Inflation Reports May Bring Bad News

Economic numbers released this week could point again to rising inflation. Among economic numbers, Wall Street will focus on two that are among Federal Reserve Chairman Alan Greenspan’s favorite measures of inflation: the preliminary Employment Cost Index and an initial reading for economic growth, both for the first quarter. Market watchers said if they came in higher than expected and raised the specter of higher interest rates, the data could help derail Wall Street’s recovery. The Bureau of Labor Statistics will report the Employment Cost Index, a gauge of wages Thursday. Economists polled by Reuters expect the measure to rise 0.9%, down from a rise of 1.1% in the last quarter of 1999. At the same time, the Commerce Department will post a preliminary look at the first-quarter’s Gross Domestic Product. Economists forecast growth at an annual rate of 5.6%, cooling from a sizzling 7.3% rise the previous quarter.