With job openings falling back to normal and the labor supply increasing, the labor market was in balance in July, an important reason for why the Federal Reserve in our view should have cut its policy rate in July. The drop in job openings explained part of why job gains were unexpectedly low in July. ... READ MORE >
Manufacturing sector declines at a slightly slower rate in August
The manufacturing sector contracted for the fifth month in a row with both production and new orders being a significant drag, according to the Institute for Supply Management's purchasing managers' index. Even though the Federal Reserve has signaled a policy pivot to lower interest rates, the sector ... READ MORE >
Second quarter GDP is revised higher amid stronger consumer spending
The growth scare that rocked the market in early August looks premature after the release of new data on gross domestic product and jobless claims. Growth was stronger in the second quarter, revised up to 3.0%, than the first estimate, driven largely by a sharp upward revision to consumer spending, ... READ MORE >
Demand for business spending on equipment falls in July
Business spending on durable equipment did not start the third quarter on a strong note. Core capital goods orders, which exclude aircraft and defense spending and are a better proxy for short-term business investment in new equipment, decline by 0.1% in July. Shipments of core capital goods fell even ... READ MORE >
Jobless claims stabilize amid concerns over weak job gains
With most of the seasonal fluctuations in the weekly jobs data having eased, new filings for unemployment benefits have returned to a healthier level over the past three weeks. Initial claims last week rose by only 4,000, to 232,000, on a seasonally adjusted basis, according to government data released ... READ MORE >
Consumer sentiment rebounds in August
Consumer sentiment rose for the first time in five months, according to the University of Michigan’s survey in August. The increase is driven by the jump in expectations as consumer sentiment about the next 12 months look better. The topline sentiment index is up to 67.8 from 66.4 in July, with the ... READ MORE >
Robust July retail sales defy growth scare
While robust July retail sales numbers might come as a surprise given the various pressures on American consumers, the data was very well in line with our forecasts ahead of the Thursday data release from the Commerce Department. Further disinflation and 15 consecutive months of positive real wage growth ... READ MORE >
Producer prices grow slower than expected, adding evidence to support rate cut
A drop in July’s producer inflation suggests another month of favorable inflation data that should help seal the deal for a rate cut in September and more afterwards. The final demand inflation rose 0.1% in July and 2.2% from a year ago. Even better, the core component of the producer inflation number ... READ MORE >
Initial jobless claims fell 17,000 last week, easing growth concerns
The impact of Hurricane Beryl in Texas faded faster than expected in U.S. initial jobless claims data, helping push new claims to a four-week low of 233,000 for the week ending Aug. 3, according to Labor Department data released Thursday. The drop in new claims was much-needed good news, as the ... READ MORE >
Service sector bounces back in July, easing growth concerns
Few observers could have expected that the ISM service index would become the market’s savior this week, but that is what happened. The index rose to positive territory at 51.4 after dropping in June to 48.8, suggesting that some of the concerns over an imminent recession looked overblown. We remain ... READ MORE >