U.S. Economic News

U.S. Economic News

April 15, 2020

U.S. Economic Indicators

Retail sales fell 8.7% in March and were down 6.2% from a year ago. Core sales — which exclude autos, gasoline, building materials, and food services —  increased 1.7%. Census Bureau Report

Industrial production declined 5.4% in March – the largest monthly decline since January 1946 – and is down 5.5% year-over-year. Capacity utilization fell 4.3 points to 72.7. Fed Report

Business inventories edged down 0.4% in February and were down 0.1% from February of last year. Manufacturers’ sales declined 0.2% in February and were up 1.3% compared to a year ago. Census Bureau Report

The Empire State Manufacturing Survey indicates that business activity plunged in April as the headline index fell 56.7 points to -78.2. The new orders index fell 57.0 points to -66.3, the shipments index fell 66.4 points to -68.1; and the index for number of employees fell 53.8 points to -55.3; meanwhile the delivery time index increased 8.8 points to 11.0. NY Fed Report

The NAHB Housing Market Index plunged 42 points to 30 in April , the largest single monthly decline in the history of the series and the lowest level since June 2012. NAHB notes that builders are facing notable supply chain gaps and ongoing confusion about eligibility for the Paycheck Protection Program. NAHB Report

U.S. Economic News

U.S. Economic News

April 14, 2020

U.S. News

The Financial Times reports that junk-rated U.S. companies raised more than $2 billion in debt on Monday, indicating that recent Fed actions to prop up the high-yield market are succeeding. The Fed’s decision to purchase exchange traded funds that buy high-yield debt sparked the largest rally in junk bonds in over ten years – a welcome development for lesser-known and lower-rated companies strapped for cash. FT

According to the Washington Post, a recent survey of local officials shows that over 2,100 U.S. cities – representing 93 million people nationwide – are anticipating major budget shortfalls this year due to the coronavirus pandemic. The $2 trillion dollar rescue package passed in March provides some funding to help local governments with responding to the pandemic, but the funds cannot be used to close the general revenue gaps caused by the sudden economic downturn. WaPo

U.S. Economic News

U.S. Economic News

April 13, 2020

U.S. News

The Wall Street Journal reports that a coalition of global oil producers led by Saudi Arabia, Russia, and the U.S. successfully agreed to cut oil production by a combined 9.7 million barrels a day – over 13% of world production – to address the oversupply caused by the coronavirus-induced fall in demand. However, with oil consumption expected to decline by as much as 30 million barrels a day on account of the virus, many analysts believe the agreement is too little, too late. WSJ

According to the Financial Times, many American and European importers are in the unusual position of trying to intentionally slow down shipments from overseas to avoid having to pay rising warehousing and transport fees. After rushing to frontload imports as Chinese factories shut down earlier this year, businesses have reversed course as economic activity in advanced economies ground to a halt, and are now seeking to use containers as floating storage devices to offset high inventory costs. FT

U.S. Economic News

U.S. Economic News

April 10, 2020

U.S. Economic Indicators

Consumer prices fell 0.4% in March, the largest monthly decline since January 2015 (up 1.5% from a year ago). The “core” CPI, which excludes food and energy, fell 0.1% in March – the first monthly decline since January 2010 – and is up 2.1% from last year. BLS Report

U.S. News

According to the Financial Times, the Fed has announced it will expand the scope of its bond purchases to include shares in exchange traded funds holding riskier debt, an area of the market once though off-limits to the central bank. While the Fed move will provide much-needed relief to the high-yield bond market, detractors argue that the Fed should instead focus efforts on shoring up municipal bond markets to support state and local governments. FT

Bloomberg reports that OPEC+ and other major oil exporters reached an agreement to cut oil production by 10 million barrels a day after the U.S. and Mexico were able to iron out details that threatened to derail the much-needed resolution to the price war between Riyadh and Moscow. Analysts note, however, that the intended production cuts will not be enough to prevent oil inventories from rising sharply in the coming weeks amid the rapid fall in global energy demand. Bloomberg

U.S. Economic News

U.S. Economic News

April 9, 2020

U.S. Economic Indicators

Initial jobless claims fell 261,000 to 6,606,000 last week. The four-week moving average rose 1,598,750 to 4,265,500. DOL Report

The University of Michigan Consumer Sentiment Index fell 18.1 points to 71.0 in the preliminary April reading – the largest monthly decline ever recorded – and is down 26.2 points from April of last year. The Index of Consumer Expectations fell 9.7 points to 70.0, while the Current Economic Conditions Index fell 31.3 points to 70.0. University of Michigan

The headline Producer Price Index (“PPI”) for final demand edged down 0.2% in March but is up 0.7% year-over-year. The core — which removes the volatile prices of food, energy, and trade services — also fell 0.2% in March and is up 1.0% from a year ago.  BLS Report

U.S. News

The Financial Times reports that Fed chairman Jay Powell announced Thursday morning that the central bank would unroll additional emergency tools to support the economy, including new loan facilities to deliver $2.3 trillion in credit to small businesses and municipalities. Under pressure to provide more assistance to struggling state and local governments, the Fed has also indicated plans to purchase up to $500 billion of short-term notes directly from U.S. states. FT