy and job market continuing to improve, demand for homes has been rising. But housing inventory remains limited, pushing prices upward and leaving prospective home buyers depressed about their chances of leaving rental apartments. As a result, if you own a home, the American housing market has been great. If you don’t, it’s been horrible.
Two reports this week will shed light on that dichotomy and give a sense of whether the home market economy is moving toward equilibrium. The October report on new home sales will come out on Monday, following a strong rise in September. The numbers are notoriously volatile, but have slowly edged upward, a trend that appears likely to continue as long as job growth remains strong.
Still, construction is not rising fast enough to keep up with demand. The S.&P. CoreLogic Case-Shiller Home Price Index, coming Tuesday, was expected to show that home prices have continued to rise as the supply of new homes remained limited. The net effect of these trends is that the housing sector is not contributing to the economy as much as it could. Conor Dougherty
The Bank of England is expected to provide its semiannual outlook on the financial stability of the British financial system on Tuesday, as well as the results of its latest stress test to measure the ability of Britain’s largest lenders to weather another financial shock. In June, the central bank said that Britain’s financial system remained stable over all, but warned that “there are pockets of risk that warrant vigilance,” including rising consumer debt and easier lending conditions in the mortgage market.
Since its last financial stability report, the rate of inflation also has increased steadily, hitting 2.8 percent in October. The Bank of England raised its main interest rate this month for the first time in a decade as it tried to strike a balance between moderate growth and rising prices. The value of the pound has declined sharply since Britons voted last year to leave the European Union. Chad Bray
Jerome H. Powell, President Trump’s nominee to be the next chairman of the Federal Reserve, will head to Capitol Hill on Tuesday for a confirmation hearing before the Senate Banking Committee. Janet L. Yellen, the current Fed chairwoman, will testify on Wednesday before the Joint Economic Committee in what could be her final appearance before Congress as the head of the central bank, a post she is expected to pass to Mr. Powell in early February.
The back-to-back hearings should provide an opportunity to compare the views of Mr. Powell and Ms. Yellen on the issues confronting the Fed, including how fast to raise interest rates, how best to prepare for future economic downturns and how far to roll back postcrisis financial regulations. Binyamin Appelbaum
The Senate Republican tax legislation may reach the floor this week, what would be a major step in the party’s hopes for rewriting the tax code. House Republicans already passed their version of the tax cut bill this month and the Senate plan has cleared the Finance Committee. No Democrats have supported the legislation in either chamber.
Because of the slim majority that Republicans hold in the Senate, the vote could be delayed if more than two Republican senators oppose the bill. Thus far, at least four Republican senators have expressed trepidations about the plan. Alan Rappeport
Most analysts forecast that OPEC and Russia will agree to extend their production cuts beyond March 2018 when the oil producers’ group meets on Thursday in Vienna. Oil prices have recently risen to their highest levels in two years — now about $63 a barrel for Brent crude — as political instability led to lower output in member countries like Venezuela and Iraq. The recent detention of princes by Saudi Arabia, OPEC’s de facto leader, has also worried markets. Still, the Saudis want to continue to trim output to deal with the lingering oil glut and to support the expected sale of a stake in Saudi Aramco, the national oil company, next year. Stanley Reed
On Friday, automakers will report new car sales for November, and the industry is expected to show a 1 percent decline from the same month a year ago. But that doesn’t mean sales are flagging.
Consumers continue to snap up sport utility vehicles and trucks at a brisk pace, spurred by a rising stock market, low interest rates and favorable manufacturer incentives. Even with a decline in sales, the total will be the second-best in history for the month of November, according to Kelley Blue Book. The only better November came in 2016. Neal E. Boudette