The Economic Week Ahead Jan. 9-13

The Q4-2022 earnings reporting season starts this week with the big money center banks. They are unlikely to surprise investors. Their managements may once again warn, as they have in the past, that a consumer-led recession is likely this year. That's old news, and the markets aren't likely to react to it. Besides, if the banks expect a recession, why haven't they been adding much to their loan-loss reserves?

November's consumer credit report (Mon) is likely to show that revolving credit rose to a new record high. That might heighten fears that consumers are getting stretched. December's consumer inflation expectations, compiled by the FRBNY, should show further moderation, confirming that inflation is easing. Of course, December's CPI (Thur) will be the big inflation release of the week. We are expecting a downside surprise thanks to rapidly falling gasoline and natural gas prices and deflating durable goods prices, led by used cars.