Publications

U.S. Economic Indicators

The ISM Manufacturing Index rose 1.6 points to 43.1 in May, indicating continued contraction in the manufacturing sector but at a slower rate than last month. The Employment Index rose 4.6 points to 32.1, while the New Orders Index rose 4.7 points to 31.8. ISM Report

Construction spending decreased 2.9% in April to an annualized rate of $1.35 trillion. Private construction fell 3.0% and public construction fell 2.5%. Census Bureau Report

U.S. News

A recent poll by the Washington Post found that a majority of Americans still favor controlling the spread of the coronavirus over restarting the economy – an indication that the virus remains a serious concern even as states move to lift stay-at-home restrictions. Americans remain starkly divided, however, on their level of comfort with resuming normal activities and personal fears about the virus, with sharp divisions by political party, race, and gender. WaPo

U.S. Economic Indicators

The U.S. Census Bureau Advance Economic Indicators Report shows that the goods deficit expanded to $69.7 billion in April from $65.0 billion in March, a 7.2% increase. Meanwhile, wholesale inventories rose 0.4% and retail inventories fell 3.6%. Census Bureau Report

Real disposable personal income increased 13.4% in April, while real personal consumption expenditures (PCE) fell 13.2%. The PCE price index fell 0.5% (up 0.5% Y/Y), and the core price index eased 0.4% (up 1.0% Y/Y). BEA Report

The University of Michigan Consumer Sentiment Index edged up 0.5 point to 72.3 in the final May reading but is down 27.7 points from May of last year. The Index of Consumer Expectations fell 4.2 points to 65.9, while the Current Economic Conditions Index rose 8.0 points to 82.3. University of Michigan

U.S. Economic Indicators

The second estimate of Q1 GDP indicates that the U.S. economy contracted at an annualized rate of 5.0%, a greater pace of contraction than the prior estimate of 4.8%. The latest reading reflects a downward revision to private inventory investment partly offset by upward revisions to consumer spending and business investment. BEA Report

New orders of manufactured durable goods fell 17.2% in April after falling 16.6% (revised) in March. Excluding transportation, new orders fell 7.4% last month after declining 1.7% the month before. Census Bureau Report

Initial jobless claims fell 323,000 to 2,123,000 last week. The four-week moving average decreased 436,000 to 2,608,000. DOL Report

The National Association of Realtors Pending Home Sales Index fell 21.8% in April (down 33.8% year-over-year). NAR reports that while coronavirus mitigation efforts have disrupted contract signings for the moment, buying activity is expected to rise as states reopen and more consumers feel comfortable with homebuying amid social distancing measures. NAR Report

U.S. News

The Wall Street Journal reports that a stark gap has emerged between the stock market and consumer sentiment, with stocks rebounding while consumers continue to be very negative about current economic conditions. A key explanation for the divergence may be that investors are betting on a quick recovery, helped by federal stimulus programs, while consumers are still feeling the pain of double-digit unemployment. WSJ

In an op-ed for the Financial Times, Robert Armstrong writes that global businesses – especially those in strategic, high-tech industries like semiconductor manufacturing – will be one of the main victims of deteriorating U.S.-China relations. Armstrong writes that fracturing between the two countries is likely to accelerate as COVID-19 reveals the costs of over-reliance on Chinese supply chains, requiring companies to prepare for a “two-track world” with separate corporate strategies for China and ex-China operations. FT

U.S. Economic Indicators

The Conference Board’s Consumer Confidence Index ticked up from 85.7 (revised) in April to 86.6 in May. Consumers’ assessment of current business and labor market conditions worsened, while near-term expectations for jobs, business conditions, and financial prospects improved. Conference Board Report

New home sales increased 0.6% in April to a seasonally adjusted annual pace of 623,000 but were down 6.2% from year-ago levels. The median sales price fell to $309,900 and the inventory of new homes edged down to 6.3 months at the current sales rate. Census Bureau Report

U.S. News

The Washington Post reports that surges in coronavirus cases at meat-processing plants around the country — despite improved worker protection measures — demonstrate how difficult it may be for many parts of the U.S. economy to return to ‘normal.’ In Iowa, Nebraska, and South Dakota, meat workers are responsible for 18%, 20%, and 29% of state coronavirus cases, respectively, emphasizing the predicament facing Midwest states as they work to ensure worker safety while keeping the country’s food supply chain operational. WaPo