Key Economic Indicators – June 18, 2018

·      Advance estimates of retail and food services sales for May were up 0.8% from the previous month, and were up 5.9% from May 2017. Excluding motor vehicle & parts, retail sales were up 0.9% from the previous month, and were up 6.4% from a year ago. Year-to-date, retail sales and food services were up 5.2% from the same period a year ago, while retail sales and food services excluding motor vehicle & parts were up 5.5%.

·      Total manufacturing and trade sales for April were up 0.4%, while inventories were up 0.3%. The total business inventories/sales ratio at the end of April was 1.35, compared with 1.38 in April 2017.

·      Total Industrial production decreased 0.1% in May, following a 0.9% increase in the previous month. The index of industrial production in May was 3.5% above its year-ago level. The rate of capacity utilization for total industry was 77.9%, 1.9 percentage points below its 1972-2017 average, but 1.7 percentage points above its level in May 2017.

·      The import price index increased 0.6% in May, The same increase as in the previous month. The overall import price index increased 4.3% from May 2017.  The export price index increased 0.6% in May, The same increase as in the previous month. The price index for overall exports increased 4.9% from May 2017.

·      The producer price index for final demand increased 0.5% in May, following an increase of 0.1% in the previous month. The price index for final demand excluding food and energy increased 0.3%, following a 0.2% increase in the previous month. The producer price index for final demand increased 3.1% from May 2017 to May 2018, while the index for final demand excluding food and energy increased 2.4%.

·      The consumer price index increased 0.2% in May, the same increase as in the previous month. The core index, all items less food and energy, increased 0.2%, following a 0.1% increase as in the previous month. The consumer price index increased 2.8% for the 12-month period ending in May, while the core index rose 2.2%.

·      Real average hourly earnings for all employees increased 0.1% from April to May. This result stems from a 0.3% increase in average hourly earnings being offset by a 0.2% increase in the consumer price index for all urban consumers.

·      The advance figure for initial claims for unemployment insurance decreased 4 thousand to 218 thousand in the week ending June 9. The 4-week moving average was 224.25 thousand, a decrease of 1.25 thousand from the previous week’s average. The advance number for seasonally adjusted insured unemployment (ongoing) during the week ending June 2 was 1,697 thousand, a decrease of 49 thousand from the previous week’s revised level. This was the lowest level for insured unemployment since December 1, 1973 when it was 1,692 thousand. The 4-week moving average was 1,726.75 thousand, a decrease of 3.75 thousand from the previous week’s revised average. This is the lowest level for this average since December 8, 1973 when it was 1,715.5 thousand.

·      Unemployment rates were lower in May in 14 states and stable in 36 states and the District of Columbia, according to the U.S. Bureau of Labor Statistics. Eleven states had jobless rate decreases from a year earlier and 39 states and the District had little or no change. Nonfarm payroll employment increased in 7 states in May and was essentially unchanged in 43 states and the District of Columbia. Over the year, 35 states added nonfarm payroll jobs and 15 states and the District of Columbia were essentially unchanged.

·      The federal government budget ran a deficit of $146.8 billion in May, after a surplus of $214.3 billion in April. In May, receipts decreased 9.7% from a year ago, while outlays increased 10.7%. The deficit in May of 2017 was $88.4 billion, $58.4 billion less than the deficit in May of 2018. The cumulative deficit for the first eight months of fiscal year 2018 was $532.2 billion, $99.4 billion more than the deficit of $432.9 billion for the same period of the previous fiscal year.

·      The results of Freddie Mac’s Primary Mortgage Market Survey showed average fixed mortgage rates rose to their second highest level this year. The 30-year fixed mortgage rate averaged 4.62% for the week ending June 14, up from last week when it averaged 4.54%. A year ago at this time, 30-year fixed mortgage rate averaged 3.91%. The 15-year fixed mortgage rate averaged 4.07% for the week ending June 14, up from last week when it averaged 4.01%. A year ago at this time, 15-year fixed mortgage rate averaged 3.18%.

·      Mortgage applications decreased 1.5% from a week earlier, according to data from Mortgage Bankers Association’s (MBA) Weekly Applications Survey for the week ending June 8th.

·      The June 2017 Empire State Manufacturing Survey indicated that business activity continued to grow strongly for New York manufacturers. The headline general business conditions index increased from 20.1 in May to 25.0 in June. The prices paid index remained close to last month’s multiyear high, indicating continued significant input price increases, and the prices received index remained elevated.

·      The Thomson Reuters/University of Michigan Index of Consumer Sentiment, preliminary, increased to 99.3 in early June, from the final reading of 98.0 in May. The Index was 95.0 in June of 2017. The Current Economic Conditions Index increased to 117.9 in June, from 111.8 in May, while the Index of Consumer Expectations decreased to 87.4, from 89.1.

·      The Federal Open Market Committee decided to raise its target for the federal funds rate by 0.25% to 1.75% to 2.00%. “The Committee expects that further gradual increases in the target range for the federal funds rate will be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee’s symmetric 2 percent objective over the medium term. Risks to the economic outlook appear roughly balanced.”

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