While many of latest numbers on the U.S. economy show it’s performing below where many would like it to be, there is increasing evidence the U.S. Federal Reserve is moving closer to raising short-term interest rates for the first time in years.

A report released earlier this week shows industrial production declined 0.2% in October after decreasing the same amount in September, according to the Fed.

Despite the overall decline, the index for manufacturing moved up 0.4%. In contrast, the index for mining fell 1.5% and the index for utilities dropped 2.5%.

For the third quarter as a whole, total industrial production is now estimated to have increased at an annual rate of 2.6%. A gain of 1.8% had been reported previously.

At 107.2% of its 2012 average, total industrial production in October was 0.3% above its year-earlier level.

The latest decline in industrial production reflected both the longer-term trend of a falling energy sector activity as well as a temporary decline in utilities output. The larger and more stable manufacturing component posted a solid increase, according to RBC Economics.

“The manufacturing component is up 1.9% year over year, which is a modest pace of growth, although not as subdued as the signal from recent Institute for Supply Management manufacturing surveys,” says Josh Nye, economist at RBC. “Comments from the ISM surveys indicated that solid domestic demand is being partially offset by the effect of U.S. dollar strength on exports and weakness in the energy sector. With those trends expected to continue in the near term, manufacturing growth is unlikely to accelerate significantly.”

Meantime in the housing sector, two indicators posted declines, with one posting its biggest drop since February.

Led by a steep drop in multifamily production, nationwide housing starts fell 11% to a seasonally adjusted annual rate of 1.06 million units in October, according to the Commerce Department, the slowest pace in seven months.

Multifamily starts fell 25.1% while single-family production edged down 2.4% to 722,000 units. Both sectors, however, posted permit gains.

“This month’s decline can be attributable to the volatile multifamily sector adjusting to trend after an unusually high September, as well as the storms and flooding affecting single-family production in the South,” says National Association of Homebuilders Chief Economist David Crowe. “However, with permits ticking upward, we expect to see the housing market continue to grow at a modest pace.”

Overall permit issuance rose 4.1% to 1.15 million units in October. Multifamily permits rose 6.8% to a rate of 439,000. Single-family permits increased 2.4% to 711,000.

A separate NAHB report shows builder confidence in the market for newly constructed single-family homes slipped three points to 62 in November from an upwardly revised October reading.

“The November report is pullback from an unusually high October, and is more in line with the consistent, modest growth that we have seen throughout the year,” says Crowe. “A firming economy, continued job creation and affordable mortgage rates should keep housing on an upward trajectory as we approach 2016.”

However, such sentiments could easily be thrown off track, says Lindsey Piegza, chief economist at Stifel Fixed Income.

“Going forward, with a rate hike becoming an increasingly likely possibility near-term, a rising rate environment will likely temper demand for housing further without an equally large offset increasing consumers' ability to finance a home purchase.”

Another report worth noting has to do with inflation, specifically what consumers pay at the cash register. It’s been closely watched by the Fed as an indicator as when it may increase interest rates.

The federal government says the Consumer Price Index rose an expected 0.2% following a 0.2% drop in September.

On a year-over-year basis the October CPI is up 0.2% following a 0.0% rate in September.

Core prices, which exclude both the energy and food, rose 0.2% during the month and 1.9% over the past year.

When this last bit of information is added to this mix of economic numbers, it likely means one thing, as two analysts pointed out: The chance of an interest rate hike is growing.

Though the annual increase in the overall CPI remains negligible, core inflation continues to creep higher – approaching the Fed’s 2% objective, according to RBC Economic.

“Such provides further confirmation, along with the October payroll employment report, that slack in the system is being absorbed, resulting in attendant modest upward pressure on inflation,” says Paul Ferley, assistant chief economist at RBC. “With greater stability emerging in financial markets, economic conditions are increasingly moving in favor of the central bank starting to withdraw some of the current highly stimulative monetary conditions. Our forecast assumes that the current Federal Funds range of 0% to 0.25% will be raised 25 basis points (0.25%)."

That meeting, by the way, is set for Dec. 16.

A peek into the minutes of the previous meeting of the Fed’s October meeting reveals a group that is growing increasingly impatient to raise rates against the backdrop of what most perceive as a commitment to begin the process of normalization by the end of the year, according to Stifel’s Piegza.

“At this point, the Fed's credibility is on the line. If the Fed doesn't raise rates in December, they risk the market's interpretation of an unfounded ‘promise’ to do so and further distrust of monetary policymakers down the line,” she says. “Of course, if they do raise rates in December despite a lack of momentum in the economy, they risk having to admit an improper policy move should inflation remain stubbornly low for some time or the economy slows further, forcing the Fed to lower rates soon after a rate increase.”

In other words, they are damned if they do, damned if they don't.

However, a measure of where the economy is headed in the next three to six months shows conditions are improving.

The Leading Economic Index from the private research group The Conference Board increased 0.6% in October to 124, following a 0.1% decline in September and a 0.1% decline in August.

“The U.S. LEI rose sharply in October, with the yield spread, stock prices, and building permits driving the increase,” said Ataman Ozyildirim, director of business cycles and growth research at The Conference Board. “Despite lackluster third quarter growth, the economic outlook now appears to be improving. While the U.S. LEI’s six-month growth rate has moderated, the U.S. economy remains on track for continued expansion heading into 2016.”

While the Fed obviously won’t base its upcoming December decision about interest rates on this one report alone, and there are plenty of others between now and then.