Publications

U.S. Economic Indicators

The third estimate of Q1 GDP indicates that the U.S. economy expanded at an annualized rate of 3.1%, unchanged from May’s second estimate. The reading reflects upward revisions to investment spending, exports, and government spending that were offset by downward revisions to consumer spending and private inventories. BEA Report

Initial jobless claims increased 10,000 to 227,000 last week. The four-week moving average rose 2,250 to 221,250. DOL Report

The National Association of Realtors pending home sales index rose 1.1% in May (down 0.7% Y/Y).  NAR reports that low mortgage rates have created extremely attractive conditions for prospective homebuyers. NAR Report

U.S. News

According to the Wall Street Journal, China has set a number of preconditions for the U.S. to meet before China will agree to resume negotiating a trade agreement. The preconditions include lifting the ban on the sale of U.S. technology to Huawei, removing all punitive tariffs on Chinese goods, and ending efforts to push China to purchase additional U.S. exports. WSJ

U.S. Economic Indicators

New orders of manufactured durable goods decreased 1.3% in May after falling 2.8% (revised) in April and are up 1.0% compared to a year ago. Excluding transportation, new orders rose 0.3% (up 1.5% from last year). Census Bureau Report

The U.S. Census Bureau Advance Economic Indicators Report shows that the goods deficit widened to $74.5 billion in May from $70.9 billion in April. Meanwhile, wholesale inventories rose 0.4% and retail inventories increased 0.5%. Census Bureau Report

U.S. News

The Wall Street Journal reports that a revival of U.S.-China trade talks will depend on the personal relationship between presidents Trump and Xi at this week’s G-20 summit. Insiders have cautioned against expecting a deal anytime soon, as discussions will be complicated by recent U.S. actions against Huawei and lingering security concerns. WSJ

According to the Washington Post, a new CBO report found that federal debt relative to GDP is on track to rise over the coming decades to its highest level since World War II. Public debt amounted to 78% of U.S. GDP in 2019, compared with just 35% in 2007, and is set to rise to 92% by 2030. WaPo

U.S. Economic Indicators

The Conference Board’s Consumer Confidence Index fell from 131.3 (revised) in May to 121.5 in June. Consumer Confidence declined after three consecutive monthly increases, as consumers’ assessment of business and labor market conditions became less favorable. Conference Board Report

New home sales fell 7.8% to a seasonally adjusted annual pace of 626,000 in May and are 3.7% below the May 2018 rate. The median sales price fell to $308,000 and the inventory of new homes rose to 6.4 months at the current sales rate. Census Bureau Report

U.S. News

Bloomberg reports that tariffs imposed by the U.S. on Chinese goods have caused production to shift to other countries, indicating that globalization is being disrupted but has not gone into reverse. Trade among major economies including the U.S., Japan, and South Korea has fallen sharply from last year amid fracturing global supply chains. Bloomberg

According to the Wall Street Journal, the U.S. Labor Department released a proposal to create a new type of apprenticeship program administered directly by business groups, labor unions, and educational institutions rather than the federal government. U.S. job openings in April outnumbered unemployed Americans by the largest margin since 2000; most U.S. jobs, however, are in private-sector service fields, which currently have few apprenticeship programs. WSJ

U.S. Economic Indicators

The Chicago Fed National Activity Index rose from -0.48 (revised) in April to -0.05 in May. The production category contributed positively, while the employment and housing & consumption categories contributed negatively and the sales, orders, & inventories category made a neutral contribution. Chicago Fed Report

U.S. News

The Financial Times reports that U.S. companies are increasingly looking for legal loopholes to avoid or reduce costs associated with tariffs on Chinese goods. Many companies are attempting to take advantage of the “321 de minimus rule,” which allows shipments worth less than $800 to be imported tariff-free. FT

According to the Wall Street Journal, eurozone employment has begun to cool as manufacturers cut back on hiring in response to weaker global demand, putting the region’s tenuous economic recovery in peril. Germany has been hit especially hard, as tensions between the U.S. and its trading partners have created uncertainty about where companies will locate production to avoid tariffs. WSJ

U.S. Economic Indicators

Initial jobless claims fell 6,000 to 216,000 last week. The four-week moving average rose 1,000 to 218,750. DOL Report

The Conference Board’s Leading Economic Index (“LEI”) was unchanged in May, following a 0.1% increase in April. Positive contributions from financial conditions and consumers’ outlook were offset by weakness in stock prices and manufacturing, with economic growth expected to moderate to 2.0% by the end of the year. Conference Board Report

U.S. News

The Wall Street Journal reports that home purchases by investors such as private-equity firms and real estate speculators have reached an all-time high, posing a challenge for first-time homebuyers. Growing home purchases by investors reflect strong consumer demand for rentals and unappealing alternate investments. WSJ

The Financial Times reports that Mexico has ratified the USMCA free trade deal even though the U.S. and Canada have yet to do so. President Trump’s administration is pushing Congress to ratify the agreement before their August recess but faces resistance from House Democrats concerned about labor standards, environmental provisions, and drug pricing components of the agreement. FT