US figures to show hope for economy

US economic indicators to be released this week will show continued weakness in the overall economy, according to analysts.

But one bright spot will be the housing sector, which is expected to remain resilient.

"There's been some sign that the housing market is getting a second wind," said Robert McGee, chief economist at Tokai Bank in New York.

Mr McGee noted that relatively easy credit has been able to sustain the housing market despite the increase in unemployment and downturn in the stock market.

In contrast, orders for durable goods are expected to return toward their downward path and decline 4.6% after last month's aberrant 12.8% increase.

"There was that big pop in defence orders because of the Lockheed contract," said James O'Sullivan of UBS Warburg in Connecticut.

Lockheed Martin Corp won a $200 billion contract for the Joint Strike Fighter project in October, but durable goods orders declined four consecutive months prior to the announcement.

Despite the drop from last month, economist William Dudley of Goldman Sachs in New York expects durable goods orders to be on an overall upward trend.

"The underlying pattern of orders is improving, although you wouldn't know it from the November figure," Dudley said, noting that the decline in orders "is a payback from the prior month."

He agreed that the housing market would continue to show strength, which he attributed to Federal Reserve chairman Alan Greenspan and favorable weather conditions.

"It was a very good time to go out and buy a home," Dudley said, noting low mortgage rates and one of the warmest Novembers in a century.

Dudley, however, cautioned that there is not much room for further improvement in the housing sector.

"That's probably as good as it gets," he said.