Recent weeks have emphasized markets (especially declining commodity prices) as a read on the economy. This week's full slate of data will provide a reality check on that interpretation. The punditry will be asking:

Will July economic data confirm the weakness signaled by commodities?

Prior Theme Recap

In my last WTWA I predicted that discussion would focus on the “message of the markets.” This was a good call, with many stories featuring this theme. Interpretation was challenging because of the early-week swings. As he does each week, Doug Short's recap explains the story and his great weekly snapshot lets you see it at a glance. With the ever-increasing effects from foreign markets, you might add Doug's Doug Short's recap to your reading list.

We would all like to know the direction of the market in advance. Good luck with that! Second best is planning what to look for and how to react. That is the purpose of considering possible themes for the week ahead. You can try it at home.

This Week's Theme

This week is the flip side of last week's emphasis on market signals, especially commodity prices. The big earnings message has been registered, along with the huge July plunge in commodities and energy stocks. The crowded calendar for economic data releases provides the first insight into July results. Observers will be asking:

Will July economic data confirm the message of economic weakness?

…and for some… Will the Fed react?

The Viewpoints

The conclusions about the economy cover a wide range.

• The market message warns of deflation and recession. Brad Zigler highlights some “ominous indicators.” He looks at a “daily inflation index” and also gold versus oil.
• Economic fundamentals remain weak, concludes Steven Hansen in his survey article discussing the GEI economic forecasts. Dr. Ed also sees an economy that is “getting soft again.”
• There is no contagion from energy credit spreads or China. Scott Grannis analyzes the data.
• Economic growth maintains a solid, if modest, uptrend. New Deal Democrat does a nice analysis of GDP data with a hat tip to the Atlanta Fed's GDPNow calculator – right on target. The key point is the superiority of methods like this over those used by those on a mission – “Doomers” in his parlance – who seek out an indicator to prove a point.
• Indicators remains solid except for industrial production, notes Menzie Chinn in his careful look at both US and global data. He distinguishes between slowdowns and actual reductions in output.
• Continued employment gains could encourage the Fed to move in September. Top Fed watcher Tim Duy parses this week's statement and suggests what to watch for in the data.

As always, I have my own ideas in today's conclusion. But first, let us do our regular update of the last week's news and data. Readers, especially those new to this series, will benefit from reading the background information.

Personal Note

I am going on vacation beginning next weekend so there will be no WTWA. If something really interesting happens, I might post a brief comment. Posting on the following weekend is also uncertain. I often get emails from readers when I miss a week or two, and I appreciate the concern. I am sure that everyone knows I need some time off. So far, I have not figured out a good alternative, but I am considering some pinch-hitters.

Last Week's Data

Each week I break down events into good and bad. Often there is “ugly” and on rare occasion something really good. My working definition of “good” has two components:

The Good

There was some good economic news.