Publications

U.S. News

Bloomberg reports that the unprecedented buildup of oil inventory that amassed during the early days of the pandemic is now almost depleted, in a boon for producers but a concern for motorists and governments wary of inflation. Commercial oil inventories across the OECD have returned to their five-year average, with most of the surplus currently located in China. Bloomberg

The Wall Street Journal reports that new estimates from the Federal Reserve suggest the pandemic’s toll on small businesses was not as bad as feared, with permanent closures roughly 200,000 above the historical average of 600,000. Barber shops, nail salons, and other providers of personal services appear to have been the hardest hit. WSJ

U.S. Economic Indicators

Privately-owned housing starts increased 19.4% in March to a seasonally adjusted annual rate of 1.74 million (up 37.0% year-over-year). Housing permits increased 2.7% to a 1.77 million annual pace (up 30.2% from last year). Census Bureau Report

The University of Michigan Consumer Sentiment Index increased 1.6 points to 86.5 in the preliminary April reading and is up 14.7 points from April of last year. The Index of Consumer Expectations was unchanged at 79.7 points, while the Current Economic Conditions Index rose 4.2 points to 97.2. University of Michigan

U.S. Economic Indicators

Initial jobless claims decreased 193,000 to 576,000. The four-week moving average decreased 47,250 to 683,000. DOL Report

Retail sales rose 9.8% in March and were up 27.7% compared to last year. Core sales — which exclude autos, gasoline, building materials, and food services — increased 6.9% from the prior month. Census Bureau Report

The Empire State Manufacturing Survey indicates that business activity expanded in April as the headline index rose 9.0 points to 26.3. The new orders index increased 17.8 points to 26.9, the index for number of employees improved 4.5 points to 13.9, and the shipments index rose 3.9 points to 25.0. NY Fed Report

Business inventories increased 0.5% in February but were still down 0.5% from February of last year. Manufacturers’ sales fell 2.0% and were down 0.5% compared to a year ago. Census Bureau Report

Industrial production increased 1.4% in March and is up 1.0% year-over-year (down 3.4% from its pre-pandemic level). Capacity utilization rose 1.0 percentage point to 74.4%. Fed Report

U.S. News

The Wall Street Journal reports that the International Energy Agency raised its annual forecast for oil demand in its most recent monthly report, suggesting that the global energy market continues to recover as oil prices rise. In addition, the buildup of global oil inventories from last year’s demand shock is being steadily drawn down, though fresh COVID-related restrictions in parts of Europe could dampen demand in the coming weeks. WSJ

Bloomberg reports that Federal Reserve officials are worried that disinflationary forces from before the pandemic may actually keep longer-term inflation below their 2% target, despite recent worries of inflation running too hot. While rising prices are a concern now as the global economy reopens, aggressive monetary policy actions over the last decade have been largely unsuccessful at raising inflation above 2% in many advanced economies, thanks to factors such as aging populations, technological innovation, and globalization. Bloomberg

U.S. Economic Indicators

The NFIB Small Business Optimism Index rose to 98.2 in March as seven components improved and three weakened. The uptick in the index was primarily driven by an increase in the shares of small businesses with expectations for improving economic conditions and expectations for higher future sales. NFIB Report

Consumer prices rose 0.6% in March (up 2.6% from a year ago). The “core” CPI, which excludes food and energy, edged up 0.3% in March and has risen 1.6% since last year. BLS Report