Economic Statistics for 27 Oct 11
Today’s economic statistical releases:
The big number today is obviously the advance estimate for 3rd quarter GDP. The BEA reported that GDP increased at an annualized 2.5% rate. The top three contributors to GDP growth were personal consumption expenditures, nonresidential fixed investment, and exports. So despite a bit of gloom as the economy slipped during the 2nd quarter, GDP, along with several other series of statistics, are showing a rebound.
The Kansas City Fed manufacturing index rose to 6 in September, up from 3 last month. The increase was mainly concentrated in durable goods.
Sadly, the rest of today’s numbers are a bit less cheerful.
Initial claims for unemployment held basically steady, though still unpleasantly high, at 402,000. The 4-week moving average dropped to 403,000 from 405,500 last week.
The Bloomberg Consumer Comfort Index fell to -51.1 last week, from -48.4 the previous week. This week’s reading is the lowest in the past month.
Contract signings are very weak for existing home sales, which shows ongoing trouble for housing and construction. Pending sales fell -4.6% in September, with weakness in all geographic areas. Weak consumer confidence combined with tight credit conditions are weighing down the market.
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Dale Franks
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I believe GDP estimates over the past 18 months have been revised downward nearly each and every time. My guess is the final # will be closer to 2%.
Despite that, I think we are in the low point of the trough or perhaps starting to climb out.
Exit Question: Can the economy improve enough over the next 10 months to save Pauline?
Magic 8 Ball says: NO
I’ll agree. The big advance was in personal consumption. If you recall, consumer confidence has been in the toilet, yet people are spending more?
I see a downward revision in the future for this one.
That said, government debt chews through 2.5% growth and then some. So the economy, outside of those at the government feeding trough, is almost certainly in recession. Not only it is most likely in recession, it probably recovered out of the past one.
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