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Economy in Brief
Philadelphia Fed Manufacturing Growth Continues; Pricing Pressure Eases
The Philadelphia Federal Reserve reported that its General Factory Sector Business Conditions Index dipped to 22.2 during October...
U.S. Initial Claims for Unemployment Insurance Ease
Initial claims for unemployment insurance fell to 210,000 (-8.7% y/y) during the week ended October 13...
U.K. Retail Sales: Doing Well-As-Can-Be-Expected Despite September Drop
U.K. retail sales and growth have all held up remarkably well- so far...
U.S. Housing Starts Decline
Total housing starts fell 5.3% during September to 1.201 million units (AR)...
U.S. Mortgage Loan Applications Continue to Decline As Interest Rates Rise
The MBA total Mortgage Applications Index fell 7.1% (-23.3% y/y) in the week ending October 12...
by Tom Moeller August 11, 2005
The Small Business Optimism Index reported by the National Federation of Independent Business (NFIB) rose a slight 0.3% in July following no change the month prior.
During the last ten years there has been a 64% correlation between the level of the NFIB index and the two quarter change in real GDP.
The slight rise reflected a reversal of the prior month's contradictory indications. In July a greater percentage of firms expected higher real sales in six months and a lower percentage expected the economy to improve.
The job outlook improved as the percentage of firms planning to raise employment recovered half of the prior month's decline an continued an up trend in place since April. The percentage of firms with one or more job openings also rose slightly. During the last ten years there has been a 67% correlation between hiring plans and the three month growth in nonfarm payrolls.
The percentage of firms planning to raise capital spending fell as did the percentage of firms raising average selling prices rose.
About 24 million businesses exist in the United States. Small business creates 80% of all new jobs in America.
| Nat'l Federation of Independent Business | July | June | Y/Y | 2004 | 2003 | 2002 |
|---|---|---|---|---|---|---|
| Small Business Optimism Index (1986=100) | 101.1 | 100.8 | -4.5% | 104.6 | 101.3 | 101.2 |
