● Eurozone PMI: a slight improvement for weak growth in Dec | Markit
● China PMI: Dec mfg activity shrinks for first time since May | Markit
● Japan PMI: Slow mfg growth continues in Dec | Markit
● German PMI: Private sector activity growth weakest in 18 months in Dec | Markit
● French PMI: Private sector output falls at slowest rate in 4 months | Markit
● UK Inflation Slows to Least Since 2002 as Oil Prices Drop | Bloomberg
● Russia makes drastic rate rise to 17% to stem rouble decline | BBC
● US Industrial Production Surges in Nov | CapSpec
● US home builder confidence eases slightly in Dec | NAHB

Housing starts are expected to increase to an annual pace of 1.030 million in tomorrow’s update for November, according to The Capital Spectator’s median point forecast for several econometric estimates. The projection represents a moderate improvement over October’s 1.009 million units.
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Industrial output increased sharply in November vs. the previous month, rising at a rate that beat expectations by a wide margin (+1.3% vs. Econoday.com’s consensus forecast of +0.7%) . This morning’s monthly release strengthens the case for expecting that the Federal Reserve will begin raising interest rates next year, perhaps sooner than the mid-2015 forecast that’s been widely cited in recent weeks. Meantime, today’s numbers clearly show that the US economy so far appears to be immune to the economic slowdown that’s weighing on China and the stagnation that continues to afflict the Eurozone. Today’s bullish report on industrial activity follows surprisingly strong November numbers on retail sales and payrolls for the US.
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The Federal Reserve’s policy statement and updated economic forecast due out on Wednesday will be closely read in the wake of last week’s volatile market action – the US stock market suffered its worst week in several years while crude oil tumbled to a five-year low. The US economy, however, continues to deliver encouraging news, based on last week’s updates. Notably, the mid-December reading of the Reuters/University of Michigan’s measure of consumer sentiment rose to its highest reading since January 2007. Meanwhile, retail sales posted a sharply higher-than-expected increase in November. We also learned from the US Labor Department that job openings inched higher in October, close to a 14-year high. The upbeat run of numbers is expected to continue this week with today’s release on industrial production and tomorrow’s report on housing starts. No wonder that analysts continue to project that the Fed will start raising interest rates next year, perhaps midway in 2015, as many economists predict.
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● Abe reaffirms Japan’s reflationary policies after election victory | Reuters
● China’s Central Bank Sees 2015 GDP Growth Slowing To 7.1% | MNI
● Germany Leading Index Drops In October | RTT
● Consumer Sentiment in U.S. Rises to Eight-Year High | BusinessWeek
● Oil Slump Blindsides Bulls That Wagered on Rout Ending | Bloomberg
● Hong Kong’s Final Protest Site Has Been Cleared | Time
● Elections in Greece may pose new threat for Eurozone | Guardian

US industrial production in November is projected to increase 0.3% vs. the previous month in tomorrow’s report from the Federal Reserve, according to The Capital Spectator’s median point forecast for several econometric estimates. The expected gain represents a moderate rebound after October’s 0.1% decline.
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The year is winding down, but before it slips away let’s review some of the more memorable titles that have appeared in the weekly Book Bits column that runs in this space each Saturday morning. Here are five economics/finance books from the 2014 archives that deserve a second look. I’ll follow up with five more next week. Happy reading!
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The Treasury market’s implied inflation forecast continues to fade, dipping to 1.70% yesterday (Dec. 11) — close to a four-year low, based on the yield spread for the nominal 10-year Note less its inflation-indexed counterpart. The slide looks worrisome, but appearances can be deceptive at a time when US economic growth is holding steady if not accelerating. Indeed, while economic activity decelerates/stagnates elsewhere, the US trend is gaining momentum, or so yesterday’s retail sales data (and last week’s bullish payrolls update) suggest. Meantime, the bear market in energy may end up boosting US growth on the margins in the months ahead while putting pressure on inflation.
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● House narrowly passes spending bill, averts government shutdown | Reuters
● Eurozone Industrial Output Growth Slows In October | RTT
● In Japan, Abe’s party is set for win, but economy remains a challenge | WaPo
● China’s Slowdown Deepens as Factory Output Growth Wanes | Bloomberg
● Oil closes below $60 for the first time since July 2009 | Fortune
● US Weekly Jobless Claims Edge Slightly Lower To 294,000 | RTT

US retail spending jumped substantially more than expected last month, the Census Bureau reports: up 0.7% in November vs. the previous month. That’s well above the 0.4% consensus forecast. The profile for consumption looks even stronger on a year-over-year basis. It all adds up to a strong signal for the holiday shopping season, and one that resonates in the wake of last week’s surprisingly potent November advance in nonfarm payrolls.
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