After a Rough Patch, Some Smoother Sailing
We’ve seen data this week that shows positive signs for the consumer, which is a vital barometer of the economy’s health. That outweighed some mixed data from the manufacturing sector.
The Census Bureau reported this week that retail sales were up 0.5 percent for May, after a strong 1.3 percent gain in April. Over the last 12 months, retail sales are up 2.5 percent.
The American Institute for Economic Research’s calculation of discretionary spending, which uses this national data, showed that category was up 0.3 percent in May, and 2.7 percent over the last year, led by restaurants, a broad category of sporting goods, hobby, books and music, and by building materials, garden Equipment and supply dealers .
Online shopping was up for the second month in a row – and is up 12.2 percent for the past year, and even staples excluding gas showed strength in the last two months. “That’s definitely a good sign for consumers, and for second-quarter GDP,” said Bob Hughes, senior research fellow at AIER.
There was also some positive news from the Empire State Manufacturing Survey, conducted by the New York Fed. The overall business conditions index – where zero is neutral – beat expectations in June, coming in at about 6, up from a negative 9 in May. Hughes said the survey shows some improvement in general business conditions for New York state manufacturers.
The Federal Reserve also released the May industrial production report this week, which posted a 0.4 percent decline, and a 1.4 percent decline over the last 12 months. The manufacturing sector, which makes up most of industrial production, was down 0.4 percent for the month, and was essentially flat from a year ago.
Overall, the new economic data this week continues to be mixed with a slight tilt to the upbeat side, Hughes said.
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