Market Briefing

  • US Economy
  • Housing
  • Power Tool Industry
  • Distribution
  • Canada
  • Market Trends
  • PDF
  • US Economy
  • Housing
  • Power Tool Industry
  • Distribution
  • Canada
  • Market Trends
  • PDF

US Economy

US Economy December 2022

12/12/2022

 
Picture
Stocks soared at the end of the month as investors were encouraged by remarks by Fed Chairman Jerome Powell that seemed to confirm that the rate and pace of interest rate increases could slow down as inflation cools off.
 
Consumer Spending Rises 0.8%

Consumer spending rose 0.8% in October after rising 0.6% in September. The increase was about twice as much as economists expected. Core consumer spending rose 0.5% in October after rising 0.3% in September. Spending on goods increased 1.4%, driven by purchases of motor vehicles, furniture and recreational goods. Outlays on services gained 0.5%, lifted by spending at restaurants and bars, as well as on housing and utilities. Strong wage gains and holiday promotions fielded in October helped fuel spending. Personal income rose 0.7%, the most in a year. Disposable income, adjusted for inflation, rose 0.4%. Consumers also tapped into savings to fund purchases. The savings rate dropped to 2.3%, the lowest since July 2005, from 2.4% in September. The saving rate was as high as 26.3% in March 2021. It is now near levels seen during the 2007-09 Great Recession.
Picture
  • The unemployment rate held steady at 3.7% in November after rising in October. Unemployment was 3.5% at the beginning of the pandemic in March 2020.
  • The economy added 263,000 new jobs*, well above expectations, after adding 261,000* new jobs in October.
  • Employers have already replaced all of the 22 million jobs lost during the pandemic and added 4 million jobs during the first ten months of the year.
  • A cooling job market will help the Federal Reserve avoid a recession and achieve the elusive soft landing for the economy.
  • The October Job Openings and Labor Turnover Survey (JOLTS) from the Bureau of Labor Statistics may indicate that the hiring frenzy is starting to die down. Job openings fell to 10.33M and are nearly 7% lower than last year. The number of workers quitting their job fell for the sixth time in seven months. Fewer voluntary departures reduce job openings and should help ease wage pressures.

Chicago PMI Drops to 37.2
The Chicago PMI dropped sharply to 37.2 in November after falling to 45.2 in October. It was the lowest level for the PMI since the onset of the pandemic in 2020. Economists had expected the PMI to rise into the 47+ range. A PMI number above 50 signifies expanded activity over the previous month; readings below 50 signify contraction. Looking back to when the series began in 1967, the PMI has ranged from 20.7 in June 1980 to 81.0 in November 1973.   
       
Wholesale Prices Rise 0.2%
The Producer Price Index (PPI) rose 0.2% in October, below the 0.4% estimate. The PPI rose 0.4% in September. A significant contributor to the slowdown in wholesale inflation was a 0.1% decline in services, the first outright decline in that measure since November 2020. On a year-over-year basis, PPI rose 8% compared to an 8.4% increase in September.
 
Q3 GDP Rises 2.9%
Q3 GDP rose an upwardly revised 2.9%, according to the second reading from the Commerce Department. Upward revisions in consumer and business spending accounted for much of the revised growth. Residential investment contracted for the sixth consecutive quarter. When measured from the income side, the economy grew at a 0.3% rate. Gross domestic income (GDI) had contracted 0.8% in the second quarter. In principle, GDP and GDI should be equal, but in practice they generally diverge as they are estimated using different and largely independent source data. The average of GDP and GDI, also referred to as gross domestic output and considered a better measure of economic activity, increased 1.6% in the third quarter after shrinking 0.7% in the second quarter.
 
Real personal consumption expenditures (PCE), which account for roughly two-thirds of spending, rose an annualized 1.4% in Q3. Spending on durable goods, which tends to be sensitive to higher interest rates, edged down by 0.8%, while spending on non-durable goods slid 1.4%. Spending on services, which is still being boosted significantly by pent-up demand, grew 2.8%. Rapidly rising mortgage rates contributed to residential investment plunging by more than 26% in Q3. Residential investment has declined by more than 15% since peaking in early 2021.

Next Section
© Robert Bosch Tool Corporation.  All rights reserved, no copying or reproducing is permitted without prior written approval.


    Archives

    January 2025
    December 2024
    November 2024
    October 2024
    September 2024
    August 2024
    July 2024
    June 2024
    May 2024
    April 2024
    March 2024
    February 2024
    January 2024
    December 2023
    November 2023
    October 2023
    September 2023
    August 2023
    July 2023
    June 2023
    May 2023
    April 2023
    March 2023
    February 2023
    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016

    Picture
    Picture
    Picture
    Picture
    Picture
    Picture
    Picture


    ​Contact Us

Proudly powered by Weebly