Articles from Aaron Nathans
Amid all of the talk about a first-quarter economic slump, we have some new data out this morning that shows the economy is likely to show more strength in the second quarter.
“We’re seeing early signs that the soft patch might be ending,” said Bob Hughes, senior research fellow at the American Institute for Economic Research. “We expect it to be consumer-led.”
An important barometer of economic health, orders of durable goods, showed remarkable strength in headline March data released this morning by the Commerce Department. But a closer look into the 4 percent increase over February showed that strength was driven by two unique areas: transportation and technology.
Cut them out and focus mainly on manufacturing equipment and business investment, and the numbers don’t look nearly as rosy, said Theodore Cangero, data scientist at the American Institute for Economic Research.
This morning’s downward revision of the fourth-quarter GDP number, from an already less-than-stellar 2.4 percent down to 2.2 percent, might lead one to believe the economic outlook is weak.
But a look inside the numbers shows why things aren’t actually so bad, and why we believe the economy is poised for a stronger spring.
We’ve been highlighting some distinct medium- and longer-term trends in consumer prices lately: Energy prices have been markedly down. Service prices have been gaining while the prices of goods have not.
As we learned this morning with the monthly release of the Consumer Price Index, some of those trends took a vacation in February.