It’s Friday and that means it’s time to review the latest economic data and identify which pockets of the economy are heating up and which are slowing down. Don’t worry about catching every headline and every report throughout the week—I recap all of the most important news impacting your wealth right here every Friday. Let’s take a look at this week’s big headlines:
Beige Book Survey
The big news this week was the September Beige Book survey. In it, the Fed concluded that economic growth would continue at a moderate pace during the second half of the year. However, six of the 12 Fed districts reported tight labor markets, which is consistent with last week’s lackluster August payroll report. There is also evidence of deflation risk, as food and energy prices are expected to remain low for the next few months.
Initial Claims for Unemployment
For the week ending on September 3, initial claims for unemployment fell to 259,000. This represented a 1.6% decline from last week’s 263,000 claims. This was a better than expected result; economists had expected claims to rise to 265,000. Meanwhile, the four-week moving average fell by 1,750 to 261,250. For the past several months, jobless claims have remained near a four decade low. This is a positive sign, because jobless claims tend to correlate with layoff activity.
Consumer Credit Report
During the month of July, consumer credit rose by $17.7 billion, or by 5.8%. This outstripped the consensus estimate of a $16.0 billion increase. Breaking it down, non-revolving credit jumped 6.7% while revolving credit increased 3.5%. Auto financing accounted for most of July’s gain. Meanwhile, June’s results were revised higher to reflect a $14.5 billion increase, up from the previously reported $12.3 billion gain.
Wholesale inventories were flat in July, missing economists’ expectations for a 0.1% gain. This followed a 0.3% increase in June. In July, inventories of durable goods and machinery rose 0.3%, while non-durable goods dropped 0.3%. Wholesales fell 0.4% in July and the inventory-to-sales ratio fell from 1.33 to 1.32.
That’s all I have for you this week; I’ll be back online on Tuesday morning (after the holiday weekend) with your weekly ratings changes.
Have a great weekend,