U.S. Economic News

U.S. Economic News

April 7, 2020

U.S. Economic Indicators

The NFIB Small Business Optimism Index fell 8.1 points to 96.4 in March, the largest monthly decline in the survey’s history, as nine components weakened and one improved. The decline in the headline index was driven by deteriorating expectations for sales and economic conditions as small businesses brace for further disruptions. NFIB Report

The Job Openings and Labor Turnover Survey (“JOLTS”) indicates that the number of job openings at the end of February was little changed at 6.9 million, before widespread coronavirus disruptionsThe number of hires was little changed at 5.9 million, while the quits rate was unchanged at 2.3 percent. BLS Report

U.S. News

A new poll by the Financial Times shows that nearly three-fourths of Americans say their family’s income has already been reduced due to the coronavirus pandemic, with nearly half reporting that they would be without any income at all if they were unable to work due to illness. The financial hit from coronavirus is being felt across income groups, suggesting that the pandemic is hitting professional services as well as main street businesses. FT

The Washington Post reports that the White House and congressional leadership are discussing the need for a new assistance package as it becomes clear that the $2 trillion stimulus enacted last month will not be enough to contain the pandemic’s economic impact. The follow-up effort will likely be an extension of programs created by the original Cares Act, and may included extended small business assistance and unemployment aid, another round of direct payments, additional corporate aid, and more funding for the overwhelmed health care system. WaPo

U.S. Economic News

U.S. Economic News

April 6, 2020

U.S. News

New analysis by the Wall Street Journal and Moody’s shows that over a quarter of U.S. daily economic output has disappeared since the first week of March due to regional coronavirus shutdowns, with the large metropolitan counties under lockdown orders representing a disproportionate share of national output. If the 29% monthly drop in daily economic output were sustained over the next two months, it would suggest a roughly 75% annualized GDP decline in the second quarter. WSJ

According to Bloomberg, Saudi Arabia, Russia, and other major oil producers are trying to negotiate a deal to reduce oil production by 10%, but U.S. participation – a critical component of reducing global output – appears highly tenuous. The world is rapidly running out of oil storage as demand dries up while production continues, with some producers on the verge of having to suspend output completely if the major players are unable to come to an orderly supply cut agreement. Bloomberg

U.S. Economic News

U.S. Economic News

April 3, 2020

U.S. Economic Indicators

The U.S. economy lost 701,000 jobs in March, far more than consensus estimates. The unemployment rate rose to 4.4%, the labor force participation rate fell to 62.7%, and average hourly earnings annual growth was 3.1%. BLS Report

The ISM Non-Manufacturing Index fell 4.8 points to 52.5 in March. The New Orders Index fell 10.2 points to 52.9, while the Employment Index declined 8.6 points to 47.0. ISM Report

U.S. News

The Wall Street Journal reports that Saudi Arabia and Russia are set to lead a virtual summit next week to discuss reducing oil production by at least 6 million barrels a day – contingent on cooperation from U.S. producers. Oil prices surged following the announcement of upcoming negotiations, but analysts note that join production curbs will be more difficult to enact in the U.S. because of American antitrust laws. WSJ

U.S. Economic News

U.S. Economic News

April 2, 2020

U.S. Economic Indicators

Initial jobless claims increased 3,341,000 to 6,648,000 last week, setting a new high for the history of the series. The four-week moving average rose 1,607,750 to 2,612,000. DOL Report

The U.S. trade deficit decreased from $45.5 billion (revised) in January to $39.9 billion in February. The goods deficit fell by $5.9 billion while the services surplus fell by $0.4 billion. Census Bureau Report

New factory orders for manufactured goods were virtually unchanged in February following a 0.5% (revised) decrease in January. New orders excluding transportation edged down 0.9%, while new orders for nondefense capital goods excluding aircraft also fell 0.9%. Census Bureau Report

U.S. News

According to the Financial Times, surging demand for drugs and protective gear has given new urgency to calls from a growing group of bipartisan lawmakers for medical supply companies to reduce reliance on Chinese supply chains. Policymakers have acknowledged that crafting policies to encourage reshoring of drug and medical equipment production will be difficult, given the challenges of altering complex supply networks and the need for financial incentives. FT

U.S. Economic News

U.S. Economic News

April 1, 2020

U.S. Economic Indicators

The ADP Employment Report shows that private-sector employment decreased by 27,000 jobs in March, contracting far less than expected; however, the report only uses data through March 12 and does not reflect the impact of COVID-19 for the full month. The service sector lost 18,000 jobs, while the goods-producing sector lost 9,000 jobs. ADP Report

The ISM Manufacturing Index fell 1.0 point to 49.1 in March, falling below 50 and into contractionary territory. The Employment Index fell 3.1 points to 43.8, while the New Orders Index fell 7.6 points to 42.2. ISM Report

Construction spending declined 1.3% in February to an annualized rate of $1.37 trillion. Private construction fell 1.2% and public construction fell 1.5%. Census Bureau Report

U.S. News

The Wall Street Journal reports that the $350 billion in government-guaranteed small business loans under the Small Business Administration’s Paycheck Protection Program will provide business owners with loans at just 0.5% interest that will be forgiven if funds are spent on rent, payroll, or utilities and payrolls are maintained for at least 2 months. Although the SBA will not have to directly approve the loans, which businesses can access through their usual lenders,  concerns remain that loan officers will be unable to quickly process all of the applications given the overwhelming demand. WSJ