Tom Moeller

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071015a.jpg" width="353">
For Fiscal Year 2007, the U.S. government&#39;s budget deficit narrowed sharply to 162.8B versus a deficit during FY 2006 of 248.2B. For the third consecutive year, the deficit&#39;s narrowing occurred as revenue growth surged ahead of outlays.
As a percentage of GDP the budget deficit last year totaled roughly 1.5%, down sharply from 3.6% in 2004. Receipts rose sharply to 18.8% of GDP, about equal to the long term average.
For forecasts of the deficit in coming fiscal years, the administration&#39;s latest Midsession Review of the Budget can be found <a href="http://www.whitehouse.gov/omb/budget/fy2008/pdf/08msr.pdf"> here</a>.
The Government&#39;s financial data is available in Haver&#39;s USECON database. <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071015b.jpg" width="353">
Net revenues last fiscal year grew 6.7% y/y, quite a slowdown from 11.8% growth during FY06. Growth in individual income tax receipts (44% of total receipts), however, held firm at 11.5%. Withheld taxes grew 9.4% during FY07 but non-withheld taxes rose a much stronger 13.0% due to estimated capital gains. Corporate income taxes (13% of total receipts) lagged and rose just 4.6% while a slowdown in employment growth raised employment contributions by just 4.3% versus a 5.7% gain during FY06 and 8.5% during FY05.
U.S. net outlays grew just 2.8% during last fiscal year, a slowdown from 7.4% during FY06. Defense spending (19% of total outlays) picked up a bit and rose 6.1%. Medicare expenditures (12% of outlays) again surged by 13.8% after a 10.5% jump during FY06. Social security spending (21% of outlays) picked up slightly to 6.9% but growth in the government&#39;s interest expense declined to rose by 5.0% y/y.

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<colgroup><col><col><col><col><col><col></colgroup>
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<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@E1/@E106/@E10602/@E106021.HTM">US Government Finance</a> &nbsp;</th>
<th scope="col">September</th>
<th scope="col">July</th>
<th scope="col">Y/Y</th>
<th scope="col">FY 2007</th>
<th scope="col">FY 2006</th>
<th scope="col">FY 2005 &nbsp;</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Budget Balance</td>
<td>$111.6B</td>
<td>$-117.0B</td>
<td>$56.2B (9/06)</td>
<td>-$162.8B</td>
<td>-$248.2B</td>
<td>-$318.7B</td>
</tr>
<tr>
<td class="firstcol">Net Revenues</td>
<td>$285.4B</td>
<td>$166.5B</td>
<td>0.7%</td>
<td>6.7%</td>
<td>11.8%</td>
<td>14.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">Net Outlays</td>
<td>$173.8B</td>
<td>$283.5B</td>
<td>-23.5%</td>
<td>2.8%</td>
<td>7.4%</td>
<td>7.6%</td>
</tr>
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For Fiscal Year 2007, the U.S. government's budget deficit narrowed sharply to 162.8B versus a deficit during FY 2006 of 248.2B. For the third consecutive year, the deficit's narrowing occurred as revenue growth surged ahead of [...]

U.S. Budget Deficit Narrowed Sharply

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/071012j.jpg" width="353">
The awarding of the Nobel Peace Prize to Al Gore and the United Nations Intergovernmental Panel on Climate Change brings environmental issues to specific public attention once again. The news prompted us to browse Haver&#39;s offerings for information on climate and energy. We are a bit surprised, though we shouldn&#39;t be, to see how many different databases contain relevant data. Here are some select items.
An obvious place to begin is OGJ, the Oil &amp; Gas Journal database of its own and Department of Energy series. One section of this we haven&#39;t looked at much is &quot;Other Energy&quot;. It includes the intriguing item &quot;Renewable Energy Production and Consumption&quot;. The data, available through June, show that these sources constitute about 9.5% of total energy production in the US. Hydroelectric power and &quot;wood, waste and alcohol&quot; are most of this, at about 4-1/4% each. Other, more esoteric types are small but expanding rapidly: each geothermal and wind and solar have recently been about 0.3% of total energy production. This is a tiny fraction, but it has increased by about 75% over the past five years, with most of the advance in wind and solar.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012k.jpg" width="353">
Another fact evident in the first graph here is that total energy consumption in the US has been about flat in recent periods. These data are not seasonally adjusted, but we can get around that to make our analysis more intelligible. We can aggregate the monthly energy consumption data to quarterly totals using the &quot;A&quot; function in the Haver DLXVG3 software and then take a 4-quarter moving total. The numerical result here is a convenient figure, right at 100 quadrillion BTU. The peak was 100.683 quads in Q3 2005; after a dip in 2006, Q2 this year was 100.637 quads. But GDP has grown over this period; in Q2 2007 its 4-quarter moving average (a figure comparable to our BTU calculation) was 4.5% higher than in Q3 2005. So the energy productivity of the economy has increased noticeably over this span: almost the same amount of energy yielded more economic activity.
We&#39;re hearing a lot about biofuels [a word, by the way, that I just added to the Microsoft Office spell-check dictionary!], and one thing we can say is that they have contributed to higher prices for grain. In the DAILY database, we find spot and futures prices for corn, and we can see plainly how they have lurched higher from about this time last year. However, the price of ethanol is yet to establish a smooth trading pattern. The futures market for it began on the Chicago Board of Trade on March 23, 2005, with the nearby (1st expiring) contract closing at $1.22/gallon. It shot up by mid-2006 to $4.23 and today closed at $1.575. Clearly, underlying supply and demand for ethanol have not gone up by three-and-a-half times and back down by two-thirds. So traders, both hedgers and speculators, have yet to find their footing in the rapidly changing economic, financial and scientific environment. <img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012l.jpg" width="353">
Finally, what about climate. After all, that is what concerns Mr. Gore the most. What can Haver&#39;s data tell us? We have average temperature and precipitation data, monthly back to 1921, in USECON for the &quot;Lower 48&quot; and in REGIONAL for individual regions and states. A quick way to see trends here is a moving average that&#39;s in a multiple of 12 months; 5 years seems easy. Looks that there&#39;s been some very slight tendency for wetter weather in the latter years and also the warming trend we hear so much about. Obviously these data just cover the US, so we can&#39;t speak here to the global situation, but the move in this country over the past 25 years seems more distinctive than might be attributable to mere chance. Being proper econometricians -- or at least cautious ones -- we&#39;ll be sure to say we haven&#39;t tested that proposition. And it would quite clearly need testing. Moreover, this only says the trend is up. It does not examine why that might be the case.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012m.jpg" width="353">
These paragraphs only scratch the surface of the information in Haver&#39;s data collections that covers environmental questions. Previous commentary here has covered miles driven and compared that to GDP growth, a result we called &quot;driving productivity&quot;. We have seasonally adjusted some of the weekly EIA data and those are in WEEKLY. And of course, there are the highly useful Energy Intelligence databases on world oil supply and demand and natural gas weekly and monthly data. There are electric power prices in several databases. So we can help you assess numerous questions on energy, alternative energy and uses of energy and the ramifications of developments for economic growth and inflation. And you can bet our database managers will be adding more all the time. Indeed, let us know what&#39;s most important for you.


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The awarding of the Nobel Peace Prize to Al Gore and the United Nations Intergovernmental Panel on Climate Change brings environmental issues to specific public attention once again. The news prompted us to browse Haver's offerings [...]

Mr. Gore's Nobel Prize Occasions a Look at Haver's Energy & Environment Data

Robert Brusca

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012i.jpg" width="353">
The graph on the left paints a clear picture of French inflation turning higher in September 2007.And year/year inflation did just that. Yet inflation in France is not really accelerating. The year/year jump is due to an adverse base effect - the fact that a year ago inflation had fallen making this month&#146;s year/year a tougher comparison. When we instead look at 3-month inflation compared to 6-month inflation we see that the rate of inflation is back down from 2.7% to 1.8%.. Diffusion calculations also confirm that inflation remains under wraps. Diffusion calculates the percentage of main sectors in which inflation has accelerated in a period. What we find is that for the 3-month to 6-month inflation comparisons diffusion is 27.3 which is below the neutral level of 50. Indeed at this level we can see that inflation is in fact decelerating in many more sectors than it is accelerating. Inflation in France seems under control despite the unfortunate accompanying chart.It is more unfortunate that the chart is the main way that inflation watchers view inflation.
The table below shows the diversity in French inflation trends with one main thing in common: that inflation is mostly decelerating at least from 6 months to 3 months.Year-over-year, most sectors confirm that inflation IS higher although the headline is barely higher at 1.6% compared to 1.5% a year ago. 

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<th scope="col" colspan=8"France HICP and CPI details</th>
</tr>
</thead>
<tbody>
<tr class="even">
<td class="firstcol">&nbsp;</td>
<td colspan="3">Mo/Mo %</td>
<td colspan="3">Saar %</td>
<td>Yr/Yr</td>
</tr>
<tr class="grey2">
<td class="firstcol">&nbsp;</td>
<td>Sep-07</td>
<td>Aug-07</td>
<td>Jul-07</td>
<td>3-Mo</td>
<td>6-Mo</td>
<td>12-Mo</td>
<td>Yr Ago</td>
</tr>
<tr class="odd">
<td class="firstcol">HICP Total</td>
<td>0.1%</td>
<td>0.3%</td>
<td>0.0%</td>
<td>1.8%</td>
<td>2.7%</td>
<td>1.6%</td>
<td>1.5%</td>
</tr>
<tr class="odd">
<td class="firstcol">Core</td>
<td>#N/A</td>
<td>0.3%</td>
<td>0.0%</td>
<td>#N/A</td>
<td>#N/A</td>
<td>#N/A</td>
<td>1.2%</td>
</tr>
<tr class="grey2">
<td colspan=8 class="firstcol">CPI</td>
</tr>
<tr class="odd">
<td class="firstcol">All</td>
<td>0.0%</td>
<td>0.3%</td>
<td>0.1%</td>
<td>1.6%</td>
<td style="color:red;">2.4%</td>
<td>1.5%</td>
<td>1.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">CPI ex F&amp;E</td>
<td>0.1%</td>
<td>0.4%</td>
<td>0.1%</td>
<td style="color:red;">2.2%</td>
<td style="color:red;">2.2%</td>
<td>1.5%</td>
<td>1.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">Food</td>
<td>0.6%</td>
<td>0.7%</td>
<td>-0.2%</td>
<td>4.8%</td>
<td style="color:red;">5.0%</td>
<td>1.3%</td>
<td>2.7%</td>
</tr>
<tr class="odd">
<td class="firstcol">Alcohol</td>
<td>0.7%</td>
<td>2.9%</td>
<td>0.3%</td>
<td style="color:red;"> 16.5%</td>
<td style="color:red;">10.2%</td>
<td style="color:red;">3.9%</td>
<td>0.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">Clothing &amp; Shoes</td>
<td>0.4%</td>
<td>0.3%</td>
<td>-0.7%</td>
<td>-0.2%</td>
<td>0.3%</td>
<td style="color:red;">0.9%</td>
<td>0.2%</td>
</tr>
<tr class="odd">
<td class="firstcol">Rent &amp; Utilities</td>
<td>0.3%</td>
<td>0.1%</td>
<td>0.2%</td>
<td>2.5%</td>
<td style="color:red;">3.5%</td>
<td>2.7%</td>
<td>3.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">Health Care</td>
<td>0.1%</td>
<td>0.1%</td>
<td>0.4%</td>
<td style="color:red;">2.5%</td>
<td style="color:red;">0.7%</td>
<td style="color:red;">0.3%</td>
<td>0.2%</td>
</tr>
<tr class="odd">
<td class="firstcol">Transport</td>
<td>0.1%</td>
<td>-0.4%</td>
<td>0.2%</td>
<td>-0.5%</td>
<td style="color:red;">3.0%</td>
<td style="color:red;">2.4%</td>
<td>0.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Communication</td>
<td>0.2%</td>
<td>0.5%</td>
<td>0.0%</td>
<td style="color:red;">2.8%</td>
<td style="color:red;">0.7%</td>
<td style="color:red;">0.2%</td>
<td>-6.2%</td>
</tr>
<tr class="odd">
<td class="firstcol">Recreation &amp; Culture</td>
<td>-0.7%</td>
<td>-0.1%</td>
<td>-0.2%</td>
<td>-3.8%</td>
<td>-1.8%</td>
<td style="color:red;">-1.5%</td>
<td>-1.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Education</td>
<td>-0.1%</td>
<td>0.1%</td>
<td>0.2%</td>
<td>0.9%</td>
<td>1.7%</td>
<td>2.1%</td>
<td>2.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Restaurant &amp; Hotel</td>
<td>-1.0%</td>
<td>0.8%</td>
<td>0.5%</td>
<td>1.3%</td>
<td>2.3%</td>
<td style="color:red;">2.8%</td>
<td>2.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">Other</td>
<td>0.2%</td>
<td>0.1%</td>
<td>0.0%</td>
<td>1.3%</td>
<td style="color:red;">2.0%</td>
<td>1.9%</td>
<td>3.2%</td>
</tr>
<tr class="odd">
<td class="firstcol">Diffusion</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>27.3%</td>
<td>63.6%</td>
<td>63.6%</td>
<td>&nbsp;</td>
</tr>
<tr class="grey2">
<td class="firstcol">Type:</td>
<td colspan="3">Diffusion Compared to</td>
<td>6-mo</td>
<td>12-mo</td>
<td>Yr-Ago</td>
<td>&nbsp;</td>
</tr>
</tbody>
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The graph on the left paints a clear picture of French inflation turning higher in September 2007.And year/year inflation did just that. Yet inflation in France is not really accelerating. The year/year jump is due to an adverse base [...]

French Inflation Turns Higher But Not Really...

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<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012h.jpg" align="left" border="0" height="265" width="353">
The year/year ex-construction PPI continues to head lower, while the
six-month measure has seen some steady pressure and recent
quasi-plateauing. But the three- month PPI is heading strongly lower.
On balance, the Euro Area PPI seems to be well-behaved.
The trends are well-behaved across components as well. Only consumer
goods prices at the producer level are showing any acceleration in the
recent three months among major categories. Capital good prices are
decelerating as are intermediate and energy goods. Manufacturing as a
whole shows prices decelerating and the PPI ex-energy is also
decelerating. The EMU PPI is well contained.
At the country level, Germany and Italy show the same sort of
compliant patterns in their respective PPIs. The EU&#8217;s UK demonstrates
some flare up in the overall PPI but still shows a PPI ex energy with
decelerating trends. These are encouraging trends but this is not the
ECB&#8217;s prime inflation measure. That one, the HICP, has been showing
some pressure lately. But the lack of pressure at the PPI level is
still good news &#8211; at least through August.

<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead>
<tr>
<th colspan=7 scope="col">Euro Area and UK PPI Trends</th>
</tr>
</thead>
<tbody>
<tr class="even">
<td class="firstcol">&nbsp;</td>
<td colspan="2">M/M</td>
<td colspan="4">Saar</td>
</tr>
<tr class="grey2">
<td class="firstcol">Euro Area13</td>
<td>Aug-07</td>
<td>Jul-07</td>
<td>3-Mo</td>
<td>6-MO</td>
<td>Yr/Yr</td>
<td>Y/Y Yr Ago</td>
</tr>
<tr>
<td class="firstcol">Total ex Construction</td>
<td>0.1%</td>
<td>0.3%</td>
<td>1.7%</td>
<td style="color: red;">3.2%</td>
<td>1.7%</td>
<td>5.7%</td>
</tr>
<tr class="odd">
<td class="firstcol">Excl Energy</td>
<td>0.2%</td>
<td>0.2%</td>
<td>2.5%</td>
<td style="color: red;">3.2%</td>
<td>2.9%</td>
<td>3.6%</td>
</tr>
<tr>
<td class="firstcol">Capital Goods</td>
<td>0.0%</td>
<td>0.1%</td>
<td>0.6%</td>
<td>0.9%</td>
<td style="color: red;">1.6%</td>
<td>1.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Consumer Goods</td>
<td>0.5%</td>
<td>0.4%</td>
<td style="color: red;">4.4%</td>
<td style="color: red;">3.3%</td>
<td style="color: red;">2.3%</td>
<td>1.9%</td>
</tr>
<tr>
<td class="firstcol">Intermediate &amp; Capital Goods</td>
<td>0.1%</td>
<td>0.1%</td>
<td>1.3%</td>
<td>3.0%</td>
<td>3.3%</td>
<td>4.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Energy</td>
<td>-0.7%</td>
<td>0.4%</td>
<td>-1.2%</td>
<td style="color: red;">3.3%</td>
<td>-2.2%</td>
<td>12.6%</td>
</tr>
<tr>
<td class="firstcol">MFG</td>
<td>0.1%</td>
<td>0.3%</td>
<td>2.4%</td>
<td style="color: red;">4.8%</td>
<td>2.2%</td>
<td>4.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">Germany</td>
<td>0.1%</td>
<td>-0.1%</td>
<td>0.7%</td>
<td style="color: red;">1.7%</td>
<td>1.0%</td>
<td>5.9%</td>
</tr>
<tr>
<td class="firstcol">ex Energy</td>
<td>0.3%</td>
<td>0.1%</td>
<td>2.2%</td>
<td style="color: red;">2.8%</td>
<td>2.6%</td>
<td>3.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">Italy</td>
<td>0.1%</td>
<td>0.3%</td>
<td>2.0%</td>
<td style="color: red;">3.7%</td>
<td>1.9%</td>
<td>6.6%</td>
</tr>
<tr>
<td class="firstcol">ex Energy</td>
<td>0.3%</td>
<td>0.2%</td>
<td>2.1%</td>
<td style="color: red;">3.2%</td>
<td>3.1%</td>
<td>4.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">UK</td>
<td>-0.6%</td>
<td>0.7%</td>
<td style="color: red;">2.6%</td>
<td>-2.3%</td>
<td>-0.1%</td>
<td>8.4%</td>
</tr>
<tr>
<td class="firstcol">UK ex Energy</td>
<td>0.2%</td>
<td>0.4%</td>
<td>2.5%</td>
<td>2.7%</td>
<td style="color: red;">3.0%</td>
<td>3.0%</td>
</tr>
<tr class="grey1">
<td colspan="7" class="firstcol">Euro Area 13 Harmonized PPI excluding Construction</td>

</tr>
<tr class="grey1">
<td colspan="7" class="firstcol">The EA 13 countries are Austria, Belgium, Finland,
France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands,
Portugal, Slovenia and Spain.</td>

</tr>

</tbody>
</table>
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The year/year ex-construction PPI continues to head lower, while the six-month measure has seen some steady pressure and recent quasi-plateauing. But the three- month PPI is heading strongly lower. On balance, the Euro Area PPI seems [...]

Euro Area PPI Behaves in August

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012g.jpg" width="353">
The University of Michigan&#39;s preliminary reading of consumer sentiment in early October fell 1.7% to 82.0 after no change in September and a huge 7.7% drop in August. The decline exceeded Consensus expectations for a reading of 84.0.
Lower consumer expectations accounted for all of the fall. The decline offset a slight improvement in September.
Long term, expectations about personal finances and business conditions during the next year fell for the sixth month this year out of ten. Expectations about business conditions rose slightly but hardly offset huge declines in the prior two months.
The view of the current economic conditions improved due to a slight increase in the view of current personal finances. The perspective of current buying conditions also improved slightly.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012f.jpg" width="353">
The assessment of government policy in October recovered the declines 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">October (Prelim.)</th>
<th scope="col">September</th>
<th scope="col">October&nbsp; 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">Consumer Sentiment</td>
<td>82.0</td>
<td>83.4</td>
<td>-12.4% </td>
<td>87.3</td>
<td>88.5</td>
<td>95.2</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Current Conditions</td>
<td>98.2</td>
<td>97.9</td>
<td>-8.5%</td>
<td>105.1</td>
<td>105.9</td>
<td>105.6</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Expectations</td>
<td>71.6</td>
<td>74.1</td>
<td>-15.6%</td>
<td>75.9</td>
<td>77.4</td>
<td>88.5</td>
</tr>
</tbody>
</table>
</body>
</html>

The University of Michigan's preliminary reading of consumer sentiment in early October fell 1.7% to 82.0 after no change in September and a huge 7.7% drop in August. The decline exceeded Consensus expectations for a reading of 84.0. [...]

Michigan Consumer Sentiment Down

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012d.jpg" width="353">
U.S. September retail sales rise of 0.6% beat forecasts for a 0.2% uptick. The prior month&#39;s 0.3% gain was unrevised.
A 1.2% advance in motor vehicle purchases added to a 3.3% August rise.
Excluding autos, sales rose 0.4% and offset a 0.4% decline in August. A 0.3% gain had been expected.
Nonauto retail sales less gasoline rose just 0.2% (4.5% y/y) after an unrevised 0.1% decline during August. The movement followed a 0.8% July rise but no change in June.
Gasoline service station sales surged 2.0% but gas prices at the pump rose just 0.6% to an average $2.80 per gallon (9.7% y/y).<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012e.jpg" width="353">
Sales of discretionary items were generally weak last month. Furniture, home furnishings &amp; appliance stores rose just 0.1% (1.7% y/y) after a 0.4% August rise. Sales at general merchandise stores fell 0.1% (+3.7 y/y) and that gain is down from 5%+ increases this Summer. Apparel store sales fell 0.4% (+2.4% y/y), the third monthly decline in the last four
Building material sales recovered 0.8% (-0.6% y/y), perhaps reflecting the warm September weather.
Sales of nonstore retailers (internet &amp; catalogue) surged 1.1%% (8.7% y/y) and recovered from a 0.9% drop the prior month.
A Taylor Rule and the Greenspan Era from the Federal Reserve Bank of Richmond can be found <a href="http://www.richmondfed.org/publications/economic_research/economic_quarterly/pdfs/summer2007/mehra_minton.pdf"> here</a>. 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">&nbsp;</th>
<th scope="col">September</th>
<th scope="col">August</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"><a href="http://www.haverselect.com/dlx/usecon/@ED/@ED04/@ED0401/@ED0401.HTM">Retail Sales &amp; Food Services</a></td>
<td>0.6%</td>
<td>0.3%</td>
<td>5.0%</td>
<td>6.2%</td>
<td>6.6%</td>
<td>6.1%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Excluding Autos</td>
<td>0.4%</td>
<td>-0.4%</td>
<td>3.9%</td>
<td>7.3%</td>
<td>7.6%</td>
<td>7.1%</td>
</tr>
</tbody>
</table>


</html>

U.S. September retail sales rise of 0.6% beat forecasts for a 0.2% uptick. The prior month's 0.3% gain was unrevised. A 1.2% advance in motor vehicle purchases added to a 3.3% August rise. Excluding autos, sales rose 0.4% and offset a [...]

U.S. Retail Sales Beat Forecasts, But Nonauto Sales Weak

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012a.jpg" width="353">
Finished producer prices rose 1.1% last month and recouped virtually all of the 1.4% decline during August. The increase, led by higher food &amp; energy prices, topped consensus expectations for a 0.4% rise.
Energy prices were strongest and surged 4.1% after the prior month&#39;s 6.6% drop. Gasoline prices jumped 8.4% (21.6% y/y) after a 13.8% August drop and natural gas prices rose 3.2% (1.5% y/y).Home heating oil prices increased 2.0% (8.9% y/y.
Food prices jumped 1.5% (5.8% y/y) after four consecutive months of decline. Much higher prices for beef, eggs and fresh fruit led the advance last month.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012c.jpg" width="353">
The core finished goods PPI increased a modest 0.1% which was half the expected 0.2% rise. The three month change of 0.4% was its lowest since May. 
A 0.5% increase in household furniture prices was offset by a 1.8% decline in passenger cars.
Capital equipment prices also fell 0.1% after two months of 0.1% increases. Prices for light motor trucks fell 0.5% and civilian aircraft prices rose just 0.3%.
Intermediate goods prices made up a piece of the prior month&#39;s 1.2% decline with a 0.4% increase. The index excluding food &amp; energy prices rose a small 0.1% as prices for steel mill products fell another 1.2%. <img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/071012b.jpg" width="353"> 
The crude materials PPI rose just 0.1%, the weakness due to a 2.0% decline in energy led by lower natural gas prices. The core crude materials PPI jumped 1.6% after a 1.3% August increase. Iron &amp; steel scrap prices surged 5.8%. 
John Taylor&#39;s Contributions to Monetary Theory and Policy are today&#39;s remarks by Fed Chairman Ben S. Bernanke and they are available <a href="http://www.federalreserve.gov/newsevents/speech/bernanke20071012a.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"><a href="http://www.haverselect.com/dlx/USECON/@E8/@E802/@E80201/@E80201.HTM">Producer Price Index</a></th>
<th scope="col">September</th>
<th scope="col">August</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">Finished Goods</td>
<td>1.1%</td>
<td>-1.4%&nbsp;</td>
<td>&nbsp; 4.4%&nbsp;</td>
<td>2.9%</td>
<td>&nbsp;4.9%&nbsp;</td>
<td>3.6%&nbsp;</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Core</td>
<td>0.1%</td>
<td>0.2%</td>
<td>&nbsp;2.0%</td>
<td>1.4%</td>
<td>2.4%</td>
<td>1.5%</td>
</tr>
<tr class="odd">
<td class="firstcol">Intermediate Goods</td>
<td>0.4%</td>
<td>-1.2%</td>
<td>4.0%</td>
<td>6.4%</td>
<td>&nbsp;8.0%</td>
<td>6.6%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Core</td>
<td>0.1%</td>
<td>-0.5%</td>
<td>1.7%</td>
<td>6.0%</td>
<td>&nbsp;5.5%</td>
<td>5.7%</td>
</tr>
<tr class="odd">
<td class="firstcol">Crude Goods</td>
<td>0.1%</td>
<td>&nbsp;-3.0%&nbsp;</td>
<td>&nbsp;11.4%</td>
<td>1.4%</td>
<td>14.6%</td>
<td>&nbsp;17.5%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Core</td>
<td>1.6%</td>
<td>1.3%</td>
<td>&nbsp;14.0%</td>
<td>20.9%</td>
<td>4.9%</td>
<td>&nbsp;26.5%</td>
</tr>
</tbody>
</table>


</html>

Finished producer prices rose 1.1% last month and recouped virtually all of the 1.4% decline during August. The increase, led by higher food & energy prices, topped consensus expectations for a 0.4% rise. Energy prices were strongest [...]

U.S. PPI Strong, Core Weak

Job openings less than the number unemployed in July for first time since 2021

Reaccelerating goods price inflation along with sticky services inflation clouds the outlook

Falling oil prices aren't pulling down inflation expectations, pointing to a boost from increased tariffs

Equity market exuberance outpacing macroeconomic data

Apart from Japan, Blue Chip forecasters expect further sizable monetary easing

US production rebounded in Q2, but demand continued to slow

US leader, Germany trailer for real GDP growth over past 3 years

Negative US inflation surprises leading G10 down

Deflation continues in China

Incoming data surprising on downside in US; positive surprises elsewhere

FOMC expects more inflation and less growth than in March

With escalation of Israel/Iran conflict, geopolitical risk has recently surged while US trade policy uncertainty has ebbed

Renewed supply chain pressures point to a rebound in global inflation ahead

Apart from Japan, Blue Chip forecasters look for further significant monetary policy easing

Apart from the US, productivity is moribund

Financial market concerns ebb even though policy uncertainty continues to soar

US tariff revenues nearly doubled in April

Even with expected tariff-induced increases in inflation, BCFF forecasters look for a more aggressive round of monetary easing

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

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Nonfarm payrolls increased 22,000 during August after rising 79,000 in July, revised from 73,000 and falling 13,000 during June, revised from a 14,000 increase. Expectations had been for an 83,000 rise in the Action Economics Forecast Survey. The three-month average change in payrolls of 29,300 compared to 28,300 in July, but stood far below its high of 231,700 in January.

Average hourly earnings rose an expected 0.3% in August after unrevised gains of 0.3% in July and 0.2% in June. Earnings growth of 3.7% y/y equals that in June which is the lowest since July 2024, but has been trending lower from its 5.9% high in March 2022.

The unemployment rate, measured in the household survey, edged up m/m to an expected 4.3% from 4.2% in July and 4.1% in June. It reached a low of 3.4% in April 2023. The unemployment rate, including employees working part-time for economic reasons plus all marginally-attached workers, rose to 8.1% last month from 7.9% In July. It was 6.6% in April 2023.

In the **establishment survey**, private-sector employment in August rose 38,000 after rising 77,000 in July.  Factory sector jobs declined 12,000, off for the fourth straight month. Durable goods employment fell 19,000 after rising 5,000, as motor vehicle & parts hiring declined 7,300 after a 2,000 July gain. Nondurables employment rose 7,000, reversing a 7,000 July decline. Construction sector employment weakened 7,000, down for the third straight month. The number of mining & logging industry jobs declined 6,000, also registering the fourth consecutive month of decline.

Private service-sector employment increased 63,000 during August after improving 85,000 in July. Increases varied greatly amongst service-sector categories. Private education & health sector employment rose 46,000 last month, following a 77,000 increase in July. The number of leisure & hospitality jobs rose 28,000 after a 6,000 gain. Trade, transportation & utilities employment gained 2,000, following a 5,000 increase, but financial activities employment weakened 3,000 after increasing 9,000 in July. The number of professional & business services jobs fell 17,000, down for the fourth straight month as temporary help employment declined 9,800, also off for the fourth month in a row. Information sector employment declined 5,000, after falling 7,000 in July and 3,000 in June. Transportation & warehousing hiring weakened 3,600 last month following a 6,300 drop.

Government sector payrolls declined 16,000 last month following a 2,000 rise. Federal government employment weakened 15,000 and has fallen for seven straight months. State government payrolls declined 13,000 after falling in each of the prior three months. To the upside, local government hiring rose 12,000 following a 17,000 July increase.

Private-sector average hourly earnings rose 0.3% (3.7% y/y) in August, the same as in July. Earnings in the goods-producing sector increased 0.4% (4.0% y/y) in August, double the July rise. In construction, earnings rose 0.6% (4.2% y/y) following a 0.3% rise, while factory sector earnings improved 0.3% (3.9% y/y) after a 0.2% gain. In the service sector, earnings rose 0.3% (3.6% y/y) in August, the same as in July. Professional & business services pay increased 0.4% (5.0% y/y) for the second consecutive month while leisure & hospitality earnings also increased 0.4% (3.7% y/y) after two straight months of 0.3% increase. Information earnings rose 0.2% (4.6% y/y) for the second straight month.

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The length of the average workweek was 34.2 hours in August for the third straight month. The workweek in the goods-producing sector eased to 39.8 hours from 39.9 hours in July. The construction sector average workweek held at 39.0 hours while the factory sector workweek eased to 40.0 hours from 40.2 hours. The average workweek in the private service sector held at 33.2 hours. Information sector hours edged up to 37.0 from 36.9. Financial activities hours held at 37.6. Private education & health services hours eased to 32.7 from 32.8 in July.

In the **household survey**, the unemployment rate increased to 4.3% in August after rising to 4.2% in July from 4.1% in June as employment rose 288,000 after falling 260,000 in July and the size of the labor force increased 436,000 after three straight months of decline. The labor force participation rate rose to 62.3% last month from 62.2%, remaining well below the high of 63.3% early in 2020. The rate for teenagers eased to 34.8%, a five-year low. For workers aged 20-24, the rate plunged to 70.2%, a four year-low. For workers aged 25-54, the participation rate increased to 83.7%, an eleven-month high. For individuals 55 and over, the rate held steady at 38.1% but remained near a 20-year low of 38.0% in June.

The employment/population ratio for all workers steadied at 59.6% last month. It remained below the peak reading of 61.1% in February, 2020 just prior to the pandemic. For men, the rate rose to 65.0% from 64.7% in July and for women, the rate eased to 54.5 % on the heels of a slip to 54.7% in July.

The employment and earnings data are collected from surveys taken each month during the week containing the 12th day of the month. The labor market data are contained in Haver's **USECON** database. Detailed figures are in the **EMPL** and **LABOR** databases. The expectations figures are in the **AS1REPNA** database.

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- Hiring weakens broadly; factory, construction & government jobs decline.
- Earnings gain slows y/y.
- Unemployment rate increases as job growth lags rise in labor force.

U.S. Payroll Employment Report Reveals Unexpected Weakness in August; Earnings Rise Steadily, but Jobless Rate Increases

250905E.jpg

Germany's factory orders declined for the third straight month in July. Real new orders fell 2.9% month-on-month in July, against expectations for a small increase. The drop was sharper than a 0.2% decrease in June; foreign orders declined 3.1% in July, as orders from the euro area contracted 3.8%, and orders from outside the euro area fell by 2.8%. These metrics suggest that demand both inside and outside the euro area remains weak. Domestic orders dropped 2.5% in July, an exact offset to their gain in June. When ranked on growth rates over the last 30 years, all three sector growth rates are below their medians (below a ranking of 50%). However, when ranked on the real index number level, total orders rank at their 55.6 percentile, foreign orders rank at their 79.5 percentile and domestic orders rank at their 15.2 percentile. All-in-all it’s an unimpressive report.

**Orders sequentially and QTD:** Sequential trends are ambivalent but still clearly weak. Sequential growth rates do not show a clear acceleration/deceleration pattern. But for total, foreign and domestic real orders, both 3-month and 12-month growth rates are negative (one exception: foreign orders over 12 months). Domestic orders show negative growth over 6 months as well. Quarter-to-date growth rates are negative for all sectors.

**Sales trends:** Real sales are mixed in July, rising 0.9% overall on declines in two sectors: consumer durables and intermediate goods. Sector sales mostly maintain growth as manufacturing sales are positive based on growth rates over 12 months, 6 months, and 3 months. Consumer goods and intermediate goods sales show deceleration and ongoing contraction. Consumer durable goods and intermediate goods show QTD declines. On the manufacturing & mining to total, manufacturing and capital goods show index standings above their respective 50% on 30 years of data. That also shows above-median growth rates on annual data along with consumer goods and consumer nondurable goods.

**Industrial confidence:** Industrial confidence measures for Germany, France, Italy, and Spain, the four largest EMU members, show improved (but still net negative readings) in July compared to June. Over three months and six months, Germany and Italy show some improvement; France still shows steady deterioration. Spain shows improvement over 3 months and it is only slight improvement. The queue standings for the industrial reading over 30 years of data show Spain with an above-median reading in July. Germany and France are exceptionally weak and Italy has been weaker only 26% of the time based on the queue standing measure. Not only are German orders and demand weak and faltering but the broad EU Commission measures of industrial confidence show broadly weak readings for the largest economies in the EMU.

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Germany

German Factory Orders Plunge on Domestic Weakness

Andrew Cates

**Gold prices and trade policy uncertainty**
This week’s record-breaking surge in gold prices has coincided with renewed volatility in trade policy uncertainty, reflecting the market’s heightened sensitivity to political and legal developments in Washington. A series of legislative challenges to the administration’s latest tariff measures has raised the prospect that parts of the policy framework could be overturned or significantly diluted. That possibility has injected another layer of uncertainty into an already fragile trade environment, amplifying demand for gold as a hedge. Investors appear to be weighing not only the inflationary risks of tariffs that remain in place but also the destabilizing effects of unpredictable policy reversals, leaving gold prices at historic highs and the trade policy uncertainty index elevated.

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**US Tariffs**
Although the data in this chart extend only through June 2025, they clearly illustrate which trading partners would gain the most if US tariff policies were to be reversed. China stands out as the most heavily penalised, with effective tariff rates rising by more than 25 percentage points in just six months. Japan and South Korea have also faced significant tariff hikes, suggesting that their exporters would benefit substantially from any policy rollback. Taiwan, India, and the EU also feature prominently, though at more moderate levels. By contrast, ASEAN economies, Australia, and the UK have seen relatively smaller increases, leaving them less exposed. In aggregate, a broad reversal of tariffs would most immediately alleviate the pressure on East Asian exporters—particularly China—while also reducing costs for US importers and consumers who have been disproportionately affected by higher prices on goods from the region.

250904Z2.jpg

**The Indian economy and US trade policy** 
India faces a particularly sharp squeeze from the latest wave of US tariff hikes, given that the US now absorbs nearly one-fifth of its exports. The imposition of higher barriers has dealt a direct blow to key sectors, such as textiles and jewellery, while also undermining investor confidence. That pressure is clearly visible in the sharp depreciation of India’s trade-weighted currency, which has accelerated in 2025. Rather than offering a competitiveness boost, the weaker rupee has compounded difficulties by lifting import costs and stoking inflation at home. The result is that tariffs have both curtailed India’s export earnings and strained its domestic economy, leaving policymakers with limited options beyond seeking trade diversification and targeted support measures.

250904Z3.jpg

**Global monetary policy** 
The latest Blue Chip Financial Forecasts survey helps explain why equity markets have remained upbeat despite escalating geopolitical and trade tensions. The survey points to an expected sizeable policy easing over the coming year, particularly in the US and UK where forecasters anticipate close to a full percentage point of rate cuts. Australia and Canada are also projected to deliver meaningful reductions, while the euro area is expected to ease more modestly. Japan stands out as the exception, with expectations tilted toward further tightening. For equities, these projections of broad-based rate cuts provide a crucial cushion—supporting valuations, lowering discount rates, and reinforcing the sense that policymakers are prepared to offset the drag from tariffs and slowing global growth.

250904Z4.jpg

**Euro area inflation** 
By contrast with the US and UK, where forecasters in the latest Blue Chip Financial Forecasts survey anticipate close to a full percentage point of rate cuts, expectations for the ECB are more restrained. This reflects the fact that the ECB has already delivered a relatively large degree of policy easing, while headline inflation has now fallen back to levels close to its target. Even so, further rate reductions remain likely if underlying price pressures continue to moderate. As the chart shows, services inflation has begun to move lower in line with a clear decline in wage growth, suggesting that disinflationary momentum is building. Should this trend persist, the ECB will have scope to add to its easing cycle, though at a slower and more cautious pace than peers such as the Fed or the Bank of England.

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**Prices and cost pressures in the US corporate sector** 
Corporate profitability has long been one of the best leading signals for US equity cycles, and the measure here (Non-financial corporate profits per unit of output – i.e. profit margins) has slipped from its late-2023 peak and moved sideways for much of the past year. That’s not a collapse, but it does raise questions about how long equities can keep rising without stronger profit momentum. The recent Q2 uptick—a 1.8% annualised gain—came despite a hefty rise in non-labour costs, with margins protected by modest pricing power and a notable 2.2% drop in unit labour costs. Whether that labour relief reflects softer wage pressures or a structural productivity boost—potentially tied to AI—will be crucial in determining if profits can remain resilient, or if this plateau is the prelude to a downturn.

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Equity markets have lost a little ground in recent days and bond markets have been more jittery, as legal challenges to US tariff policies add to a tense backdrop of geopolitical meetings between China, Russia, and India. Gold’s surge to record highs arguably captures the search for safe havens amid this uncertainty (chart 1), while the possibility of tariff reversals keeps alive the prospect of relief for the most affected exporters, notably China, Japan, and South Korea (chart 2). India’s position looks more precarious, with its reliance on the US market colliding with a weakening trade-weighted currency as tariffs bite into growth and investor confidence (chart 3). Monetary policy expectations, however, continue to offer some support, with the latest Blue Chip Financial Forecasts survey pointing to sizeable easing in the US and UK (chart 4). The ECB is expected to tread more cautiously after earlier cuts and with headline inflation now near target. Still, if inflation continues to ease, further action remains possible (chart 5). In the US, corporate resilience is also helping offset some of the gloom: despite tariff-driven spikes in non-labour costs, falling unit labour costs—possibly aided by AI productivity gains—and firmer prices allowed profits per unit of output to rise in Q2 (chart 6).

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Charts of the Week: A Few Cuts More

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The U.S. ISM Services PMI increased to 52.0 in August after falling to 50.1 in July from 50.8 in June, according to the Institute for Supply Management. The index had been declining since it reached 53.5 in February. The index hit a recent high of 55.8 in October of last year and remains below the all-time high of 67.5 in November 2021. The Action Economics Forecast Survey expected a reading of 51.0 for August.

The ISM Composite Index combines the services index and the manufacturing index released on Tuesday. This index rose to 51.6 in August from 49.8 in July. This also was the highest level in six months.

Amongst the services component series, the business activity index rose to 55.0 last month after falling to 52.6 in July. Twenty-three percent (NSA) of respondents reported improved activity while 14.2% reported decline. The new orders index increased to 56.0 from 50.3 in July. Twenty-seven percent (NSA) of respondents reported improved orders while a lessened 16.2% reported decline. The employment series was little-changed in August at 46.5, after falling from 47.2 in June. A lessened 10.3% (NSA) of respondents reported increased employment while a lower 16.8% reported decline. Working lower, the supplier delivery series fell to 50.3 in August after rising to 51.0 in July. Four percent of respondents (NSA) reported faster delivery speeds while 4.5% reported slower speeds.

On the inflation front, the prices index eased to 69.2 after surging to 69.9 in July. A lessened 36.7% (NSA) of respondents reported higher prices while 2.6% reported lower prices. The index has increased from its December 2023 53.1.

Additionally, the new export orders index eased to 47.3 (NSA) in July following a decline to 47.9 in July. Twelve percent of survey respondents reported higher exports while 16.9% reported decline. The imports index surged to 54.6 last month after falling to 45.9 in July. A higher 18.9%% of respondents reported higher imports while a lessened 9.8% reported decline. The inventory change index rose to 53.2 from 51.8 and the order backlog index fell to 40.4 in August after rising to 44.3 in July. These series are not seasonally adjusted and not included in the ISM Services PMI total.

The ISM Services PMI is a composite index consisting of four equally weighted diffusion indexes: Business Activity, New Orders, Employment, and Supplier Deliveries. A reading above 50 indicates expansion in the services sector, while below 50 suggests contraction. Supplier Deliveries is the only ISM index that is inversed; a reading above 50 indicates slower deliveries.

The ISM figures are available in Haver's **USECON** database, with additional detail in the **SURVEYS** database. The expectations figure from Action Economics is in the **AS1REPNA** database.

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- Total index rebounds to six-month high.	
- Business activity and new orders improve.
- Prices index eases.

U.S. ISM Services PMI Increases in August

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The ADP National Employment Report indicated that nonfarm private sector payrolls rose 54,000 (1.1% y/y) during August after increasing 106,000 in July, revised from 104,000 and declining an unrevised 23,000 in June. The Action Economic Forecast Survey expected a 75,000 increase in August.

Small business hiring (less than 50 employees) increased 12,000 (0.4% y/y) in August after an 8,000 July rise, revised from 12,000. Employment at medium-sized firms (50-499 employees) rose 25,000 (1.1% y/y) in August after increasing 53,000 in July, revised from 46,000. Large business hiring (500+ employees) gained 18,000 (2.4% y/y) following a 47,000 July increase, revised from 46,000.

Goods-producing employment rose 13,000 (1.3% y/y) after increasing 32,000 in July. Construction jobs increased 16,000 (2.4% y/y) following a 13,000 gain in July. Manufacturing jobs declined 7,000 (+0.1% y/y), after two months of moderate increase. Natural resources and mining jobs increased 4,000 (4.1% y/y) in August after rising 11,000 in July.

Service-producing jobs increased 42,000 (1.0% y/y) after a 74,000 July gain. Changes amongst industry sectors were mixed. Leisure & hospitality employment rose 50,000 (3.5% y/y) after increasing 45,000 in July. Professional & business jobs improved 15,000 (0.5% y/y) following a 9,000 increase. Information sector employment rose 7,000 (1.1% y/y) after increasing 9,000.  Working lower, trade, transportation & utilities employment fell 17,000 (+0.3% y/y) after rising 20,000 in July. Education & health services posted a 12,000 decline (+0.2% y/y) after falling 40,000 in July. This was the sixth decline in seven months. Financial activities employment slid 2,000 (+1.9% y/y) after a 28,000 strengthening.

By region, in the Northeast the number of jobs rose 15,000 (1.2% y/y) in August following four consecutive monthly declines. Jobs rose 14,000 (1.3% y/y) in the Midwest after increasing 12,000 in July. In the West, jobs rose 8,000 (0.8% y/y) following a 67,000 increase, and in the South, employment rose 4,000 (0.8% y/y) following a 40,000 July strengthening.

Wage growth for job-stayers continued to moderate in August as year/year growth of median annual pay weakened to 4.4% from 4.5% in July, the slowest pace since June 2021. The slowdown in wage growth for job-stayers was widespread across major industries. Wage growth for job-changers was steady at 7.1% y/y, but down from a high of 16.1% in April 2022.

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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- Private payroll job increase is half July’s gain.
- Goods-producing employment slows as factory hiring falls; service-sector jobs also moderate.
- Job-stayer wage growth eases.

Economy in Brief: 2007

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