Publications

U.S. Economic Indicators

The Empire State Manufacturing Survey indicates that business activity has steadied after two straight months of decline, as the headline index rose 48.3 points to -0.2. The new orders index rose 41.8 points to -0.6, the shipments index rose 42.3 points to 3.3, and the index for the number of employees rose 2.6 points to -3.5. NY Fed Report

U.S. News

The Financial Times reports that a drop in energy demand due to coronavirus has sent US exports of liquefied natural gas plummeting, with shipments of LNG from US ports expected to fall 60% in July from their peak in January. The United States has been pushed out of the market as US prices exceed those in Europe and Asia, though revenues from long-term contracts are helping to keep plant operators afloat for now. FT

The Washington Post reports that the surge in demand for gloves, masks, and disinfectants as businesses start to reopen has led to a dramatic increase in prices for these items, putting additional strain on businesses already hit by the initial lockdowns. Small businesses are among the hardest hit by the spike in prices, as they have no choice but to compete with larger companies with more purchasing power for limited protective resources or risk violating reopening protocols. WaPo

U.S. Economic Indicators

The University of Michigan Consumer Sentiment Index rose 6.6 points to 78.9 in the preliminary June reading but is down 19.3 points from June of last year. The Index of Consumer Expectations rose 7.2 points to 73.1, while the Current Economic Conditions Index rose 5.5 points to 87.8. University of Michigan

U.S. News

A recent survey by the Wall Street Journal found that more than two-thirds of economists expect the economic recovery to begin in the third quarter of 2020, though most expect the recovery to be slow and follow a gradual “swoosh” pattern. Projections for end-of-year unemployment and GDP growth improved slightly from the prior month’s survey, with December unemployment projected to be 9.6%, while 2020 GDP is forecast to shrink 5.9%. WSJ

The New York Times reports that lawmakers introduced bipartisan legislation this week that would invest billions of dollars over the next decade into the U.S. semiconductor industry – the latest effort in the shifting Washington consensus to combat Chinese technological ambitions. While congress has subsidized the semiconductor industry in the past, the current bill’s emphasis on domestic manufacturing is a consequence of the pandemic which has raised concerns of over-reliance on foreign electronics supply chains. NYT

U.S. Economic Indicators

The headline Producer Price Index (“PPI”) for final demand rose 0.4% in May but is down 0.8% year-over-year. The core – which removes the volatile prices of food, energy, and trade services – rose 0.1% in May but is down 0.4% from a year ago, the largest year-over-year decline since the index began in 2013. BLS Report

Initial jobless claims fell 355,000 to 1,542,000 last week. The four-week moving average decreased 286,250 to 2,002,000. DOL Report

U.S. News

According to the Financial Times, data published yesterday by Mastercard suggests that retail sales in the United States are picking up, with sales in home improvement, ecommerce, and groceries leading the recovery. Although May sales at many retailers are down year-over-year, this past month’s sales exceeded expectations and have consistently increased from the start of reopening, suggesting that consumer spending may be on the mend faster than expected. FT

U.S. Economic Indicators

Consumer prices fell 0.1% in May (up 0.1% from a year ago) after falling 0.8% in April. The “core” CPI, which excludes food and energy, fell 0.1% in May – marking an unprecedented three months of consecutive declines – and is up 1.2% from last year. BLS Report

U.S. News

Ahead of today’s FOMC meeting, the Wall Street Journal reports that the Fed is widely expected to reaffirm their intent to keep interest rates near zero for the foreseeable future, and to provide clarification on current Treasury purchasing policies. The central bank is also set to release projections for interest rates, unemployment, and inflation after forgoing the quarterly projections in March. WSJ

The Financial Times reports that the OECD expects a 6% contraction in the global economy by the end of 2020, cautioning that a second wave of coronavirus could knock 10% off output by the end of 2021 compared to previous projections. While the OECD notes that the pace of economic recovery will vary by country, they stress that global cooperation on treatment and vaccine development is critical to restore economic conditions and living standards to pre-pandemic levels. FT

U.S. Economic Indicators

The NFIB Small Business Optimism Index rose 3.5 points to 94.4 in May as eight components improved and two weakened. Sales expectations and plans to increase employment improved, while current job openings declined. NFIB Report

The Job Openings and Labor Turnover Survey (“JOLTS”) report indicated that the number of job openings fell 965,000 to 5.0 million in April. The number of hires decreased to a series low of 3.5 million, and the quits rate fell to 1.4 percent. BLS Report

U.S. News

The Washington Post reports that the U.S. officially fell into a recession in February per the National Bureau of Economic Research’s Business Cycle Dating Committee, formally marking the end of a record 128-month expansion. Recessions typically refer to two consecutive quarters of contraction, but the collapse in production and consumption activity from the coronavirus pandemic was severe and widespread enough for the committee to mark the downturn as a recession even if it ultimately proves to be relatively brief. WaPo