Category: U.S. Economy
Update Economic USA Employment
Job creation is an important factor in determining growth in the economy and current employment gains and unemployment rates are well within our forecast. The most recent ADP report shows a nice gain of 158,000. This number reflects the companies serviced by ADP. A broader measure is provided by the Bureau of Labor Statistics (BLS) and that number is also favorable showing a gain of 222,000. Levels above a 200,000 gain on the BLS number are considered expansionary.
Update Economic USA Personal Income
Personal income increased $67.1 billion which was better than the previous month increase of $58.4 billion. Disposable personal income increased by $71.7 billion which was also better than the previous month of a $56.5 billion increase. The Personal Consumption Expenditure measure also increased by $7.3 billion which is the favorite measure of the current Federal Reserve. The personal savings rate increased 0.2 percentage points to 5.5% up from 5.3%. Personal income data was encouraging and not necessarily inflationary.
Update Economic USA GDP
GDP or Gross Domestic Product is near the lower end of our forecast at 1.4%. As a comparison, we were at 2.1% GDP at the end of 2017. The economy has cooled slightly in the first quarter from a year ago, but confidence is high.
Update Economic USA Housing
Existing home sales moved up this month by 1.1% reaching an annualized rate of 5.6% over the previous 12 months. This activity is important because existing housing represents over 90% of all housing related activity. The median sales price increased as well by 5.8% to $252,800. When I see this number, I am constantly reminded of how much housing has increased over the years. It was not too long ago the median price had just moved beyond $100,000 and at the time it was considered an outlandish price to pay for a home.
Update Economic USA Housing
Housing starts fell 5.5% in May to 1.092 million units (annual rate). Residential permits also slowed by 4.9% to 1.168 million units. The construction of new homes has taken a pause over the past several months. This appears to be a short term slowdown rather than a longer term trend change in direction. The other economic factors in housing are all supporting a continuation of growth.