Each month, idea5 releases its Monthly Economic Update so our clients stay up to date on national trends once the information has been made available. The following is our summary of market highlights from the past 30 days:
GDP, Consumer Confidence, PMI:
- The increase in real GDP (+3.2) partly reflected an increase in consumer spending on household services, notably on housing and utilities.
- Offsetting the contributions to growth, housing investment and state and local government spending declined.
- Consumer Confidence, which had declined in October, increased significantly in November.
- “A more favorable assessment of current conditions coupled with a more optimistic short-term outlook helped boost confidence”, said Lynn Franco, Director of Economic Indicators at the Conference Board.
- “And while the majority of consumers were surveyed before the presidential election, it appears from the small sample of post-election responses that consumers’ optimism was not impacted by the outcome.”
- Economic activity in the manufacturing sector expanded in November, and the overall economy grew for the 90th consecutive month.
Graph1: Gross Domestic Product:
- The unemployment rate declined to 4.6 percent in November, and total nonfarm payroll employment increased by 178,000.
- Employment gains occurred in professional and business services and in health care.
- The civilian labor force participation rate, at 62.7 percent, changed little in November, and the employment-population ratio held at 59.7 percent. These measures have shown little movement in recent months.
- 1.9 million persons were marginally attached to the labor force, up by 215,000 from a year earlier. These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months.
- In November, average hourly earnings for all employees on private nonfarm payrolls declined by 3 cents to $25.89, following an 11-cent increase in October. Over the year, average hourly earnings have risen by 2.5 percent.
Graph 2: Unemployment: U3 vs. U6 rate
Interest Rates, CPI, PPI, Money Supply:
- As in September, increases in the shelter and gasoline indexes were the main causes of the rise in the CPI index. The gasoline index rose 7.0 percent in October and accounted for more than half of the increase in the “All items” index.
- The energy index increased 3.5 percent, its largest advance since February 2013. The indexes for fuel oil and gasoline were up 5.9 percent and 7.0 percent, respectively, while the indexes for electricity and natural gas saw relatively smaller increases of 0.4 percent and 0.9 percent.
- In contrast, the index for food was unchanged for the fourth consecutive month, as the food at home index continued to decline.
- U.S. services sector activity hit a one-year high in November, with a surge in production boosting hiring, further evidence of strength in the economy that clears the way for the Federal Reserve to raise interest rates later this month.
Graph 3: CPI vs. PPI: Monthly % Change