U.S. Economic News

U.S. Economic News

September 16, 2019

U.S. Economic Indicators

The September Empire State Manufacturing Survey indicates that business activity ebbed slightly in September as the headline index edged down 2.8 points to 2.0. The new orders index fell 3.2 points to 3.5, while the shipments index fell 3.5 points to 5.8; meanwhile, the index for number of employees rose 11.3 points to 9.7 and the hours worked index turned positive, indicating a slightly longer workweek. NY Fed Report

U.S. News

According to the Wall Street Journal, the latest drone strikes on Saudi Arabian oil production facilities and resulting rise in global oil prices are likely to have noticeable effects on China and Japan but little impact on U.S. economic activity. Since energy consumption accounts for much less of U.S. households’ total consumption while domestic U.S. oil production continues to climb, higher oil prices are likely to have a muted effect on the U.S. economy compared to the past. WSJ

Jeanna Smialek reports for the New York Times that the Federal Reserve is likely to cut interest rates for a second time Wednesday as policymakers attempt to get ahead of risks from the global economic slowdown and uncertainty stemming from the U.S.-China trade war. While investors largely expect a rate cut, the decision could still be contentious, as economic data continue to send mixed signals about the underlying health of the economy. NYT

U.S. Economic News

U.S. Economic News

September 13, 2019

U.S. Economic Indicators

Retail sales rose 0.4% in August and are up 4.1% from a year ago. Core sales — which exclude autos, gasoline, building materials, and food services —  increased 0.3%. Census Bureau Report

Business inventories increased 0.4% in July and were up 4.8% from July of last year. Manufacturers’ sales declined 0.2% in July but were up 0.5% compared to a year ago. Census Bureau Report

The University of Michigan Consumer Sentiment Index rose 2.2 points to 92.0 in the preliminary September reading but is down 8.1 points from September of last year. The Index of Consumer Expectations rose 2.5 points to 82.4, while the Current Economic Conditions Index rose 1.6 points to 106.9. University of Michigan

U.S. News

Kate Davidson reports for the Wall Street Journal that the U.S. federal budget gap widened to more than $1 trillion in the first 11 months of the current fiscal year, the first time the year-to-date deficit has topped that amount since 2012. A strong U.S. economy typically leads to narrower deficits, but higher government spending and lower revenue collection following the 2017 tax cuts have pushed the deficit up 19% since October of last year. WSJ

The Financial Times reports that China has announced it will exempt certain U.S. pork and soybean purchases from additional tariffs in the latest of a series of goodwill gestures intended to reduce trade tensions. The total amount of agricultural products Chinese companies intend to purchase under the new arrangement is still unclear, but the announcement represents an opportunity for U.S. pork farmers who have been left out of the recent surge in pork imports into China. FT

U.S. Economic News

U.S. Economic News

September 12, 2019

U.S. Economic Indicators

Consumer prices rose 0.1% in August (up 1.7% from a year ago). The “core” CPI, which excludes food and energy, increased 0.3% in August and is up 2.4% from last year. BLS Report

Initial jobless claims fell 15,000 to 204,000 last week. The four-week moving average declined 4,250 to 212,500. DOL Report

U.S. News

The Wall Street Journal reports that China is aiming to narrow the scope of upcoming negotiations with the U.S. to only trade issues, hoping to separate trade talks from discussions about national security issues in an attempt to break the deadlock between the two countries. Even a more limited deal addressing strictly trade issues may still be difficult to achieve, however, as U.S. and Chinese officials are likely to disagree on which issues are categorized as trade or national security matters. WSJ

According to the Wall Street Journal, the Social Security expansion plan under consideration by House Democrats to extend the program’s solvency would raise the cap on payroll taxes from 6.2% to 7.4% over 25 years. Opposition in the Republican-led Senate make it unlikely that the proposed expansion will become law, but the debate underscores the need to address the solvency of Social Security given that the program’s trust funds are expected to be exhausted by 2035. WSJ

U.S. Economic News

U.S. Economic News

September 11, 2019

U.S. Economic Indicators

The headline Producer Price Index (“PPI”) for final demand rose 0.1% in August and was up 1.8% from August of last year. The core — which removes volatile prices of food, energy, and trade services — rose 0.4% in August and was up 1.9% from a year ago. BLS Report

U.S. News

According to the Wall Street Journal, median American household income remained essentially flat in 2018 after three consecutive years of growth, according to recent figures from the U.S. Census Bureau. Income growth over the past 10 years has been weaker than expected given the tightness of the U.S. labor market, partly due to the ability of employers to hold down wages by adopting more technology and the declining share of workers in labor unions. WSJ

The Financial Times reports that pessimism about revenue prospects among U.S. companies operating in China is mainly due to concerns about the overall slowing of Chinese growth, rather than impacts from U.S. tariffs. The proportion of companies expecting revenue growth in China this year is down sharply, as Chinese growth slows to its lowest level since the early 1990s. FT

U.S. Economic News

U.S. Economic News

September 10, 2019

U.S. Economic Indicators

The NFIB Small Business Optimism Index fell 1.6 points to 103.1 in August as three components improved, six weakened, and one was unchanged. Capital spending plans and earnings expectations improved, while plans for increasing employment and inventories eased. NFIB Report

The Job Openings and Labor Turnover Survey (“JOLTS”), a closely-watched measure of labor market health, indicated there were 7.2 million job openings at the end of July, essentially unchanged from JuneHires inched up to 6.0 million, while the quits rate was little changed at 2.4 percent. BLS Report

U.S. News

According to the Financial Times, U.S. retailers are dropping Chinese suppliers in response to tariffs and switching to countries such as Vietnam, Cambodia, and Thailand to source their goods. While U.S. tariffs have accelerated retailers’ need to pull out of China, many already had plans in place to shift supply chains out of the country amid rising labor costs. FT

The Financial Times reports that global manufacturing activity, particularly in the auto industry, is experiencing its most severe and geographically widespread downturn in at least six years as pressure mounts from the U.S.-China trade war. Manufacturing activity among car producers across the globe has reached near-record lows and is likely to continue to ease as sentiment among manufacturers remains weak. FT