Economics

U.S. Inflation Picture Remains Subdued

September 9, 2014

The inflation picture is on everybody’s radar screen and the import/export price report this Friday will be the first of three coming releases from the Labor Department this month, including the producer and consumer price indexes. Street expectations are for a 0.8 percent decline in import prices. There is currently little concern regarding

Growth in Trade Shows Fed No Longer Stands Alone

September 2, 2014

There was encouraging news in the second estimate of second quarter GDP. Total trade posted its largest combined percentage gain since 2010, before the European crisis began in earnest. While the growth in imports actually subtracts from U.S. GDP as an accounting matter, it reflects stronger demand from U.S. firms and consumers. The

Barometers Suggest U.S. Economy to Grow 3% in Third Quarter

August 26, 2014

U.S. economic activity grew an average of 1 percent in the first half — the product of a steep 2.1 percent contraction during the first three months of the year, and a sharp 4 percent rebound in the second quarter. All eyes are focused on third-quarter performance to see how strong, or frail, the recovery effort has

Homebuilder Optimism Continues to Outshine Activity

August 19, 2014

The increase in the NAHB housing market index to 55 in August from 53 extended the divergence between homebuilder sentiment and most other major housing market data releases, most of which have been disappointing recently. During the past two months, the most important development was the surge in foot traffic in the two

Fed Monitoring JOLTS Report for Clues to Labor Slack

August 12, 2014

JOLTS Report (Survey, 4.600 million; Prior: 4.635 million): Now that the jobs opening rate has begun to pick up, the question is whether hiring and quits will rise as well. The FOMC will be closely attuned to indications that job creation is accelerating and workers are gaining confidence. This report is thought to

Rising Demand Bodes Well for U.S. Factory Orders

August 5, 2014

Demand for manufactured goods jumped sharply in the second quarter. Motor vehicles and parts, durable household equipment and recreational goods and vehicles all saw double digit growth on the quarter, which bodes well for the June factory orders release this morning at 10 a.m. New York time. (Survey: 0.6%; Prior: -0.5%) — Bloomberg

U.S. Home Prices Continue to Face Uphill Battle

July 29, 2014

Economists expect the May S&P/Case Shiller index of the composite 20 cities home prices to be 9.9 percent higher than year ago levels. Los Angeles, Washington DC, San Diego, and San Francisco have the largest index values of the 20 areas. None have equaled their pre-recession peaks and remain a fraction of mid-2006

Part-Time Workers’ Sentiment Shows Progress on Slack

July 22, 2014

In June, part-time workers enjoyed outsized gains in the Bloomberg consumer comfort index relative to both unemployed and full-time employed. Given June’s simultaneous increase in part-time workers and decrease in the long-term unemployed, this may reflect the relief of people who are once again receiving paychecks. If they don’t sustain these gains, that

Lower Prices May Result in Weaker U.S. Retail Sales

July 15, 2014

Economists polled by Bloomberg expect total retail sales to advance 0.6 percent in June after May’s 0.3 percent increase. Flat-to-slightly lower prices might result in a weaker-than-expected performance. This report is not adjusted for inflation, so it is difficult to distinguish whether sales trends are because of prices or volumes.

Jobless Claims Point Toward Better U.S. Growth

July 14, 2014

  During the last five decades, the quarterly average of the 4-week average of initial jobless claims has been a reasonably good predictor of GDP growth. This chart was taken from the Bloomberg Brief Economics Newsletter. Click here to take a 30 day trial.