Data Updates

Data Updates

August 2008

  • 08.29.2008
  • Personal Income
  • Nominal personal income fell 8.5 percent (annualized rate) in July, following a mere 0.7 percent increase in June. This month’s decline was largely due to the end of the fiscal stimulus check distribution, as personal current transfers fell 57.7 percent in July. Employee compensation rose 3.2 percent during the month, and is up 4.0 percent over the last year. Disposable personal income fell 1.1 percent (nonannualized) in July, though the BEA said that excluding the rebate checks, disposable personal income rose 0.5 percent. Nominal personal consumption increased by 2.9 percent (annualized rate) in July, however after adjusting for price effects, consumption fell 4.6 percent during the month. Over the past 12 months, real personal income is up just 0.7 percent, its slowest growth rate since October 1991.
  • 08.29.2008
  • PCE
  • The PCE price index jumped 7.9 percent (at an annualized rate) in July and was driven largely by a rapid increase energy prices. Over the past three months, the PCE price index has risen 7.5 percent. The PCE price index excluding food and energy components (core PCE) rose 3.3 percent during the month, following a 3.1 percent increase in June. The 12–month growth rate for core PCE stands at 2.4 percent, up 0.1 percent from last month.
  • 08.29.2008
  • Consumer Sentiment
  • The University of Michigan’s index of consumer sentiment was revised up in the final estimate for August, from an index value of 61.7 to 63.0. The revision was due to upward changes in both the current conditions and consumer expectations components. The one–year–ahead average inflation expectations was revised down to 5.3 from 5.5 percent, while the longer–term average expectations (5–10 years ahead) were adjusted up 0.1 percentage points to 3.9 percent.
  • 08.28.2008
  • Real GDP
  • Real GDP advanced at an annualized rate of 3.3 percent in the second quarter, according to the preliminary release from the Bureau of Economic Analysis. This is an upward revision of 1.4 percentage points from the advance estimate. This is an extremely large revision when compared to the absolute average (the average without regard to sign) advance–to–preliminary revision of 0.5 percentage point over the last 20 years. The upward revision was, in large part, due to favorable adjustments to net exports. Exports increased 13.2 percent in the second quarter, revised up from an increase of 9.2 percent. At the same time, imports (which subtract from GDP growth) were revised down from a decrease of 6.6 percent to a fall of 7.5 percent. All told, the revision to net exports added 3.1 percentage points to real GDP growth in the second quarter, an additional 0.7 percentage point over the advance estimate. The sell–off in private inventories was not as dramatic as the advance release made it out to be, only subtracting 1.4 percentage points from second quarter growth, as opposed to a 1.9 percentage points take–away. Consumption growth was also revised up, increasing 1.7 percent in the second quarter (up from 1.5 percent in the first quarter), while the investment picture was largely unchanged from the advance release.
  • 08.27.2008
  • Durable Goods
  • New orders for durable goods increased 1.3 percent (nonannualized) in July, rising much higher than expectations and matching a 1.3 percent increase in June. Nondefense capital goods orders excluding aircraft rose 2.6 percent in July, doubling June’s increase of 1.3 percent. Over the past 12 months, the series is up 6.3 percent. Shipments of durable goods increased 2.5 percent in July, while unfilled orders rose 0.8 percent during the month. Inventories continued to rise in July, adding 0.8 percent. Over the past year, inventories have grown 7.1 percent.
  • 08.26.2008
  • New Home Sales
  • New home sales increased 2.4 percent in July, following a 2.1 percent decline in June. Over the past three months, new home sales have been basically flat, however over the past six months, sales are still down 13.7 percent. That’s an improvement over the 6-month growth rates we’ve seen over the last year, which dipped as low −26.6 percent, but still not a substantial enough improvement to warrant much optimism going forward. The 12–month growth rate increased slightly to −35.3 percent in July, but remains close to its recent low of −40.2 percent. The number of new single–family homes for sale continued to decline in July, dropping 5.3 percent, the largest decline since 1963. Coupled with the increased sales pace, the decline helped bring the months of supply at the current sales pace down from its recent highs but at 10.1 months this measure of inventory remains elevated.
  • 08.26.2008
  • S&P/Case-Shiller Home Price Index
  • The quarterly S&P/Case–Shiller home price index continued to decline in the second quarter, but did so at a slower rate than in previous quarters. The four–quarter growth rate fell to a new low of −15.4 percent down from −14.2 percent in 2008:Q1. The series is not seasonally adjusted, so quarter-to-quarter moves shouldn’t be given all that much weight. But for the sake of comparison; in the second quarter Case-Shiller home prices fell an annualized 9.0 percent compared to annualized declines of 19.9 percent and 24.3 percent in the 2007:Q4 and 2008:Q1, respectively. The other major home price index, published by the Office of Federal Housing Enterprise Oversight (OFHEO) also continued to decline in the second quarter, but with no significant change in pace compared to previous quarters. The four-quarter growth rates in both the purchase only index, which doesn’t include refinancing data, and the total index, which does, dropped to new lows at −4.8 percent and −1.7 percent, respectively.
  • 08.25.2008
  • Existing Home Sales
  • Both total existing home sales and single–family sales increased 3.1 percent in July, furthering hopes that the housing market is beginning to stabilize. Through the first seven months of 2008, existing single–family homes increased in four months, compared to a total of just three monthly increases in 2006 and two in 2007. In fact, existing single–family home sales have been fairly stable since September of 2007, bouncing around between an annual sales pace of 4.4 million and 4.3 million. Positive news aside, the 12–month growth rate in sales, while up from a low of −22.9 percent in February, is still substantially negative at −12.4 percent and inventories remain near their recent peaks. The high level of inventories in particular puts a dour note on this report, as it points to the potential for continued stress in the housing market.
  • 08.19.2008
  • PPI
  • The Producer Price Index (PPI) increased 15.5 percent (annualized rate) in July, following a 23.8 percent jump–up in June. Over the past three months, the PPI rose 18.9 percent. While energy components—rising 43.6 percent in July—pushed up the overall PPI, excluding food and energy components (core PPI), the series rose 8.2 percent. Over the past 12 months, the core PPI has increased 3.6 percent, its largest growth rate since May 1991. Further back on the production line, core intermediate–goods and core crude–goods prices were elevated in July, rising 27.2 percent and 50.2 percent, respectively.
  • 08.19.2008
  • Housing Starts
  • Total housing starts fell 11.0 percent in July, reversing June’s gain of 10.4 percent. These changes in overall starts were primarily caused by wild fluctuations in the more volatile multi–family starts series, which rose 41.3 percent in June, only to fall back 23.6 percent in July. Single–family housing starts fell 2.9 percent in July, following a 3.2 percent decline in June. However, the 90 percent confidence interval around July’s single–family starts number is plus or minus 10.9 percent, which encapsulates zero, so we can not be sure that the series has changed at all from the previous month. That said, the 12–month growth rate in single–family starts is −39.2 percent, slightly above April’s cyclical low of 43.2 percent.
  • 08.15.2008
  • Industrial Production
  • Industrial production increased in line with expectations, rising 2.7 percent (annualized rate) in July, following a downwardly revised 4.9 percent in June. Over the past year, however, industrial production has decreased 0.1 percent. The production gains in July were led by an 11.4 percent increase in mining output and a 4.8 percent rise in manufacturing production. Utilities output fell 20.8 percent in July after a 31.0 percent gain the previous month.
  • 08.15.2008
  • Consumer Sentiment
  • The University of Michigan–s index of consumer sentiment continued to improve in August (albeit slightly), rising 0.5 point to 61.7, up from its recent low of 56.4 in June. The recent gains are most likely tied to pull–back in commodity and energy prices over the last month or so. That easing of commodity price pressures is also helping to improve the one–year–ahead average inflation expectations, which fell to 5.5 percent in August from 6.3 percent in July. Longer–term average expectations (5–10 years ahead) ticked–up 0.2 percentage point to 3.8 percent. However, it is worth noting that the median longer–term inflation expectations remained flat at 3.2 percent.
  • 08.14.2008
  • CPI
  • The CPI rose at an annualized rate of 10.3 percent in July, much higher than expected, as energy and commodity prices continued to surge. The 12–month growth rate in the CPI stands at 5.6 percent, its largest increase in 17 years. The core CPI was also elevated in July, rising 4.0 percent, following a 3.9 percent increase in June. Measures of underlying inflation trends computed by the Federal Reserve Bank of Cleveland also rose: The median CPI rose 4.7 percent, and the 16 percent trimmed–mean CPI rose 7.2 percent. Over the past 12 months, the median CPI has increased 3.3 percent, while the 16 percent trimmed–mean measure is up 3.6 percent. An investigation into the component price change distribution yields some information about the nature of the price increases. Sixty percent of the CPI's components rose at rates exceeding 3.0 percent, while 47 percent rose at rates greater than 5.0 percent.
  • 08.13.2008
  • Retail Sales
  • Total retail sales fell 1.5 percent (at an annualized rate) in July, following an upwardly revised 4.3 percent gain in June. Over the past three months, retail sales are up 4.1 percent. Sales at motor vehicle and parts dealers fell 25.4 percent during the month and were a significant drag on the overall number, as retail sales excluding autos rose 5.7 percent. Sales at grocery stores rose 4.1 percent in July, while sales at gas stations increased 9.8 percent. Gains at both were likely driven by price effects. Elsewhere, sales at furniture, home furnishing, electronics, and appliance stores jumped up 11.1 percent in July. Over the past three months, sales at these stores have increased 3.9 percent.
  • 08.13.2008
  • Import Prices
  • Import prices, which have been surging since March, rose 22.7 percent in July. The only comforting thing is that this is the first monthly price increase under 40 percent (annualized rate) in five months. Both petroleum and nonpetroleum prices contributed to the overall price gain, rising 60.4 percent and 11.0 percent, respectively. Export prices remain elevated as well, rising 18.5 percent in July after a 13.2 percent increase in June. Over the past 12 months, export prices are up 10.2 percent.
  • 08.12.2008
  • International Trade
  • The nominal trade deficit declined $2.4 billion in June, as exports increased 4.0 percent and imports increased by 1.8 percent. The increase in exports was the largest since 2004 and was driven by increases in excess of 5.0 percent in four out of the five major categories : foods, feeds and beverages, industrial supplies and materials, automotive vehicles and parts, and consumer goods. The fifth major category, capital goods excluding automobiles, increased 3.0 percent over the month. Despite consecutive monthly declines, the nominal trade deficit was up a slight $1.6 billion dollars in the second quarter as a whole, but is still down nearly $21 billion (on a quarterly basis) from its all–time high in 2006.
  • 08.08.2008
  • Productivity and Costs
  • Nonfarm business sector productivity (output per hour of all persons) rose at an annualized rate of 2.2 percent in the second quarter, according to the preliminary release, following a 2.6 percent last quarter. Over the past four quarters productivity in the nonfarm business sector increased 2.8 percent. Compensation per hour rose 3.6 percent in the second quarter, down from a 5.2 percent increase in the first quarter. After adjusting for price effects, real compensation per hour fell 1.4 percent, its first decrease in a year. Unit labor costs, a measure some use to detect the onset of inflationary pressures, increased 1.3 percent during the second quarter, down from 2.5 percent last quarter. Over the past four quarters, unit labor costs are up 1.5 percent.
  • 08.04.2008
  • Personal Income
  • Nominal personal income was virtually flat in June, rising just 0.7 percent (at an annualized rate), after posting a stimulus-driven 24.2 percent increase in May. According to the BEA’s release, the federal government—in accordance with the Economic Stimulus Act of 2008—issued rebate checks totaling $77.9 billion in the second quarter (with $48.1 billion issued in May). These rebates helped push disposable personal income up 16.0 percent in the second quarter. Excluding the stimulus effects, disposable personal income rose 0.3 percent (nonannualized) in June, following a 0.4 percent (nonannualized) increase in May. Nominal personal consumption rose at an annualized rate of 7.0 percent in June. The bulk of that spending was on consumer nondurables, which rose 17.1 percent (annualized rate). In comparison, spending on durables fell 16.4 percent during the month. However, after adjusting for price effects, real personal consumption was slightly negative, falling 2.3 percent in June. Over the past 12 months, real personal consumption has increased 1.2 percent.
  • 08.04.2008
  • Personal Consumption Expenditure Index
  • The PCE price index jumped up 9.5 percent (at an annualized rate) in June and was driven largely by a rapid increase energy prices. Over the past three months, the PCE price index has risen 4.2 percent, slightly higher than the 3.7 percent increase seen over the past 12 months. The PCE price index excluding food and energy components (core PCE) rose 3.2 percent during the month, following a 2.1 percent increase in May. The 12?month growth rate for core PCE stands at 2.3 percent, up 0.1 percent from last month.
  • 08.04.2008
  • Factory Orders
  • New orders for manufactured goods increased 1.7 percent (nonannualized) in June, following a 0.9 percent increase in May. New orders for nondefense capital goods excluding aircraft rose 1.2 percent during the month, reversing course from a 0.3 percent decrease in May. Shipments for all manufacturing industries increased 1.6 percent in June and are up 7.5 percent over the past year. Unfilled orders ticked up 0.9 percent during the month, in line with the average increase seen over the past six months. Inventories jumped 1.0 percent in June, the largest increase in six months.
  • 08.01.2008
  • Employment Report
  • Nonfarm payroll employment fell by 51,000 in July, following an upwardly revised loss of 51,000 in June and marking its seventh consecutive monthly decline. Since the beginning of the year, nonfarm payrolls have trimmed 463,000 jobs. Employment in the goods-producing fell by 46,000 in July, driven by widespread losses in construction (−22,000) and manufacturing (−35,000). Mining was the bright spot on the goods-producing side, adding 10,300 jobs, its largest monthly addition since December 1993. Private service-providing payrolls decreased 30,000 during the month, a slight acceleration from June’s loss of 17,000. The largest losses were seen in employment services (−34,200), wholesale trade (−16,900), and retail trade (−16,500). Financial sector employment was flat in July, which is somewhat surprising given the recent turmoil in financial markets. However, over the past 12 months, financial sector payrolls have fallen 118,000. Health care employment continued to rise, adding 32,900 workers in July and 368,100 over the past year.
  • 08.01.2008
  • Construction Spending
  • Total construction spending decreased 0.4 percent in June after being virtually unchanged in May. On the private side, construction spending decreased 0.4 percent, as a 0.8 percent increase in nonresidential construction was offset by a 1.8 percent decline in residential construction. The decline in private residential construction spending was the 27th consecutive decrease, during which time spending has fallen roughly 45 percent. Over that same time period, private nonresidential construction spending has increased in 24 months and is up about 43 percent.
  • 08.01.2008
  • ISM Manufacturing
  • The ISM manufacturing remained virtually unchanged at 50.0 in July, straddling the threshold which indicates whether or not the manufacturing economy is expanding, according to the ISM. The overall ISM diffusion index gives equal weights to five subindexes: new orders, production, employment, supplier deliveries, and inventories. The new orders index fell 4.6 points to 45.0 in July, its lowest reading since May 2001. The production index showed a slight increase, from 51.5 to 52.9. The employment index jumped 8.2 points off a five–year low of 43.7 to 51.9 during the month. This is surprising considering that nonfarm payrolls for manufacturing declined by 35,000 in July. The ISM also constructs indexes that do not factor into the composite manufacturing index, such as the prices index (not seasonally adjusted), which receded slightly from a recent high of 91.5 in June, to 88.5.