10 Things You Need To Know: September 4, 2024
Key data releases this week include: ISM Manufacturing (Tue), JOLTS Jobs Openings (Wed), factory orders (Wed), Beige Book (Wed), ISM Services (Thu), and nonfarm payrolls (Fri).
Haver
September 3, 2024
The ISM Purchasing Managers Index of activity in the manufacturing sector rose to 47.2 during August after declining to 46.8 in July. A reading of 47.8 in August had been expected in the Action Economics Forecast Survey. The prices index rose to 54.0 last month from 52.9 in July.
Haver
August 27, 2024
U.S. house prices dipped 0.1% m/m in June after being virtually unchanged in May, according to the Federal Housing Finance Agency (FHFA) House Price Index. The June HPI at 424.47 was 50.7% above a low of 281.69 in May 2020. The year-on-year rate of increase decelerated to 5.1% in June, the lowest since July 2023, from 5.9% in May.
Haver
August 29, 2024
Real GDP growth was unexpectedly revised up to 3.0% q/q SAAR in Q2 from the initially reported 2.8% advance. The Action Economics Forecast Survey had expected no revision to Q2. The upward revision was due completely to stronger personal consumption. It rose 2.9% in the second estimate, up from 2.3% in the advanced report.
Haver
August 29, 2024
Personal consumption expenditures (PCE) increased 0.5% (5.3% y/y) in July, after a 0.3% (5.4% y/y) rise during June. A 0.4% increase had been expected in the Action Economics Forecast Survey. Personal income rose 0.3% (4.5% y/y) in July after a rise of 0.2% (4.4% y/y) during June. A 0.2% gain was expected.
Haver
August 29, 2024
The PCE chain price index rose 0.2% in July following a 0.1% advance in June. The price index excluding food and energy rose 0.2% last month. The 2.6% y/y increase remained the weakest since March 2021. The three-month annualized core PCE index rose 1.7%.
Barron’s
September 3, 2024
Economists at the Conference Board estimated that an expected contraction in the quantity and quality of labor could reduce U.S. gross domestic product growth from a yearly average of 1.2% in the decade leading up to 2019 to a mere 0.3% in the decade ending in 2036. When the ratio of workers to retirees declines and production levels fall, GDP growth starts to slip.
Dan Close, head of municipal fixed income, Nuveen/ Barron’s
September 3, 2024
“If you have a Republican sweep, most likely all of the Tax Cuts and Jobs Act tax brackets would be extended. If we have a divided government, there might be some compromise on tax rates and tax brackets, but the highest marginal tax rates would be the most at risk for reversion higher. With a Democratic sweep, just the higher-income households and the higher tax brackets would be most likely to see income tax increases.”
Barron’s
September 3, 2024
Q2 earnings season is nearly complete, with more than 95% of S&P 500 companies having reported results. Earnings were up about 9% on nearly 5% revenue growth compared with second-quarter 2023. S&P 500 earnings are expected to rise 5% in the Q3 and 16% in Q4, according to consensus estimates. For 2025, Wall Street is penciling in 15% growth in S&P 500 profits.
Oxford Economics
September 3, 2024
There is concern that spending gains are not being matched by rising incomes. However, household balance sheets are healthy despite a lower saving rate. With the consumer still strong, the risks of a recession do not appear especially elevated, and this supports the case for the Federal Reserve to proceed with its rate-cutting cycle only gradually.