In This Issue: Mixed Signals About Third Quarter Growth • The August employment report signaled continued modest job growth. Nonfarm payrolls rose 169,000 while the unemployment rate edged down slightly to 7.3 percent. • Both the ISM-manufacturing and non-manufacturing indices came in stronger than expected for August, suggesting a pickup in manufacturing and service […]
Continue ReadingSignals of Stronger Growth and Fed Tapering · Existing home sales rose more than expected in July, but some of the luster was lost from when the new home sales report posted a 13.4 percent drop for the month. · Minutes from the July FOMC meeting confirmed the timeline for the Fed to begin […]
Continue ReadingEconomic Data Shows Mixed Results, Tapering Ahead · Although data releases during the week were mixed, the overall tone still favors tapering in the September FOMC meeting. In fact, core retail sales, which directly feed into the calculation for consumer spending, showed potential upside risks to our third quarter forecast. · In contrast, single-family housing […]
Continue ReadingGrowth Looking a Little Better · A large and unexpected narrowing of June’s trade deficit, thanks to a pivot away from foreign oil, should provide a sizable revision to Q2 GDP. The ISM Non-Manufacturing Index also posted a larger than anticipated gain, though orders backlogs and export orders worsened in the month. · Rising […]
Continue ReadingOnly “Modest” Growth · The advanced estimate of second quarter GDP showed the economy expanded at a faster clip than anticipated, although the downward revision made to the prior quarter took much of the shine off the report. GDP was estimated to have grown at a 1.7 percent annualized rate in the second quarter, up […]
Continue ReadingThird Quarter Off to a Good Start · Although existing home sales retreated in June, new home sales rose to their highest level in five years. Orders for capital goods have now risen for four consecutive months, and the labor market appears to be holding up. · Recent data are consistent with our forecast that […]
Continue ReadingIN THIS ISSUE: Inflation Backdrop Remains Fed Friendly · Inflation data this week showed that price pressures remain manageable. Finished goods producer prices rose 0.8 percent, but price changes were more muted further back in the pipeline. Import and export prices fell on soft global demand. · Firms remain cautious about taking on new workers. […]
Continue ReadingContinued Growth at Subpar Pace. · Modest domestic U.S. growth remains the outlook as both the ISM manufacturing and non-manufacturing surveys signaled continued growth but not an acceleration. Another decline in jobless claims reinforced that message. · Meanwhile, the weakness in exports, due to soft global demand, reflected in a wider trade deficit, which will […]
Continue ReadingOther than Downward Revision, It Was a Good Week · We learned this week that first quarter economic growth was actually weaker than initially reported. · Aside from that, most other indicators were better than expected, which suggests that the slow-growth expansion will continue. · This week’s U.S. Review looks at how consumer and business […]
Continue ReadingFed Signals a Change of Course · The FOMC kept its current pace of asset purchases the same but signaled that it may begin tapering the pace of asset purchases later this year. · Consumer prices rose slightly in May after pulling back over the past two months. Core inflation edged slightly higher, rising 0.2 […]
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