Carol Stone, CBE

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727e.jpg" width="353">
It was looking promising in Japan: deflation was ending, finally, after almost 8 years. The most watched measure there, the core CPI excluding fresh food, had fallen from the middle of 1998 through April of 2006, according to the path of the year-over-year percent change. The overall amount of deflation wasn&#39;t all that bad: the index, seasonally adjusted, fell from a high of 103.4 in mid-1997 to a low of 99.9 in several months of 2005. But it was promising to see the index bottom out and begin to rise. The latter months of last year didn&#39;t see any big increase, but it really seemed that retailers were regaining some pricing power, necessary for the economy to sustain a self-reinforcing expansion.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727f.jpg" width="353">
But prices have not been able to sustain this new uptrend. This specific measure, the General CPI excluding fresh food has been down year-on-year since February, and today, the Ministry of Internal Affairs and Communications reported that June was a fifth consecutive month of decline, 0.1% from June 2006. This core index level is the blue line in the first graph.
The green line in that graph is a Western-style core index, the total less all food and energy. It highlights that the &quot;recovery&quot; we thought we saw in the other index was really concentrated in energy and that other prices continued down. The rate of decline eased in this index, but the year-on-year rate has never turned positive.
The June data show continuing weakness in housing, especially imputed rents, household furnishings, communications and reading &amp; recreation. Clothing and vehicle prices and public transportation charges have been edging marginally higher. Medical care and the &quot;miscellaneous&quot; category are up somewhat, the latter due mainly to an administered increase in tobacco prices.
With consumer prices unable to increase, it doesn&#39;t really seem surprising that retail sales have not risen either. The Ministry of Economy, Trade and Industry (METI) today reported a monthly decline of 0.8% for June, and a year-on-year reduction of 0.4%. Stores did have rising sales from 2003 through the middle of last year, a period when prices were falling. So price behavior isn&#39;t the only determinant. Individual store categories are showing mixed performances, with general merchandise outlets having persistent gains. But clothing stores saw notable drops in June, and motor vehicle dealers more than reversed a good April increase in May and June. Household appliance stores, facing a downtrend in home furnishings prices, have also been experiencing declining sales.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727g.jpg" width="353">
At the beginning of this month, the fabled TANKAN survey indicated that businesses were more optimistic in Q2. While this is generally true, the assessments of retailers have diminished. For &quot;all enterprises&quot; in retailing, the &quot;actual conditions&quot; measure turned weaker in Q2 2006 and has continued to deteriorate since, along with both prices and sales. Sigh.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">JAPAN</th>
<th scope="col">June 2007*</th>
<th scope="col">May 2007*</th>
<th scope="col">Apr 2007*</th>
<th scope="col">Year/ Year</th>
<th scope="col">2006</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">CPI, General</td>
<td>-0.1</td>
<td>0.2</td>
<td>0.2</td>
<td>-0.2</td>
<td>0.2</td>
<td>-0.3</td>
<td>0.0</td>
</tr>
<tr>
<td class="firstcol">CPI ex Fresh Food</td>
<td>0.0</td>
<td>0.1</td>
<td>0.1</td>
<td>-0.1</td>
<td>0.1</td>
<td>-0.1</td>
<td>-0.1</td>
</tr>
<tr class="odd">
<td class="firstcol">CPI ex Food &amp; Energy</td>
<td>-0.1</td>
<td>-0.1</td>
<td>0.1</td>
<td>-0.4</td>
<td>-0.4</td>
<td>-0.4</td>
<td>-0.6</td>
</tr>
<tr>
<td class="firstcol">&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr class="odd">
<td class="firstcol">Retail Sales</td>
<td>-0.8</td>
<td>0.6</td>
<td>0.3</td>
<td>-0.4</td>
<td>0.1</td>
<td>1.0</td>
<td>1.0</td>
</tr>
</tbody>
</table>
</body>
</html>

It was looking promising in Japan: deflation was ending, finally, after almost 8 years. The most watched measure there, the core CPI excluding fresh food, had fallen from the middle of 1998 through April of 2006, according to the path [...]

Japan: CPI and Retail Sales Weaken--Discouragingly

Tom Moeller

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727c.jpg" width="353">
The University of Michigan&#39;s reading of consumer sentiment this month rose 6.0% to 90.4, the highest level since February. The increase was less than the 8.3% gain reported in the preliminary report and it fell short of Consensus expectations for a reading of 91.5.
Consumer expectations contributed to the rise with a 9.1% jump m/m.
An improved expectation for business conditions during the next year contributed with an 11.7% m/m rise and an improved outlook for the next five years contributed with a 9.1% jump. Both these increases were much reduced from the preliminary report. <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727d.jpg" width="353">
An improved view of the current economic conditions contributed as it rose 2.6%. The view of current personal finances rose 4.5% (4.5% y/y) but the perspective of current buying conditions rose just 1.3% (-1.3% y/y).
The assessment of government policy improved 4.9% (4.9% y/y) after falling sharply during the prior two months.
The University of Michigan survey is not seasonally adjusted.The reading is based on telephone interviews with about 500 households at month-end.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@EF/@EF14/@EF1402/@EF1402.HTM">University of Michigan</a></th>
<th scope="col">July </th>
<th scope="col">July (Prelim.)</th>
<th scope="col">July y/y</th>
<th scope="col">June </th>
<th scope="col">2006</th>
<th scope="col">2005</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Consumer Sentiment</td>
<td>90.4</td>
<td>92.4</td>
<td>6.7% </td>
<td>85.3</td>
<td>87.3</td>
<td>88.6</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Current Conditions</td>
<td>104.5</td>
<td>105.7</td>
<td>1.0%</td>
<td>101.9</td>
<td>105.1</td>
<td>105.9</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Expectations</td>
<td>81.5</td>
<td>83.9</td>
<td>12.4%</td>
<td>74.7</td>
<td>75.9</td>
<td>77.4</td>
</tr>
</tbody>
</table>
</body>
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The University of Michigan's reading of consumer sentiment this month rose 6.0% to 90.4, the highest level since February. The increase was less than the 8.3% gain reported in the preliminary report and it fell short of Consensus [...]

Michigan Consumer Sentiment Up During July

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727a.jpg" width="353">
U.S. real GDP grew 3.4% (AR) last quarter. It was both the fastest growth since 1Q06 and exceeded Consensus expectations for a 3.2% rise. 
The estimates released today reflect the annual revision to the national income &amp; product accounts (NIPAs), beginning with the estimates for the first quarter of 2004. The release includes the revised quarterly estimates of GDP, corporate profits, and personal income. In general, real GDP growth was revised down as price inflation was revised up. 
Growth in final sales to domestic purchasers held about steady with 1Q at 1.7%. Growth in residential investment, however, collapsed for the fifth straight quarter. Perhaps showing some sign of reaching a bottom, the 9.2% annual rate of decline in housing during 2Q was roughly half the shortfalls during the prior year. Growth in personal consumption expenditures also moderated to a 1.3% (2.9% y/y) rate of growth versus an average 3.4% during each of the prior five quarters. Picking up the slack was a 2.3% (0.1% y/y) advance in business fixed investment in equipment &amp; software, the firmest in three quarters, and a 22.2% (11.5% y/y) jump in business investment in structures. Also rising quickly were government purchases with a 4.3% (2.0% y/y) rise after a 0.5% 1Q decline. 
An improved net export deficit added 1.6 percentage points to GDP growth. It occurred as exports boomed 6.4% (6.8% y/y) while imports fell 2.6% (+2.0% y/y).<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727b.jpg" width="353">
Somewhat faster inventory accumulation added 0.2 percentage points to 2Q GDP after subtracting from GDP during the prior two quarters.
The GDP chain price index rose 2.7% versus expectations for a 3.4% rate of gain. Growth in the PCE chain price index rose to 4.3% (2.3% y/y) due to a 10.0% jump in nondurables boosted by higher fuel costs. Less food &amp; energy the PCE chain price index grew 1.4% (2.0% y/y), its slowest rate of increase since 2003.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@E7/@E701/@E701.HTM">Chained 2000$, % AR</a> </th>
<th scope="col">2Q 2007 </th>
<th scope="col">1Q 2007 </th>
<th scope="col">Y/Y </th>
<th scope="col">2006 </th>
<th scope="col">2005 </th>
<th scope="col">2004 </th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">GDP</td>
<td>3.4%</td>
<td>0.6%</td>
<td>1.8%</td>
<td>2.9%</td>
<td>3.1%</td>
<td>3.6%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Inventory Effect</td>
<td>0.2%</td>
<td>-0.7%</td>
<td>-0.7%</td>
<td>0.1%</td>
<td>-0.2%</td>
<td>0.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">Final Sales</td>
<td>2.2%</td>
<td>1.9%</td>
<td>3.5%</td>
<td>2.8%</td>
<td>3.3%</td>
<td>3.3%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Foreign Trade Effect</td>
<td>1.6%</td>
<td>-0.2%</td>
<td>0.8%</td>
<td>0.1%</td>
<td>0.0%</td>
<td>-0.5%</td>
</tr>
<tr class="odd">
<td class="firstcol">Domestic Final Demand</td>
<td>1.7%</td>
<td>1.6%</td>
<td>1.7%</td>
<td>2.7%</td>
<td>3.3%</td>
<td>3.8%</td>
</tr>
<tr>
<td class="firstcol">Chained GDP Price Index</td>
<td>2.7%</td>
<td>4.2%</td>
<td>2.7%</td>
<td>3.2%</td>
<td>3.2%</td>
<td>2.9%</td>
</tr>
</tbody>
</table>


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U.S. real GDP grew 3.4% (AR) last quarter. It was both the fastest growth since 1Q06 and exceeded Consensus expectations for a 3.2% rise. The estimates released today reflect the annual revision to the national income & product [...]

US 2Q07 GDP Above Expectations

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727a.jpg" width="353">
U.S. real GDP grew 3.4% (AR) last quarter. It was both the fastest growth since 1Q06 and exceeded Consensus expectations for a 3.2% rise. 
The estimates released today reflect the annual revision to the national income &amp; product accounts (NIPAs), beginning with the estimates for the first quarter of 2004. The release includes the revised quarterly estimates of GDP, corporate profits, and personal income. In general, real GDP growth was revised down as price inflation was revised up. 
Growth in final sales to domestic purchasers held about steady with 1Q at 1.7%. Growth in residential investment, however, collapsed for the fifth straight quarter. Perhaps showing some sign of reaching a bottom, the 9.2% annual rate of decline in housing during 2Q was roughly half the shortfalls during the prior year. Growth in personal consumption expenditures also moderated to a 1.3% (2.9% y/y) rate of growth versus an average 3.4% during each of the prior five quarters. Picking up the slack was a 2.3% (0.1% y/y) advance in business fixed investment in equipment &amp; software, the firmest in three quarters, and a 22.2% (11.5% y/y) jump in business investment in structures. Also rising quickly were government purchases with a 4.3% (2.0% y/y) rise after a 0.5% 1Q decline.<img align="right" border="0" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727b.jpg"> 
An improved net export deficit added 1.6 percentage points to GDP growth. It occurred as exports boomed 6.4% (6.8% y/y) while imports fell 2.6% (+2.0% y/y).
Somewhat faster inventory accumulation added 0.2 percentage points to 2Q GDP after subtracting from GDP during the prior two quarters.
The GDP chain price index rose 2.7% versus expectations for a 3.4% rate of gain. Growth in the PCE chain price index rose to 4.3% (2.3% y/y) due to a 10.0% jump in nondurables boosted by higher fuel costs. Less food &amp; energy the PCE chain price index grew 1.4% (2.0% y/y), its slowest rate of increase since 2003.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@E7/@E701/@E701.HTM">Chained 2000$, % AR</a> </th>
<th scope="col">2Q 2007 </th>
<th scope="col">1Q 2007 </th>
<th scope="col">Y/Y </th>
<th scope="col">2006 </th>
<th scope="col">2005 </th>
<th scope="col">2004 </th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">GDP</td>
<td>3.4%</td>
<td>0.6%</td>
<td>1.8%</td>
<td>2.9%</td>
<td>3.1%</td>
<td>3.6%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Inventory Effect</td>
<td>0.2%</td>
<td>-0.7%</td>
<td>-0.7%</td>
<td>0.1%</td>
<td>-0.2%</td>
<td>0.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">Final Sales</td>
<td>2.2%</td>
<td>1.9%</td>
<td>3.5%</td>
<td>2.8%</td>
<td>3.3%</td>
<td>3.3%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Foreign Trade Effect</td>
<td>1.6%</td>
<td>-0.2%</td>
<td>0.8%</td>
<td>0.1%</td>
<td>0.0%</td>
<td>-0.5%</td>
</tr>
<tr class="odd">
<td class="firstcol">Domestic Final Demand</td>
<td>1.7%</td>
<td>1.6%</td>
<td>1.7%</td>
<td>2.7%</td>
<td>3.3%</td>
<td>3.8%</td>
</tr>
<tr>
<td class="firstcol">Chained GDP Price Index</td>
<td>2.7%</td>
<td>4.2%</td>
<td>2.7%</td>
<td>3.2%</td>
<td>3.2%</td>
<td>2.9%</td>
</tr>
</tbody>
</table>
Michigan Consumer Sentiment Up During July 
by <a href="/comment/Moeller.html">Tom Moeller</a> July 27, 2007


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727c.jpg" width="353">
The University of Michigan&#39;s reading of consumer sentiment this month rose 6.0% to 90.4, the highest level since February. The increase was less than the 8.3% gain reported in the preliminary report and it fell short of Consensus expectations for a reading of 91.5.
Consumer expectations contributed to the rise with a 9.1% jump m/m.
An improved expectation for business conditions during the next year contributed with an 11.7% m/m rise and an improved outlook for the next five years contributed with a 9.1% jump. Both these increases were much reduced from the preliminary report. <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727d.jpg" width="353">
An improved view of the current economic conditions contributed as it rose 2.6%. The view of current personal finances rose 4.5% (4.5% y/y) but the perspective of current buying conditions rose just 1.3% (-1.3% y/y).
The assessment of government policy improved 4.9% (4.9% y/y) after falling sharply during the prior two months.
The University of Michigan survey is not seasonally adjusted.The reading is based on telephone interviews with about 500 households at month-end.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@EF/@EF14/@EF1402/@EF1402.HTM">University of Michigan</a></th>
<th scope="col">July </th>
<th scope="col">July (Prelim.)</th>
<th scope="col">July y/y</th>
<th scope="col">June </th>
<th scope="col">2006</th>
<th scope="col">2005</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Consumer Sentiment</td>
<td>90.4</td>
<td>92.4</td>
<td>6.7% </td>
<td>85.3</td>
<td>87.3</td>
<td>88.6</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Current Conditions</td>
<td>104.5</td>
<td>105.7</td>
<td>1.0%</td>
<td>101.9</td>
<td>105.1</td>
<td>105.9</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Expectations</td>
<td>81.5</td>
<td>83.9</td>
<td>12.4%</td>
<td>74.7</td>
<td>75.9</td>
<td>77.4</td>
</tr>
</tbody>
</table>
Japan: CPI and Retail Sales Weaken--Discouragingly 
by <a href="/comment/Stone.html">Carol Stone</a> July 27, 2007


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727e.jpg" width="353">
It was looking promising in Japan: deflation was ending, finally, after almost 8 years. The most watched measure there, the core CPI excluding fresh food, had fallen from the middle of 1998 through April of 2006, according to the path of the year-over-year percent change. The overall amount of deflation wasn&#39;t all that bad: the index, seasonally adjusted, fell from a high of 103.4 in mid-1997 to a low of 99.9 in several months of 2005. But it was promising to see the index bottom out and begin to rise. The latter months of last year didn&#39;t see any big increase, but it really seemed that retailers were regaining some pricing power, necessary for the economy to sustain a self-reinforcing expansion.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727f.jpg" width="353">
But prices have not been able to sustain this new uptrend. This specific measure, the General CPI excluding fresh food has been down year-on-year since February, and today, the Ministry of Internal Affairs and Communications reported that June was a fifth consecutive month of decline, 0.1% from June 2006. This core index level is the blue line in the first graph.
The green line in that graph is a Western-style core index, the total less all food and energy. It highlights that the &quot;recovery&quot; we thought we saw in the other index was really concentrated in energy and that other prices continued down. The rate of decline eased in this index, but the year-on-year rate has never turned positive.
The June data show continuing weakness in housing, especially imputed rents, household furnishings, communications and reading &amp; recreation. Clothing and vehicle prices and public transportation charges have been edging marginally higher. Medical care and the &quot;miscellaneous&quot; category are up somewhat, the latter due mainly to an administered increase in tobacco prices.
With consumer prices unable to increase, it doesn&#39;t really seem surprising that retail sales have not risen either. The Ministry of Economy, Trade and Industry (METI) today reported a monthly decline of 0.8% for June, and a year-on-year reduction of 0.4%. Stores did have rising sales from 2003 through the middle of last year, a period when prices were falling. So price behavior isn&#39;t the only determinant. Individual store categories are showing mixed performances, with general merchandise outlets having persistent gains. But clothing stores saw notable drops in June, and motor vehicle dealers more than reversed a good April increase in May and June. Household appliance stores, facing a downtrend in home furnishings prices, have also been experiencing declining sales.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070727g.jpg" width="353">
At the beginning of this month, the fabled TANKAN survey indicated that businesses were more optimistic in Q2. While this is generally true, the assessments of retailers have diminished. For &quot;all enterprises&quot; in retailing, the &quot;actual conditions&quot; measure turned weaker in Q2 2006 and has continued to deteriorate since, along with both prices and sales. Sigh.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">JAPAN</th>
<th scope="col">June 2007*</th>
<th scope="col">May 2007*</th>
<th scope="col">Apr 2007*</th>
<th scope="col">Year/ Year</th>
<th scope="col">2006</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">CPI, General</td>
<td>-0.1</td>
<td>0.2</td>
<td>0.2</td>
<td>-0.2</td>
<td>0.2</td>
<td>-0.3</td>
<td>0.0</td>
</tr>
<tr>
<td class="firstcol">CPI ex Fresh Food</td>
<td>0.0</td>
<td>0.1</td>
<td>0.1</td>
<td>-0.1</td>
<td>0.1</td>
<td>-0.1</td>
<td>-0.1</td>
</tr>
<tr class="odd">
<td class="firstcol">CPI ex Food &amp; Energy</td>
<td>-0.1</td>
<td>-0.1</td>
<td>0.1</td>
<td>-0.4</td>
<td>-0.4</td>
<td>-0.4</td>
<td>-0.6</td>
</tr>
<tr>
<td class="firstcol">&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr class="odd">
<td class="firstcol">Retail Sales</td>
<td>-0.8</td>
<td>0.6</td>
<td>0.3</td>
<td>-0.4</td>
<td>0.1</td>
<td>1.0</td>
<td>1.0</td>
</tr>
</tbody>
</table>


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US 2Q 2007 GDP Above Expectations

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070726h.jpg" width="353">
Statistics Canada today reported monthly data on payroll employment for May, its establishment employment survey. The total number of employees increased 6,900, roughly in line with the experience over the previous months of 2007, which averaged 8,500.
An industrial breakdown shows firmer gains, though, in both goods-producing and services-producing sectors. Goods industries saw jobs increase 18,600 and services, 27,700. The difference between the sum of the individual sectors and the total comes in a group of &quot;unclassified enterprises&quot;. Reported employment in these firms dropped sharply in May, by 37,600 before seasonal adjustment. This is out of line with its prior behavior, and we wonder if it might be revised in a month&#39;s time or so.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070726i.jpg" width="353">
Meantime, there were constructive increases in the individual sectors. The goods industries had contracted in February, March and April by a total of more than 26,000. Most of this was in manufacturing, but jobs in forestry &amp; logging, mining and utilities also fell. May saw further and bigger declines in mining, but forestry turned sharply higher and manufacturing increased by 7,900, the strongest monthly performance since September 2004. Both durable and nondurable goods segments participated. Construction jobs have seen persistent and significant growth, running 5.5% over the last 12 months and 6.1% during 2006.
Among service industries, there was quite a mix. Finance and professional &amp; technical services showed good gains and transportation, retailing and accommodations &amp; food services were all relatively strong. Areas of modest growth or outright decline included real estate, business services and administrative support. Public administration and public service sectors such as health care and education were also on the slow side.<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070726j.jpg" width="353">
As with many kinds of economic data, Canada&#39;s payroll employment shows mixed behavior among the components and varying movement over time. The new DLXVG3, coming out soon, will assist in the assessment of such data. In the last chart here, we show the total series excluding the unclassified enterprises. To try to diminish some of the &quot;noise&quot; in the monthly changes, we can calculate some trends. We start by taking a 12-month moving average in the data and then we take the average monthly change over 12-month periods. This is seen in the last graph. It is evident that job growth is much steadier now than it was in the earlier history of this survey. From early 1997 to mid-2004, a period of 90 months, there were three distinct cycles of strength and weakness in industry jobs, lasting an average of 30 months or 2-1/2 years. In the 3 years since, there has been only a bit more than half a cycle, with the uptrend showing more gradual improvement than before, but obviously lasting much longer. Over the first 5 months of this year, industry employment growth appears to be slowing, but again more gradually than in the previous cycles. It will be interesting to see way the pattern evolves in coming months.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">CANADA, Thous.</th>
<th scope="col">May 2007*</th>
<th scope="col">Apr 2007*</th>
<th scope="col">Dec 2006*</th>
<th scope="col">Year Ago</th>
<th scope="col">2006</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Total Employees &nbsp;(incl Unclassified)</td>
<td>14,259</td>
<td>14,252</td>
<td>14,218</td>
<td>14,019</td>
<td>14,041</td>
<td>13,702</td>
<td>13,440</td>
</tr>
<tr>
<td class="firstcol">Average Monthly Changes</td>
<td>7</td>
<td>1</td>
<td>8 (Dec to May)</td>
<td>21</td>
<td>29</td>
<td>22</td>
<td>16</td>
</tr>
<tr>
<td class="firstcol">&nbsp; % Change</td>
<td>0.0%</td>
<td>0.0%</td>
<td>0.1%</td>
<td>1.7%</td>
<td>2.5%</td>
<td>2.0%</td>
<td>1.5%</td>
</tr>
<tr class="odd">
<td class="firstcol">Total ex Unclassified**</td>
<td>38</td>
<td>9</td>
<td>19</td>
<td>1.9%</td>
<td>2.6%</td>
<td>1.5%</td>
<td>0.9%</td>
</tr>
<tr>
<td class="firstcol">Goods Producing**</td>
<td>19</td>
<td>-12</td>
<td>0</td>
<td>-0.1%</td>
<td>1.4%</td>
<td>0.1%</td>
<td>0.0%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Construction**</td>
<td>12</td>
<td>3</td>
<td>4</td>
<td>5.5%</td>
<td>6.1%</td>
<td>4.7%</td>
<td>4.5%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Manufacturing**</td>
<td>8</td>
<td>-4</td>
<td>-3</td>
<td>-2.3%</td>
<td>-1.0%</td>
<td>-1.9%</td>
<td>-2.1%</td>
</tr>
<tr>
<td class="firstcol">Service Producing**</td>
<td>28</td>
<td>12</td>
<td>20</td>
<td>2.4%</td>
<td>2.9%</td>
<td>1.9%</td>
<td>1.2%</td>
</tr>
</tbody>
</table>
</body>
</html>

Statistics Canada today reported monthly data on payroll employment for May, its establishment employment survey. The total number of employees increased 6,900, roughly in line with the experience over the previous months of 2007, [...]

Industry Employment in Canada Shows Manufacturing Upturn in May, Somewhat Slower Growth in Services

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070726e.jpg" width="353">
New home sales during June fell 6.6% to 834,000 following a 2.2% drop in May. The decline was back down to the current cycle&#146;s low. 
June sales were down sharply in nearly every region:In the Northeast sales fell 27.1% and were unchanged y/y. In the Midwest sales dropped 17.1% (-28.4% y/y). Sales out West declined a huge 22.5% (-42.8% y/y) but in the South sales rose 7.6% (-12.9% y/y). <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070726f.jpg" width="353">
The inventory of unsold homes was unchanged for the month and actually fell 5.0% y/y.
The median new home price fell 1.3% (-2.2% y/y) for the month.
The Fed&#146;s latest Beige Book covering regional economic activity is available <a href="http://www.federalreserve.gov/fomc/beigebook/2007/20070725/default.htm">here</a>. 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">US New Homes</th>
<th scope="col">June</th>
<th scope="col">May</th>
<th scope="col">Y/Y</th>
<th scope="col">2006</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Total Sales (SAAR, 000s)</td>
<td>834</td>
<td>893</td>
<td>-22.3%</td>
<td>1,049</td>
<td>1,279</td>
<td>1,201</td>
</tr>
<tr>
<td class="firstcol">Median Price (NSA, $)</td>
<td>239,800</td>
<td>239,400</td>
<td>-2.1%</td>
<td>241,125</td>
<td>234,208</td>
<td>217,817</td>
</tr>
</tbody>
</table>
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New home sales during June fell 6.6% to 834,000 following a 2.2% drop in May. The decline was back down to the current cycles low. June sales were down sharply in nearly every region:In the Northeast sales fell 27.1% and were [...]

New Home Sales and Prices Fell

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070726c.jpg" width="353">
The 1.4% rise in new orders for durable goods during June missed Consensus expectations for a 1.6% increase. Though the shortfall was only slight, the gain failed to make up for a 2.3% decline during May and other details within the report were soft.
During the last ten years there has been a 67% correlation between the y/y change in durable goods orders and the change in production of durable goods.
Orders for nondefense capital goods did jump 4.6% last month, but again the increase failed to make up the prior month&#146;s 6.8% decline. And excluding aircraft &amp; parts orders fell 0.7%, the fourth decline this year and it pulled the y/y change to a negative 2.4%. During the last ten years there has been an 84% correlation between the y/y change in capital goods orders less aircraft and the y/y change in business fixed investment in equipment &amp; software from the GDP accounts.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/070726d.jpg" width="353">
Orders for computers &amp; electronic products fell 4.6% (-3.2% y/y) after a 5.0% gain during May. Orders for just computers &amp; related products fell 3.9% (-2.2% y/y). Primary metals orders dropped 3.6% (-3.3% y/y) after a 4.7% slide during May. And the 1.5% (2.8% y/y) increase in electrical equipment orders during June only recouped about half of the prior month&#146;s 3.8% slip.
Shipments of durable goods fell 1.1% (-0.8% y/y) after a modest 0.6% increase during May. Less the transportation sector shipments fell 1.1% (-0.2% y/y). During the last ten years there has been an 82% correlation between the y/y change in durable goods shipments and the change in industrial production of durable goods. The June decline reflected a 4.0% (-1.3% y/y) drop in shipments of computers &amp; electronic products but a firm 0.7% (15.9% y/y) rise in shipments of machinery.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@ED/@ED01/@ED0101/@ED0101.HTM">NAICS Classification</a></th>
<th scope="col">June </th>
<th scope="col">May</th>
<th scope="col">Y/Y</th>
<th scope="col">2006</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Durable Goods Orders</td>
<td>1.4%</td>
<td>-2.3%</td>
<td>-0.6%</td>
<td>6.3%</td>
<td>9.9%</td>
<td>5.3%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp; Excluding Transportation</td>
<td>-0.5%</td>
<td>-0.2%</td>
<td>-1.7%</td>
<td>7.6%</td>
<td>8.8%</td>
<td>7.9%</td>
</tr>
<tr class="odd">
<td class="firstcol">Nondefense Capital Goods</td>
<td>4.6%</td>
<td>-6.8%</td>
<td>6.5%</td>
<td>10.6%</td>
<td>17.1%</td>
<td>5.7%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Excluding Aircraft</td>
<td>-0.7%</td>
<td>-1.5%</td>
<td>-2.4%</td>
<td>8.5%</td>
<td>11.1%</td>
<td>3.2%</td>
</tr>
</tbody>
</table>
</body>
</html>

The 1.4% rise in new orders for durable goods during June missed Consensus expectations for a 1.6% increase. Though the shortfall was only slight, the gain failed to make up for a 2.3% decline during May and other details within the [...]

U.S. Durable Goods Orders Missed Forecasts

USD/EUR exchange rate uncoupling from interest rate differential

Widespread downgrading of 2025 GDP outlook

Trade and fiscal policy uncertainty has exploded with the new administration

Much lower US electricity costs gives it a competitive advantage

Wage growth slowing in the US and Euro area; elevated and sticky in the UK

Stagflation-lite: Blue Chip forecasts below-trend growth and elevated inflation

US policy gyrations boosting policy uncertainty worldwide

Expected tariff hikes have boosted inflation expectations

US and Japan ended 2024 on solid ground in contrast to Europe

US economy expected to outperform other major economies in 2025

Only modest evidence of AI-related surge in US productivity growth

Previous Trump tariffs fading. A boost from new tariffs ahead?

Heavy US manufacturing states underperforming while Sun Belt states outperforming

Rising long-term yields a global phenomenon

US financial market concerns shifting from growth to inflation

Economic activity is picking up in the US but remains lackluster abroad

Policy uncertainty has surged since the US national elections.

Recent turnaround in US economic surprises leading to increases in rate-cut expectations

The outlook has brightened in the US, while it has dimmed for other major economies

Headline US PCE inflation elevated by sticky services prices

US and global equity prices have recently diverged

US leading global upturn in economic surprises

Blue Chip forecasters look for further significant monetary easing apart from Japan

Recent rise in global supply chain pressures could augur a pickup in global inflation pressures

Underperforming German economy generating increased policy uncertainty relative to Europe and the US

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Real GDP eased 0.3% SAAR (+2.1% y/y) during the first quarter of 2025 after increasing 2.4% in Q4’24 and 3.1% in Q3’24. A 0.4% increase had been expected in the Action Economics Forecast Survey. It was the first decline since Q1 2022.

Foreign trade subtracted 4.83 percentage points from growth last quarter as imports surged 41.3% (13.4% y/y) ahead of tariffs, which began to come into effect in the first quarter. The rise followed a 1.9% decline in Q4’24. Exports rose 1.8% (3.0% y/y) after easing 0.2% in Q4. Inventories added 2.25 percentage points to growth after subtracting 0.84 percentage point from Q4 growth.

Real final sales to domestic purchasers grew 2.3% (2.9% y/y) in Q1 after rising 3.0% in Q4. Personal consumption expenditures rose 1.8% (3.1% y/y) following a 4.0% gain. Durable goods spending fell 3.4% (+5.3% y/y) after surging 12.4% in Q4. Motor vehicle purchases declined 11.1% (+5.5% y/y) after strengthening 19.7% in Q4. Spending on home furnishings & appliances gained 1.5% (6.1% y/y) following a 5.4% rise. Recreational goods & vehicle outlays rose 2.5% (7.0% y/y) last quarter after a 13.9% Q4 increase.

Nondurable goods outlays rose 2.7% (3.0% y/y) following 3.1% growth in Q4. Apparel spending increased 6.7% (2.5% y/y) following a 5.0% rise. Food & beverage buying gained 2.5% (2.3% y/y) after a 1.8% increase. Gasoline & fuel oil purchases increased 4.6% (3.4% y/y) after falling 2.0% in Q4.

Spending on services increased 2.4% last quarter (2.7% y/y) after a 3.0% gain. Outlays on housing & utilities increased 3.4% (1.8% y/y) after rising 1.1% in Q4. Health care expenditures rose 4.0% (4.8% y/y) following a 4.7% strengthening. Transportation outlays increased 5.3% (4.6% y/y) after a 3.7% rise while recreation spending rose 4.7% (2.8% y/y) following a 4.5% rise. Restaurant & hotel expenditures declined 2.1% (+0.5% y/y) following a 2.8% rise. Financial services expenditures rose 1.9% (2.0% y/y) after a 3.1% Q4 increase.

Business fixed investment increased 9.8% (3.6% y/y) following a 3.0% decline in Q4. Expenditures on structures rose 0.4% (-0.4% y/y) after a 2.9% increase. Expenditures on producers’ durable equipment jumped 22.5% (8.0% y/y) after falling 8.7%.  Outlays on information processing equipment soared 69.3% (18.9% y/y) following a 7.3% decline. Industrial equipment investment fell 1.4% (-0.3% y/y) after easing 0.9%. Intellectual property product spending rose 4.1% (1.8% y/y) following a 0.5% decline. 

Residential structures investment increased 1.3% (-0.1% y/y) in Q1 after a 5.5% Q4 rise.

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Government spending fell 1.5% (+2.4% y/y) after a 3.1% Q4 rise. Federal government expenditures declined 5.1% (+2.9% y/y) after rising 4.0% in Q4. National defense expenditures declined 8.0% (+4.0% y/y) after increasing 4.8% in Q4. State & local government spending rose 0.8% (2.1% y/y) following a 2.5% rise.

The GDP price index rose 3.7% (2.6% y/y) after increasing 2.3% in Q4. It was the largest increase since Q4’22. A 2.4% increase had been expected. The PCE chain price index increased 3.6% (2.5% y/y) following a 2.4% rise. The PCE price index excluding food and energy rose 3.5% (2.8% y/y) after increasing 2.6% in Q4. The business fixed investment price index rose 0.4% (1.8% y/y) after 1.5% rise. The residential price index strengthened 3.9% (3.2% y/y) after a 1.9% rise while the government price index increased 4.7% (2.8% y/y) following a 2.1% rise.

The GDP data can be found in Haver’s **USECON** and **USNA** databases. **USNA** contains virtually all of the Bureau of Economic Analysis detail in the national accounts. The Action Economics consensus estimates can be found in **AS1REPNA**.

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- Decline in GDP is first in three years.
- Foreign trade subtracts substantially ahead of tariffs.
- Domestic final demand growth weakens.
- Price index strengthens with higher core PCE prices.

U.S. GDP Unexpectedly Declines in Q1’25; Prices Strengthen

Michael J. Moran

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High-side readings on the price indexes for personal consumption expenditures in January and February caused some concern about emerging price pressure, especially with some policies of the Trump administration possibly adding to the upward force. However, March brought notable relief, with the headline price index falling slightly (-0.04%). A marked decline in energy prices was helpful (-2.7%), but core prices also were subdued, increasing less than 0.1%.  Year-over-year changes were still above the Fed’s target of 2%, but only barely so for the headline measure (2.3%). The core index backed away from the reading of 3.0% in February, but the latest reading of 2.7% was in line with observations in the past year, and still uncomfortably above target.

Consumers roused from a winter slumber in March, with nominal outlays increasing 0.7%. With inflation restrained, real outlays also posted a gain of 0.7%. Spending on durable gods stood out, with real outlays advancing 3.2%. Real outlays for both nondurable goods and services rose 0.4%, a solid pace. Signs of life were certainly welcome after an average decline of 0.1% in January and February. The March rebound left growth of 1.8% (annual rate) in the first quarter.

The brisk increase in spending in March was supported by a solid gain in personal income (0.5% in both nominal and real terms). Growth in wage income was firm at 0.5%, while proprietors’ income was robust with a gain of 1.8% (not annualized!). The farm sector led the advance in proprietors’ income, but the nonfarm sector also was strong (0.6%).

The personal income and consumption figures are available in Haver’s **USECON** database with detail in the **USNA** database. The Action Economics forecasts are in **AS1REPNA**.

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- Price pressure eases.
- Spending rebounds after two soft months.

Personal Income, Consumption, and Prices in March

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The Pending Home Sales Index, a forward-looking home sales measure based on contract signings, from the National Association of Realtors rose 6.1% to 76.5 (-0.6% y/y) during March after rising a little-revised 2.1% in February. These changes followed a 4.6% January decline.

The rise in March sales occurred as the rate on a 30-year mortgage eased to an average 6.65% from 6.84% in February. This rate was well above a low of 2.68% averaged in December 2020.

Pending home sales were up in most regions of the country. Sales in the Midwest rose 4.9% (1.4% y/y) last month after rising 1.8% in February. Sales in the South increased 9.8% (-0.4% y/y) following a 5.8% February rise. Sales in the West improved 4.8% (-2.0% y/y) after falling 3.0% in February. Sales in the Northeast were off 0.5% (-3.0% y/y) in March after falling 0.9% in February.

The pending home sales index measures sales at the time the contract for the purchase of an existing home is signed, similar to the Census Bureau's new home sales data. In contrast, the National Association of Realtors' existing home sales data are recorded when the sale is closed, which is usually a couple of months after the sales contract has been signed. In developing the pending home sales index, the NAR found that the level of monthly sales contract activity leads the level of closed existing home sales by about two months.

The series dates back to 2001 and are available in Haver's **PREALTOR** database. Weekly mortgage interest rates from the Mortgage Bankers Association can be found in the **WEEKLY** database.

- Sales rise to highest level in four months.
- Strength is evident throughout most of country.

U.S. Pending Home Sales Surge in March

Sandy Batten

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The employment cost index (ECI) for civilian workers, arguably the most accurate measure of labor compensation in the United States, rose 0.9% q/q (3.6% y/y) in Q1, the same quarterly increase as in last year’s Q4, according to the Bureau of Labor Statistics. The quarterly gains have fluctuated between 0.8% and 1.0% for the past six quarters. The Action Economics Forecast Survey had expected a 0.9% q/q increase and a 3.5% y/y gain.

Wages and salaries for civilian workers rose 0.8% q/q (3.5% y/y) in Q1, down from 1.0% q/q in Q4. This tied the Q3 2024 quarterly rise as the smallest increase since Q2 2021. It was also the smallest y/y increase since Q2 2021. Benefits increased by an outsized 1.2% q/q (3.9% y/y) in Q1 versus 0.8% q/q in Q4. This is the largest quarterly gain since Q2 2022. In general, employment cost gains remain above the pace observed prior to the pandemic but are slowing gradually.

Private industry workers’ compensation rose 0.8% q/q (3.4% y/y) in Q1, down from 0.9% q/q (3.6% y/y) in Q4. Wages and salaries for private industry workers increased 0.8% q/q (3.4% y/y) in Q1 versus 0.8% q/q (3.7% y/y) in Q4. The quarterly gain in Q1 tied that in Q3 2024 as the smallest increase since Q4 2020. Benefits for private industry workers jumped 1.2% q/q (3.6% y/y). the largest quarterly gain since Q2 2022. The acceleration in benefits in Q1 was primarily in service-producing industries.

Compensation in private goods-producing industries increased 1.0% q/q (3.2% y/y) in Q1, the largest quarterly gain in five quarters, versus a 0.7% q/q increase in Q4. Compensation in construction jumped 1.3% q/q, its largest quarterly increase since Q2 2022, up from a 0.6% q/q gain in Q4. Manufacturing compensation growth slowed to 0.7% q/q, its slowest quarterly advance since Q4 2020, from 0.8% q/q in Q4. Compensation in private service-producing industries increased 0.8% q/q (3.5% y/y), down slightly from a 0.9% q/q gain in Q4. Compensation in education and health services jumped 1.3% q/q, its largest quarterly gain since Q3 2023. In contrast, compensation in other services edged up 0.1% q/q in Q1, its smallest quarterly advance since before the pandemic.

The employment cost index measures the change in the cost of labor, free from the influence of employment shifts across occupations and industries. It is provided by the Bureau of Labor Statistics and is available in Haver’s **USECON** database. Consensus estimates from the Action Economics Forecast Survey are in Haver’s **AS1REPNA** database.

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- Compensation grew 0.9 q/q in Q1, the same pace as in Q4.
- Wage growth slowed to 0.8% q/q while benefits surged 1.2% q/q, their largest quarterly increase since Q2 2022.

Employment Cost Growth Steady in Q1 2025

Kathleen Stephansen, CBE

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The ADP National Employment Report indicated that nonfarm private sector payrolls rose 62,000 (1.4% y/y) during April after increasing 147,000 (1.4% y/y) during March, revised from 155,000. A 124,000 April rise in ADP employment had been expected in the Action Economics Forecast Survey.

Growth in median annual pay for "job stayers" eased to 4.5% y/y during April, from 4.6% y/y in March and from 4.7% y/y in the prior two months. Manufacturing sector pay grew 4.6% y/y during April, down from 4.8% y/y in March. Construction sector pay was unchanged at 4.7% y/y. Natural resource & mining sector pay grew 4.4% y/y. Financial sector pay rose 5.1% y/y, while education & health services pay rose 4.7% y/y. Leisure & hospitality pay also increased 4.7% y/y. Professional & business service sector pay increased 4.3% y/y as did trade, transportation & utilities pay. Information pay rose 4.1% y/y. Median annual pay for “job changers” rose 6.9% y/y after 6.7% y/y in March.

Small business hiring (less than 50 employees) rose 11,000 (0.6% y/y) after rising 18,000 (0.6% y/y) in March, revised down from 52,000. Employment at medium-sized firms (50-499,000 employees) rose 40,000 (1.1% y/y) after rising 43,000 (1.1% y/y). Large business hiring (500+ employees) rose 12,000 (3.4% y/y) in April, after rising 61,000 (3.6% y/y) in March, revised from 59,000.

Goods-producing employment rose 26,000 (1.3% y/y) in April, after rising 16,000 (1.3% y/y) during March, revised from 24,000. Manufacturing jobs rose 4,000 (-0.2% y/y) after rising 17,000 (-0.3% y/y) in March. The number of construction sector jobs rose 16,000 (3.4% y/y) in April, following a 2,000 (3.6% y/y) March increase, revised from 6,000. Natural resources & mining jobs rose 6,000 (2.8% y/y) in April after falling 3,000 (+1.9% y/y) in March.

The number of service-producing jobs rose 34,000 (1.4% y/y) during April, following a rise of 131,000 (1.4% y/y) in March. Professional & business services employment fell 2,000 (0.6% y/y) after rising 46,000 (0.7% y/y) in the prior month, revised from 57,000. Employment in the financial industry rose 20,000 (2.1% y/y) in April, after rising 38,000 (2.0% y/y) in March. Leisure and hospitality employment increased 27,000 (3.0% y/y), following a 23,000 (2.9% y/y) March increase, revised from 17,000. The number of education & health care jobs fell 23,000 (1.6% y/y) in April, following a 15,000 (1.8% y/y) rise in March, revised from 12,000. Information sector employment fell 8,000 (-0.1% y/y) after a rise of 3,000 (0.2% y/y) in March. The number of jobs in trade, transportation & utilities rose 21,000 (0.4% y/y) in April, after falling 4,000 (+0.4% y/y) in March, revised from a 6,000 fall. Employment in “other” services rose fell 1,000 (+3.2% y/y) following a 10,000 (3.4% y/y) rise in March, revised from 11,000.

By region, employment in the Northeast increased 10,000 (1.9% y/y) in April, following an increase of 95,000 (2.0% y/y) in March, revised from 89,000. Employment in the Midwest rose 42,000 (1.5% y/y) after a gain of 84,000 (1.4% y/y) in March, revised from 81,000. In the South, employment rose 3,000 (1.3% y/y) during April, after rising 10,000 (1.4% y/y) in March, revised from 27,000. In the West, employment rose 9,000 (0.6% y/y) after declining 43,000 (+0.6% y/y), revised from a 41,000 decline in March.

The ADP National Employment Report and Pay Insights data can be found in Haver's **USECON** database. Historical figures date back to January 2010 for private employment. Pay data date back to October 2020. The expectation figure is available in Haver's **AS1REPNA** database.

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- Employment increase is modest in both services & factory sectors.
- Wage growth for “job stayers” moderates.
- Small and medium-sized business employment slows.

Economy in Brief: July 2007

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Japan: CPI and Retail Sales Weaken--Discouragingly

Michigan Consumer Sentiment Up During July

US 2Q07 GDP Above Expectations

US 2Q 2007 GDP Above Expectations

Industry Employment in Canada Shows Manufacturing Upturn in May, Somewhat Slower Growth in Services

New Home Sales and Prices Fell

U.S. Durable Goods Orders Missed Forecasts

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