Investment Review & Outlook Archive |
RECENT INVESTMENT REVIEWS & OUTLOOK |
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The U.S. Economy – Some Mixed Signals but Doing Fine for Now: This past week, the Department of Commerce reported that Gross Domestic Product (GDP) for the second quarter of 2024 rose at an annual rate of 2.8%, much faster than the 1.4% pace during the previous quarter. This was also faster than the 2.1% rate expected by economists and was led by increased consumer spending, business capital investment and higher federal outlays. As the GDP report is backward looking during the period, recent data reflects some moderating growth trends, especially in June, with both manufacturing and non-manufacturing (services) contracting and consumer spending unchanged from May. Companies have been warning that consumers continue to feel the effects of high inflation and high borrowing costs. Noteworthy, consumer credit card debt continues to break records at a time when financing terms are as high as they have been in recent memory. On the labor front, the economy added an estimated 206,000 jobs during June, pushing nonfarm payroll creation above 1.3 million for the first half of 2024. However, a concern was the uptick in the unemployment rate that is now 4.1%. The labor market is finally showing signs of cooling. In addition, the decrease in the rate of average hourly wage growth over the last 12 months suggests inflation in the labor market is also slowing. Read More |