The Conference Board’s Composite Index of Leading Economic Indicators increased 0.3% m/m (3.9% y/y) in July following an unrevised 0.6% m/m rise in June. A 0.3% monthly rise had been expected in the Action Economics Forecast Survey. Three-month growth increased to 5.1% (AR) versus 4.8% in June, pointing to improvements in economic activity in the second half of this year.
Eight of the ten component series contributed positively to the leading index in July. Building permits subtracted meaningfully while the average workweek was neutral. The remaining made positive contributions: weekly unemployment claims, new orders for consumer goods, nondefense capital goods orders, ISM new orders index, equity prices, the leading credit index, the interest rate spread, and consumer expectations.
The Index of Coincident Economic Indicators also rose 0.3% m/m (1.9% y/y) in July following a downwardly revised 0.1% m/m gain in June. The July rise strengthened this index’s three-month growth to 2.5% (AR), its best since December 2016. Each of the component series contributed positively to the latest increase, including payroll employment, real personal income less transfers, industrial production, and manufacturing and trade sales.
The two important charts from Advisor Perspectives. No recession in sight.
U.S. Industrial Output Up Modestly in July Cooling auto sales have led to a drop in production at U.S. factories, constraining a key driver of economic growth in recent years.
U.S. manufacturing production has fallen two of the last three months, including a 0.1% dip in July, the Federal Reserve said Thursday. The decline partly offset big gains in mining and utility production, which pushed overall U.S. industrial output—a major indicator of the economy’s health—to rise 0.2% last month.
The biggest factor behind the factory sector’s latest softness has been a sharp drop in manufacturing of new vehicles. Auto output has fallen three consecutive months and 4% over the year. (…)
Auto makers built 1.9% fewer vehicles during the first seven months of 2017 compared with the same period a year ago, according to WardsAuto.com, an automotive data and information provider. Industry output sharply declined in July as unsold inventory levels remain near record highs. (…)
Utes and mining (O&G) are the only bright spots. Everything having to do with consumers and biz are flat at best. (Table from Haver Analytics)
Canada Inflation Accelerated in July Consumer-price index rise of 1.2% marked first time in six months annual inflation accelerated from previous month
The all-items consumer-price index in July rose 1.2% from a year earlier, Statistics Canada said Friday, following a 1% advance in the previous month.
On a seasonally adjusted basis, Canada’s CPI rose 0.2% in July from the previous month.
Meanwhile, the average annual rate of core inflation, based on three gauges used by the Bank of Canada, rose 1.5% in July, versus a 1.4% gain in the previous month. The three measures of core inflation—which aim to get a better read on underlying price pressures in the economy—ranged from 1.3% to 1.7%. Two of those measures accelerated from the previous month.
A Pillar of Chinese Growth Starts to Show Cracks Housing prices rose more slowly in China’s interior for the second time in two months—a potentially worrying sign for growth following a raft of weak data in July.
(…) Prices in the multitude of medium-size cities in China’s vast interior, which account for as much as 70% of the country’s housing market by floor space, rose at a slower pace for the second month in a row. (…)
The deceleration in growth, from a rise of 0.9% on the month in June to just 0.6% in July, is relatively minor. (…)
The biggest bullish factor for Chinese construction remains intact: Massive housing inventories, which depressed construction growth for years, are still falling. Vacant, unsold housing floor space in China fell 10 million square meters in July to the lowest level since February 2014, according to data released earlier in the month. Vacant floor space is down 20% on the year. (…)