U.S. Economic News

U.S. Economic News

July 18, 2019

U.S. Economic Indicators

The Conference Board’s Leading Economic Index (“LEI”) declined 0.3% in June, following no change in May. The decline was driven by weakness in new manufacturing orders, housing permits, and employment, with growth likely to remain slow in the second half of 2019 as the U.S. economy enters its eleventh year of expansion. Conference Board Report

Initial jobless claims rose 8,000 to 216,000 last week. The four-week moving average fell 250 to 218,750. DOL Report

U.S. News

According to the Wall Street Journal, the latest Federal Reserve beige book survey found that American businesses see economic activity expanding modestly in the coming months despite widespread concerns over trade. Businesses pointed to healthy consumer spending while acknowledging continuing struggles with worker shortages. WSJ

The Washington Post reports that the House of Representatives is scheduled to vote Thursday on a bill that would raise the minimum wage gradually from its current level of $7.25 an hour to $15 an hour in 2025. The bill is likely to pass the House with overwhelming Democratic support, but is expected to fail in the Republican-led Senate. WaPo

U.S. Economic News

U.S. Economic News

July 17, 2019

U.S. Economic Indicators

Privately-owned housing starts fell 0.9% in June to a seasonally adjusted annual rate of 1.25 million (up 6.2% year-over-year). Housing permits declined 6.1% to a 1.22 million annual pace in June and are down 6.6% from last year. Census Bureau Report

U.S. News

According to the Financial Times, the WTO has ruled against the U.S. in a tariff dispute case brought by China in 2012 in response to U.S. tariffs on goods subsidized by Chinese state-owned enterprises. The WTO acknowledged China subsidizes some materials, but stated that the U.S. must accept Chinese pricing when calculating tariffs, giving China the option to impose retaliatory measures if the U.S. does not comply with the ruling. FT

The Wall Street Journal reports that Federal Reserve Chairman Jerome Powell stated the upheaval of the 2008 financial crisis reshaped the central banking landscape such that domestic monetary policy must take global developments into account. His assertion comes at a time when slowing growth abroad has likely set the stage for a Fed rate cut despite healthy consumer spending and a strong labor market at home. WSJ

U.S. Economic News

U.S. Economic News

July 16, 2019

U.S. Economic Indicators

Retail sales rose 0.4% in June and are up 3.4% from a year ago. Core sales — which exclude autos, gasoline, building materials, and food services —  increased 0.7%. Census Bureau Report

Industrial production was unchanged in June (up 1.3% year-over-year) after rising 0.4% in May. Capacity utilization declined 0.2 point to 77.9 in June. Fed Report

Business inventories rose 0.3% in May and were up 5.3% from May of last year. Manufacturers’ sales rose 0.1% in May and were up 1.5% compared to a year ago. Census Bureau Report

The NAHB Housing Market Index rose 1.0 point to 65.0 in July. All major components of the index inched higher this month, though builders continue to face headwinds from buildable lot shortages and a lack of skilled labor. NAHB Report

U.S. News

The Wall Street Journal reports that Treasury Secretary Steven Mnuchin has announced the administration is “very close” to reaching a deal with congressional leaders to raise the federal borrowing limit and set spending levels for 2020 and 2021. Congress is under pressure to address the borrowing limit before the August recess to avoid a possible government shutdown in early September. WSJ

United States: 2019 Mid-Year Macro Update

United States: 2019 Mid-Year Macro Update

July 15, 2019

The U.S. economy continued its decade-long expansion in the first quarter of 2019, achieving 3.1% annualized growth. The expansion is being driven by a strong labor market and low borrowing costs, but several headwinds are gaining momentum. Softening in housing and manufacturing, compounded by uncertainty from international trade disputes, is likely to dampen growth to 2.3-2.5% for the year.

Related Documents: Key Insight – United States: 2019 Mid-Year Macro Update

U.S. Economic News

U.S. Economic News

U.S. Economic Indicators

The July Empire State Manufacturing Survey indicates that business activity rebounded modestly in July, as the headline index rose 12.9 points to 4.3, climbing out of negative territory. The new orders index rose 10.5 points to -1.5, while the shipments index fell 2.5 points to 7.2; meanwhile, the index for number of employees dropped 6.1 points to -9.6 and the hours worked index turned positive, indicating a slightly longer workweek. NY Fed Report

U.S. News

The Financial Times reports that China’s economy grew at its slowest pace in almost three decades as the trade war with the U.S. led to a sharp contraction in exports in the second quarter of 2019. Stronger than expected growth in consumer spending and a boost from tax cuts enacted earlier in the year partially offset some of the effects of reduced exports, supporting Beijing’s assertion that China’s domestic economy is robust enough to withstand a protracted trade conflict. FT

In an op-ed published in the Washington Post, Vice President Mike Pence urges Congress to pass the U.S.-Mexico-Canada Agreement, calling it a “win for all three countries” that would include stringent Mexican labor protections and add an estimated 176,000 new jobs to the U.S. economy. He also noted that the deal would close auto import loopholes by requiring at least 75% of a vehicle to be manufactured with parts made in North America for it to be sold duty-free. WaPo

According to the Wall Street Journal, the current U.S. labor market is far less tight than official unemployment figures suggest, indicating that traditional methods for measuring the health of the job market may be inadequate. Historically low headline unemployment amid muted wage growth and weak inflation may reflect a higher proportion of part-time workers or a rising share of younger Americans attending college instead of looking for work. WSJ