Reports Expected to Show More Economic Slowing

Analysts expect more evidence of slower growth and moderate inflation this week in the form of reports on retail sales and producer and consumer prices for last month. Bond-market sentiment has shifted to the point that a growing number of analysts are talking about potential rate cuts by the Federal Reserve in coming months. Even more predict that policymakers will conclude at their Oct. 3 meeting that the risks associated with inflation and recession are balanced going forward. At the moment, both propositions appear to be wishful thinking. As long as the nation’s labor markets remain as tight as they are, most Fed officials are going to continue to worry out loud about the possibility that compensation increases and inflation will accelerate.

Economic reports due this week:

* Wednesday, the Labor Department will report on the rise or fall of import prices in August. The expectation is that they probably increased after holding steady in July because of higher crude oil prices.

* Wednesday, the Commerce Department will publish the nation’s current account--the broadest measure of U.S. trade--for the second quarter. It had widened to between $108 billion and $102.3 billion in the first.

* Thursday, the Labor Department will report the producer price index for August. The PPI saw no change in July, though the core rate rose 0.1%.

* Thursday, the Commerce Department will issue the retail sales report for August. Independent reports out last week showed that most retailers posted disappointing August sales despite the back-to-school shopping season.

* Friday, the Labor Department will issue the consumer price index for August. The CPI, a measure of inflation, rose 0.2% in July, as did the CPI core rate, which factors out volatile costs such as energy.

* Friday, the Federal Reserve will report on the output of the nation’s factories, mines and utilities for August. Industrial production rose 0.4% in July.

* Friday, the Commerce Department will report on business inventories in July. They rose 0.9% during June.