Core PCE Price Index (Y/Y)
5.3 pts to 102.5
Macro Indicators Execution Tab: 11 of 20
The number of new unemployment claims rose by 3,000 to 217,000 in the week ending October 22. Continuing claims rose 55,000 to 1.44 million in the week of October 15 and the insured unemployment rate was 1.0%, virtually unchanged from the previous week’s rate.
With continued gains in spending on durable goods and services, consumer spending rose 0.6% in September, slightly ahead of expectations. Technically known as personal consumption expenditures (PCE), consumer spending is the largest component of GDP, accounting for more than 70% of the US economy. Aggregate personal income (the ability to spend) increased by 0.4%. The savings rate fell to 3.1%, suggesting that consumers are reducing their savings to finance consumption. Compared to last September, consumer spending increased by 1.9% year-on-year (a slowdown), while personal income it was lower by 2.9% year-on-year. The PCE price index advanced 6.2% year-on-year, the same as last month. However, excluding food and energy, the core PCE price index (the Fed’s preferred measure of inflation) accelerated to a 5.1% year-on-year rate, suggesting a tightening later on
The Conference Board Consumer Confidence Index® fell — 5.3 points to 102.5 — in October after two consecutive monthly gains. Consumers’ assessment of current business conditions deteriorated, as did their assessment of the labor market, with fewer saying jobs were “plenty” and more saying they were “hard to come by” in September. The expectations component, which is based on consumers’ near-term outlook for income, business and labor market conditions, was somewhat mixed and remains at a low level, indicating a risk of recession. Inflation concerns are rising again. Vacation plans were lower, but plans to buy cars, homes and appliances were up. Inflation concerns moderated to their lowest level so far this year.
Sale of new homes it fell by 11% in September and by almost 18% year-on-year. Compared to August, sales were higher in the Northeast and Midwest regions, while the South and West regions experienced declines. The number of new homes available for sale at the end of August increased for the tenth month in a row. The inventory of new homes reached 9.2 months, higher than the 8.1 recorded in August.
New ordersfor durable goods it increased by 0.4% in September compared to August. Transportation teams drove much of the increase. Excluding transport, orders for durable goods fell 0.5%. A gauge of business investment, “core” new orders (new orders for capital goods minus civilian aircraft and defense capital goods) fell 0.7% in September.
In the first of three estimates and subject to further revisions as more complete data become available, the BEA reported GDP in the third quarter rose at a seasonally adjusted annual rate (SAAR) of 2.6%. The gain mainly reflects higher exports (mostly more oil and product exports) and higher consumer spending (more on services than goods) that were partially offset by lower investment in housing (especially single-family construction) and a lower investment in private inventory. Positive contributors to the overall gain in real GDP also included gains in nonresidential fixed investment and federal spending (led by defense spending), state and local spending (reflecting increased employee compensation), and a decrease in imports. The estimated third-quarter real GDP gain follows a 0.6% decline in the second quarter and a 1.6% decline in the first quarter. Compared to the third quarter of 2021, real GDP was 1.8% higher. The PCE price index accelerated 4.2% in the third quarter to a 6.3% year-over-year pace, while core prices (excluding food and energy) fell to a year-over-year gain of 4 .9%
Oil prices were higher than a week ago as oil demand firmed. However, gas prices in the US remained stable. The combined oil and rig count rose by two to 769 for the week ending 10/21.
For the chemical business, indicators still recall a yellow banner for basic and specialty chemicals.
According to data published by the Association of American Railroads, chemical wagon loads they rose 1.0% to 31,593 for the week ending October 22. Charges were down 1.0% y-o-y (13-week MA), up 2.6% year-over-year, and have been rising for seven of the past 13 weeks.
The banner colors represent observations about the current conditions of the global economy and business chemistry. For the global economy, we keep a running tab of 20 indicators. The banner color for the macroeconomic section is determined as follows:
Green: 13 or more positive
Yellow: between 8 and 12 positive
Red: 7 or less positive
Fewer indicators are available for the chemical industry. As a result, we rely on the judgment of whether production in industry (defined as chemicals excluding pharmaceuticals) has increased or decreased for three consecutive months.
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