U.S. Economic News

U.S. Economic News

August 8, 2019

U.S. Economic Indicators

Initial jobless claims fell 8,000 to 209,000 last week. The four-week moving average rose 250 to 212,250. DOL Report

U.S. News

The Financial Times reports that Chinese exports grew 3.3% year-on-year in July, beating economists’ expectations and reflecting the fact that exports to the U.S. make up a relatively small proportion of China’s total trade. Rising Chinese exports to markets in Southeast Asia have provided a significant cushion against declining trade with the U.S. amid the ongoing trade conflict. FT

According to the Wall Street Journal, inflated bond ratings — one cause of the 2008 financial crisis — persist in the present-day bond market as ratings firms offer increasingly optimistic scores as they fight for market share. Newer challenger firms systemically rate bonds higher than major firms, suggesting that regulation intended to improve rating quality by promoting competition has largely backfired. WSJ

U.S. Economic News

U.S. Economic News

August 7, 2019

U.S. News

According to the Wall Street Journal, the U.S. Treasury has collected more than $63 billion in tariffs since June of last year, up from around $30 billion in annual collections before the trade conflict with China. The U.S. is now on pace to collect around $72 billion in tariffs annually, with collections projected to reach as high as $100 billion if a new 10% tariff is imposed on an additional $300 billion in Chinese goods next month. WSJ

Bloomberg reports that U.S. companies are rapidly running out of warehouse space after packing storage facilities with imported goods in an effort to avoid anticipated tariffs on Chinese imports. The dearth of additional warehouse space means that many companies will be unable to use preemptive stockpiling to mitigate the effects of the next round of tariffs scheduled for September 1. Bloomberg

U.S. Economic News

U.S. Economic News

August 6, 2019

U.S. Economic Indicators

The Job Openings and Labor Turnover Survey (“JOLTS”), a closely-watched measure of labor market health, indicated there were 7.3 million job openings at the end of June, essentially unchanged from MayHires were little changed at 5.7 million, while the quits rate remained at 2.3 percent. BLS Report

U.S. News

The Wall Street Journal reports that the U.S. Treasury officially labeled China a currency manipulator after China’s central bank allowed the renminbi to weaken below seven yuan to the dollar for the first time since 2008. China has emphasized that the depreciation is due to market forces rather than intentional devaluation but is unlikely to allow the currency to decline further as it would increase capital outflows and make it harder for Chinese companies to service their dollar-denominated debt. WSJ

According to Bloomberg, a new study published by the Congressional Budget Office found that consumer price expectations were a better predictor of the overall direction of future inflation than economists’ forecasts over the past twenty years. Although experts predicted the pace of inflation more accurately, consumers better predicted the direction of inflation and future consumer sentiment. Bloomberg

U.S. Economic News

U.S. Economic News

August 5, 2019

U.S. Economic Indicators

The ISM Non-Manufacturing Index fell 1.4 points to 53.7 in July. The New Orders Index declined 1.7 points to 54.1, while the Employment Index rose 1.2 points to 56.2. ISM Report

U.S. News

The Financial Times reports that China has allowed the renminbi to weaken to its lowest level against the dollar since the global financial crisis, blaming trade protectionism and tariffs on Chinese goods for weakening the currency. China has turned to the renminbi as it runs out of policy options for coping with the trade war with the U.S.; the decline in the renminbi likely represents the beginning of a broader wave of depreciation among Asian currencies. FT

Jim Tankersley and Ben Casselman report for the New York Times that changes in the mortgage-interest deduction under the 2017 tax overhaul that reduced the number of homeowners eligible for deductions have not depressed housing prices or activity, as some experts predicted. While housing markets have cooled in many areas of the country, the slowdown in price growth most likely reflects an inevitable deceleration after several years of prices rising faster than wages. NYT

U.S. Economic News

U.S. Economic News

August 2, 2019

U.S. Economic Indicators

The U.S. economy added 164,000 jobs in July, in line with expectations. The unemployment rate remained at 3.7%, the labor force participation rate was little changed at 63.0%, and average hourly earnings annual growth edged up to 3.2%. BLS Report

New factory orders for manufactured goods rose 0.6% in June following a 1.3% decrease in May and are up 0.2% compared to a year ago. New orders excluding transportation rose 0.1%, and new orders for nondefense capital goods excluding aircraft increased 1.5%. Census Bureau Report

The U.S. trade deficit decreased from $55.3 billion in May (revised) to $55.2 billion in June. The goods deficit fell by $0.8 billion while the services surplus fell by $0.6 billion. Census Bureau Report

The University of Michigan Consumer Sentiment Index rose 0.2 point to 98.4 in the final July reading and is up 0.5 point from July of last year. The Index of Consumer Expectations rose 1.2 points to 90.5, while the Current Economic Conditions Index fell 1.2 points to 110.7. University of Michigan

U.S. News

The Financial Times reports that China has announced it will retaliate if the U.S. moves forward with imposing a 10% tariff on $300 billion worth of Chinese goods next month. While Chinese officials have yet to identify specific retaliatory measures, U.S. companies are concerned they will face slower customs clearance, more inspections, and delayed approval for licenses. FT