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…
On Tuesday, the Conference Board announced that its consumer confidence index rose to 128 in May, up from a revised 125.6 in April. The present situation component rose to a 17-year high of 161.7 in May, up from 157.5 in April. Overall, consumer confidence is near a 17-year high; this bodes well for retail sales as well as overall economic growth.
First-Quarter Growth Domestic Product (GDP)
Speaking of GDP growth, on Wednesday, the Commerce Department revised down its first-quarter GDP estimate to a 2.2% annual pace. This was down from the 2.3% previously estimated; the downward revision was due to less inventory buildup than previously estimated. However, this lower inventory estimate is good news, since it implies that there will be higher inventory buildup in the second quarter.
The big economic news this week was Friday’s payroll report. The Labor Department reported that 223,000 payroll jobs were created in May. This was better than economists’ consensus estimate of 190,000. Meanwhile, March and April payrolls were revised up to 155,000 and 159,000, respectively. The unemployment rate in May declined to 3.8%; it is now at the lowest level since 1969. Average hourly wages rose by $0.08, or 0.3%, to $26.92 per hour. In the past 12 months, wages have risen at a 2.7% annual pace.
Finally, on Wednesday, ADP reported that 178,230 private payroll jobs were created in May. However, ADP significantly revised its March and April private payrolls lower to 198,470 and 162,990, respectively. Overall, the job market remains healthy, with hiring in construction, healthcare and manufacturing industries especially strong.
That’s all I have for you this week. I’ll be in touch again next week with the latest ratings out of Portfolio Grader.
Until next week,