A summer lull in the economy, described as a soft spot by Federal Reserve Chairman Alan Greenspan, is hanging on. As the first days of autumn loom, Americans are wondering when activity will regain its old zip.

Such concerns are on Greenspan’s mind as the Fed chief summons policy-makers to a meeting Tuesday. On the agenda: a quarter-point advance in the central bank’s benchmark short-term interest rate, to 1.75 percent, the third such increase since late June.

Chicago economist Robert Dederick says Greenspan and members of the Fed have offered ample signals that they will push the rate higher on Tuesday.

“It’s pretty much in the bag. The real question is what happens next,” said Dederick, of RGD Economics.

At this point, he said, “the jury is out about whether the soft spot in the economy will harden. The Fed will be waiting for additional information.”

Dederick said until recent weeks there were widespread expectations that the central bank would move twice more on monetary policy before the end the year, boosting the short-term barometer to 2.25 percent.

“However, the Fed has shown that it isn’t committed to following a fixed path,” he said. “For now, it appears there will be only one more move in 2004, after Tuesday. That would mean we will end the year with a rate of 2 percent.”

The housing market’s boom seems never ending, but economist Sung Won Sohn says change is in the air. He expects Tuesday’s report on August housing starts to show a modest decline, to around 1.93 million units annually from 1.98 million in July.

“The bloom is off the rose and the market no longer is sizzling. Construction is facing a slow but gradual decline,” said Sohn, of Wells Fargo & Co. in Minneapolis.

He said houses that sold within 10 hours last year, especially in hot markets of California, now are sitting for 60 to 90 days.

“Especially for houses that cost upwards of $1 million, sellers are being forced to cut prices,” Sohn said.

Builders still are enjoying solid demand for production housing, Sohn said, but in areas where vacant land is extremely expensive there is pressure to cut back on construction or to build multifamily units instead of individual homes.

A list of reports due out includes August leading economic indicators on Thursday, the month’s orders for durable goods Friday and August existing home sales, also Friday.

Of the group, watch durable goods. There are signs that factories are humming faster than the economy can absorb their output. At the same time, inventories remain extremely low.

The stock market has made no progress since the beginning of summer, with equity prices holding near levels seen in March.

Chicago investment manager William Hummer says the situation “is somewhat bizarre, because there is a ferocious rally in the bond market while stocks can achieve only mild returns. It stems from investors around the globe who are chasing any kind of fair return.”

The bond rally has been driven by an enormous flood of liquidity, said Hummer, of Wayne Hummer Investments, at a time when fear of inflation has dissipated.

“Companies are unable to raise prices. They realize that if they try to pass along cost increases to customers they risk disaster. It is a global syndrome,” he said.

The situation is adding to concerns that corporate profits in the months ahead will be less than enormous, as the cost squeeze continues, according to Hummer.

“After this year, profit growth, which has been in double digits, will slow to about a 5 to 7 percent rate,” he said. “But profits still will be going up.”