Tom Moeller

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>
<body>
	 
 
 
 


<a href="/comment/180612n.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612n.png"></a>
 <a href="/comment/180612o.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612o.png"></a>
The U.S. Treasury Department reported that the federal
government ran a $146.8 billion budget deficit during May 2018. That compared to
a $88.4 billion deficit during May 2017. A $119.5 billion had been expected in
the Action Economics Forecast Survey. During the first eight months of fiscal
year 2018, the government's budget deficit totaled $532.2 billion, up 22.9%
versus $432.9 billion in the first eight months of FY'17.
Net revenues rose 2.6% y/y so far in FY'18 after a 1.5%
increase during all of last fiscal year. Individual income taxes increased 9.0%
y/y following a 2.7% rise during all of last fiscal year. The increase in social
insurance receipts eased to 2.1% y/y from 4.2% last year, and excise taxes
improved 11.5% y/y and reversed last year's 11.8% decline. The rate of decline
in corporate income taxes quickened to -25.4% y/y with the corporate income tax
cut, after taxes fell 0.8% during all of last fiscal year.
Government spending increased 5.9% y/y so far in FY'18
compared to 3.3% growth during all of FY'17. National defense spending rose 5.2%
y/y after slight increases during the last two fiscal years. Health insurance
spending grew a steady 4.1% y/y, while Medicare outlays increased an accelerated
2.5% y/y. With the lower unemployment rate, income security payments slipped 0.6%
y/y after their 2.1% FY'17 decline. Social Security payments rose an accelerated
4.3% y/y. Interest payments gained 17.5% y/y so far in FY'18 after increasing
9.2% last fiscal year.
Haver's data on Federal Government outlays and receipts are
contained in USECON. Considerable detail is given in the separate GOVFIN
database. The Action Economics Forecast Survey numbers are in the AS1REPNA
database.

<a href="/comment/180612p.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612p.png"></a>
 <a href="/comment/180612q.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612q.png"></a>



<table class="centered" width="100%" border="0" cellspacing="0">
	<colgroup><col><col><col><col><col><col><col><col></colgroup>
 <colgroup>
 <col>
 <col>
 <col>
 <col>
 <col>
 <col>
 <col>
 <col>
 </colgroup>
 <thead>
 <tr>
 <th class="firstcol" scope="col" >United States Government
 Finance</th>
 <th scope="col" ></th>
 <th scope="col" >May 2018</th>
 <th scope="col" >FY'17</th>
 <th scope="col" >FY'16</th>
 <th scope="col" >FY'15</th>
 <th scope="col" >FY'14</th>
 <th scope="col" >FY'13</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" >Budget Balance (Billions)</td>
 <td>--</td>
 <td>$-146.8</td>
 <td>$-665.7</td>
 <td>$-585.6</td>
 <td>$-439.1</td>
 <td>$-483.4</td>
 <td>$-680.2</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;As a percent of GDP</td>
 <td>--</td>
 <td>--</td>
 <td>3.5%</td>
 <td>3.2%</td>
 <td>2.5%</td>
 <td>2.8%</td>
 <td>4.1%</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" ></td>
 <td>% of Total</td>
 <td></td>
 <td></td>
 <td></td>
 <td></td>
 <td></td>
 <td></td>
 </tr>
 <tr>
 <td class="firstcol" >Net Revenues (Fiscal Year YTD 2018, Y/Y %
 Change)</td>
 <td>100</td>
 <td>2.6%</td>
 <td>1.5%</td>
 <td>0.6%</td>
 <td>7.6%</td>
 <td>8.9%</td>
 <td>13.3%</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Individual Income Taxes</td>
 <td>47</td>
 <td>9.0</td>
 <td>2.7</td>
 <td>0.3</td>
 <td>10.5</td>
 <td>5.9</td>
 <td>16.3</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Corporate Income Taxes</td>
 <td>9</td>
 <td>-25.4</td>
 <td>-0.8</td>
 <td>-12.9</td>
 <td>7.2</td>
 <td>17.3</td>
 <td>12.9</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Social Insurance Taxes</td>
 <td>34</td>
 <td>2.1</td>
 <td>4.2</td>
 <td>4.7</td>
 <td>4.1</td>
 <td>8.0</td>
 <td>12.1</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp; Excise Taxes</td>
 <td>3</td>
 <td>11.5</td>
 <td>-11.8</td>
 <td>-3.3</td>
 <td>5.3</td>
 <td>11.1</td>
 <td>6.3</td>
 </tr>
 <tr>
 <td class="firstcol" ></td>
 <td></td>
 <td></td>
 <td></td>
 <td></td>
 <td></td>
 <td></td>
 <td></td>
 </tr>
 <tr>
 <td class="firstcol" >Net Outlays&nbsp; (Fiscal Year 2017 YTD,
 Y/Y % Change)</td>
 <td>100</td>
 <td>5.9</td>
 <td>3.3</td>
 <td>4.5</td>
 <td>5.3</td>
 <td>1.4</td>
 <td>-2.4</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;National Defense</td>
 <td>15</td>
 <td>5.2</td>
 <td>0.8</td>
 <td>0.7</td>
 <td>-2.3</td>
 <td>-4.7</td>
 <td>-6.3</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Health</td>
 <td>15</td>
 <td>4.1</td>
 <td>4.1</td>
 <td>6.2</td>
 <td>17.8</td>
 <td>14.3</td>
 <td>3.3</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Medicare</td>
 <td>15</td>
 <td>2.5</td>
 <td>0.6</td>
 <td>8.7</td>
 <td>6.7</td>
 <td>2.8</td>
 <td>5.5</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Income Security</td>
 <td>13</td>
 <td>-0.6</td>
 <td>-2.1</td>
 <td>1.0</td>
 <td>-0.9</td>
 <td>-4.3</td>
 <td>-1.1</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Social Security</td>
 <td>24</td>
 <td>4.3</td>
 <td>3.1</td>
 <td>3.2</td>
 <td>4.4</td>
 <td>4.5</td>
 <td>5.2</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp; Veterans Benefits &amp; Services</td>
 <td>4</td>
 <td>6.4</td>
 <td>1.2</td>
 <td>9.3</td>
 <td>6.8</td>
 <td>7.7</td>
 <td>11.5</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp; Education, Training, Employment
 &amp; Social Services</td>
 <td>4</td>
 <td>6.5</td>
 <td>31.6</td>
 <td>-10.2</td>
 <td>34.7</td>
 <td>25.9</td>
 <td>-21.9</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Interest</td>
 <td>7</td>
 <td>17.5</td>
 <td>9.2</td>
 <td>7.8</td>
 <td>-1.8</td>
 <td>2.8</td>
 <td>0.4</td>
 </tr>
 </tbody>
</table>


</body>

</html>

The U.S. Treasury Department reported that the federal government ran a $146.8 billion budget deficit during May 2018. That compared to a $88.4 billion deficit during May 2017. A $119.5 billion had been expected in the Action [...]

U.S. Government Budget Deficit Continues to Increase Y/Y

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>

	 
 
 
 


<a href="/comment/180612j.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612j.png"></a>
 <a href="/comment/180612k.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612k.png"></a>
The National Federation of Independent Business (NFIB)
indicated that its Small Business Optimism Index increased to 107.8 during May
following two months near 104.8. It was the strongest reading since the third
quarter of 1983. 
A record 34% of firms indicated that now was a good time to
expand the business. A stronger 30% of firms planned to make capital outlays,
the most in nine months. A higher 37% of firms expected the economy to improve,
the most in three months; but that remained down below the 2017 average of 39%.
A greatly increased 31% of firms were expecting higher real sales, the most in
six months. Eighteen percent of businesses were planning to increase employment.
That was up m/m but still well below the 24% November high. Meanwhile, a
lessened 48% indicated that there were few or no qualified candidates for job
openings, down from the December high of 54%.
Pricing pressure strengthened as a net 19% of firms were
raising average selling prices, the most since September 2008. Twenty-six
percent of firms were planning to raise prices, also a ten year high. A record 35%
of firms increased worker compensation, but a lower 20% of businesses were
planning to raise compensation.
Finding the financial resources to expand business remained
relatively easy. A stable five percent of businesses reported difficulties in
obtaining credit, up from three percent during the first quarter.
This survey inquires about problems facing small business.
The most pressing problem in May continued to be labor quality as a near-record
23% indicated a problem, up from four percent in 2010. A lower six percent of
firms reported the cost of labor as the most significant problem. Government
requirements became much less worrisome at 13%, down from 22% in 2015. A
still-low 18% indicated that taxes were the largest problem, down from a
December 2014 high of 27%. Competition from large businesses remained high at
10%, and insurance costs/availability worried a lessened 10%. Poor sales
remained at an expansion low of 8% while financial &amp; interest rate problems
(1%) remained negligible. Price inflation problems strengthened to a six month
high of three percent reporting a problem.&nbsp;
Roughly 24 million small businesses exist in the U.S. and
they create 80% of all new jobs. The index is based 1986=100. The typical NFIB
member employs 10 people and reports gross sales of about $500,000 a year.
The NFIB figures can be found in Haver's SURVEYS
database.
<a href="/comment/180612l.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612l.png"></a>
 <a href="/comment/180612m.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612m.png"></a>



<table class="centered" width="100%" border="0" cellspacing="0">
	<colgroup><col><col><col><col><col><col><col><col></colgroup>
 <thead>
 <tr>
 <th class="firstcol" scope="col" >National Federation of
 Independent Business (SA, Net % of Firms)</th>
 <th scope="col" >May</th>
 <th scope="col" >Apr</th>
 <th scope="col" >Mar</th>
 <th scope="col" >May'17</th>
 <th scope="col" >2017</th>
 <th scope="col" >2016</th>
 <th scope="col" >2015</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" >Small Business Optimism Index (1986=100)</td>
 <td >107.8</td>
 <td >104.8</td>
 <td >104.7</td>
 <td >104.5</td>
 <td >104.9</td>
 <td >95.3</td>
 <td >96.1</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Firms Expecting Economy to Improve</td>
 <td >37</td>
 <td >30</td>
 <td >32</td>
 <td >39</td>
 <td >39</td>
 <td >-5</td>
 <td >-5</td>
 </tr>
 <tr>
 <td class="firstcol" >Firms Expecting Higher Real Sales</td>
 <td >31</td>
 <td >21</td>
 <td >20</td>
 <td >22</td>
 <td >23</td>
 <td >5</td>
 <td >8</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Firms Reporting Now Is a Good Time to
 Expand the Business</td>
 <td >34</td>
 <td >27</td>
 <td >28</td>
 <td >23</td>
 <td >23</td>
 <td >10</td>
 <td >12</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Firms Planning to Increase Employment</td>
 <td >18</td>
 <td >16</td>
 <td >20</td>
 <td >18</td>
 <td >18</td>
 <td >11</td>
 <td >12</td>
 </tr>
 <tr>
 <td class="firstcol" >Firms With Few or No Qualified
 Applicants for Job Openings (%)</td>
 <td >48</td>
 <td >50</td>
 <td >47</td>
 <td >51</td>
 <td >49</td>
 <td >46</td>
 <td >46</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Firms Reporting That Credit Was Harder
 to Get</td>
 <td >5</td>
 <td >5</td>
 <td >4</td>
 <td >3</td>
 <td >4</td>
 <td >5</td>
 <td >4</td>
 </tr>
 <tr>
 <td class="firstcol" >Firms Raising Average Selling Prices</td>
 <td >19</td>
 <td >14</td>
 <td >16</td>
 <td >7</td>
 <td >7</td>
 <td >0</td>
 <td >2</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Firms Raising Worker Compensation</td>
 <td >35</td>
 <td >33</td>
 <td >33</td>
 <td >28</td>
 <td >27</td>
 <td >24</td>
 <td >23</td>
 </tr>
 </tbody>
</table>
</html>

The National Federation of Independent Business (NFIB) indicated that its Small Business Optimism Index increased to 107.8 during May following two months near 104.8. It was the strongest reading since the third quarter of 1983. A [...]

U.S. Small Businesses Optimism Strengthens Dramatically

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>

	 
 
 
 


<a href="/comment/180612f.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612f.png"></a>
 <a href="/comment/180612g.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612g.png"></a>
Consumer prices increased 0.2% (2.8% y/y) during May for the
second straight month. The gain matched expectations in the Action Economics
Forecast Survey. The CPI excluding food &amp; energy rose an expected 0.2% (2.2%
y/y) after a 0.1% rise. 
Last month's increase was led by a 0.9% rise (11.7% y/y) in
energy prices which followed a 1.4% strengthening during April. Gasoline prices
increased 1.7% (21.8% y/y) after a 3.0% rise, but fuel oil costs fell 0.7% (+25.3%
y/y) on the heels of a 2.7% increase. Electricity prices ticked 0.1% higher (1.0%
y/y) after a 0.6% decline, but natural gas prices fell 0.6% (-0.8% y/y), off for
the third consecutive month.
Goods prices excluding food &amp; energy slipped 0.1% for the
third straight month. The 0.3% y/y decline in prices, however, moderated from
the 1.0% y/y drop in October. Prices for used cars &amp; trucks fell 0.9% (-1.7%
y/y), down for the fourth straight month. New vehicle prices increased 0.3% (-1.1%
y/y) after declines in three of the prior four months. Recreation product prices
fell 0.7% (-3.3% y/y) as prices for video &amp; audio products dropped 0.8% for
the third straight month (-12.6% y/y). Furniture &amp; bedding costs were off
0.3% (-0.1% y/y), but appliance prices rose 0.3% (-0.1% y/y) following two
months of strong increase. Medical care product prices surged 1.3% (2.7% y/y)
after a slight dip, but apparel prices held steady (-1.4% y/y) following a 0.3%
rise.
Services prices less energy increased 0.3% (3.0% y/y) after a
0.2% rise. Recreation services led the gain with a 0.4% rise (+1.8% y/y) which
followed two months of decline. Education &amp; communication services prices
also improved 0.4% (0.7% y/y) after declining during each of the prior four
months. Shelter prices rose 0.3% (3.5% y/y) for the second straight month
reflecting a 0.3% increase (3.6% y/y) in rents of primary residences. The
owners' equivalent rent of primary residences increased 0.3% (3.4% y/y) for the
third straight month. Medical care services prices eased 0.1% (+2.3% y/y) after
a 0.2% gain, but public transportation costs fell 1.2% (-2.8% y/y) led by a 1.9%
drop (-6.6% y/y) in airline fares. 
Food prices held steady last month (1.2% y/y) after
increasing 0.3% in April. Fruit &amp; vegetable prices eased 0.3% (-0.4% y/y)
after a 1.0% jump. Meat prices declined 0.7% (+1.4% y/y). Egg prices fell 3.3%,
but were up by nearly one-quarter y/y. Dairy &amp; related product prices eased
0.1% (-0.6% y/y), after a 0.4% rise. Cereal &amp; bakery product prices held
steady (-0.2% y/y), following a 0.2% dip. Nonalchoholic beverage prices rose
0.4% (-1.3% y/y), after a 0.6% decline. 
The consumer price data can be found in Haver's USECON
database with additional detail in CPIDATA. The Action Economics survey
figure is in the AS1REPNA database.

<a href="/comment/180612h.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612h.png"></a>
 <a href="/comment/180612i.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612i.png"></a>



<table class="centered" width="100%" border="0" cellspacing="0">
	<colgroup><col><col><col><col><col><col><col><col></colgroup>
 <thead>
 <tr>
 <th class="firstcol" scope="col" >Consumer Price Index, All
 Urban Consumers (% chg)</th>
 <th scope="col" >May</th>
 <th scope="col" >Apr</th>
 <th scope="col" >Mar</th>
 <th scope="col" >May Y/Y</th>
 <th scope="col" >2017</th>
 <th scope="col" >2016</th>
 <th scope="col" >2015</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" >Total</td>
 <td>0.2</td>
 <td>0.2</td>
 <td>-0.1</td>
 <td>2.8</td>
 <td>2.1</td>
 <td>1.3</td>
 <td>0.1</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Total less Food &amp; Energy</td>
 <td>0.2</td>
 <td>0.1</td>
 <td>0.2</td>
 <td>2.2</td>
 <td>1.8</td>
 <td>2.2</td>
 <td>1.8</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Goods less Food &amp; Energy</td>
 <td>-0.1</td>
 <td>-0.1</td>
 <td>-0.1</td>
 <td>-0.3</td>
 <td>-0.7</td>
 <td>-0.5</td>
 <td>-0.5</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Services less Energy</td>
 <td>0.3</td>
 <td>0.2</td>
 <td>0.3</td>
 <td>3.0</td>
 <td>2.7</td>
 <td>3.1</td>
 <td>2.6</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;Food</td>
 <td>0.0</td>
 <td>0.3</td>
 <td>0.1</td>
 <td>1.2</td>
 <td>0.9</td>
 <td>0.3</td>
 <td>1.9</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;Energy</td>
 <td>0.9</td>
 <td>1.4</td>
 <td>-2.8</td>
 <td>11.7</td>
 <td>7.9</td>
 <td>-6.6</td>
 <td>-16.7</td>
 </tr>
 </tbody>
</table>
</html>

Consumer prices increased 0.2% (2.8% y/y) during May for the second straight month. The gain matched expectations in the Action Economics Forecast Survey. The CPI excluding food & energy rose an expected 0.2% (2.2% y/y) after a 0.1% [...]

U.S. CPI Increases Steadily M/M; Core Prices Pick Up

Robert Brusca

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>

	 

 
 
 


<a href="/comment/180612e.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612e.png" align="left"></a>


The Zew experts are decidedly less upbeat than they were. The Zew financial experts assessments still have roughly the same sorts of rankings that had prevailed earlier with strong rankings on current assessments and more pessimism on outlook rankings with still-elevated inflation readings. But in June especially these ranks have changed, eroding for current assessments and expectations while inflation expectations have softened. The world according to Zew has shifted and may still be shifting.

The Zew assessment of current conditions has taken a huge step back for some countries or areas but not for all. The Euro-Area that has had raw diffusion readings for its macroeconomic situation in the 56 to 57 reading area since January has now dived to show a macroeconomic assessment of 39.9; its weakest since October. But despite this outsized step back, the queue standing for the Area remains high in its 87.7th percentile. Germany, where the monthly macro-assessments have been at 86 or higher since June of last year, has slipped to a reading of 80.6 in June. It has slipped to its weakest reading since April of last year. And some of the weakest German economic readings for orders and industrial output have only been released in the past several days so Zew experts may still have some trimming to do on the German assessment. France's assessment has been reduced by very little this month but it has been slipping for several months. The French assessment has morphed from a reading that was negative in in September of last year to a peak in February of this year and has undergone slippage ever since. Still, France has a queue standing in its 88th percentile at a much lower diffusion value than EMU and Germany but with about the same queue percentile standing. Italy has been sharply downgraded in the wake of its elections to a -32.8 diffusion reading down from -18.5 one month ago. Italy has negative readings since March and has been slipping since January.

The macroeconomic assessment for the US is nearly unchanged on the month, lower by 1.4 points in June compared to May and back within one tick of its April reading. The US maintains a 97 percentile queue standing for its macroeconomic assessment. All this seems to green-light the Fed for its agenda of rate increases but what that will do to exchange rates globally is another matter.

Japan's macroeconomic assessment was knocked back to 19.4 from a 30.2 assessment, Japan's assessment had been in the high twenties to thirties since November of last year but it is down in June and was last lower in October of 2017.

The UK is the only country in the table with an improved macroeconomic reading on the month, although its raw reading is still negative. The UK has a long string of mostly negative readings stemming from its adoption of Brexit. It has had its weakest reading around October of last year but May did bring the UK reading lower and in June the UK, against the global trend, recouped only a small portion of the May drop. On balance it's hard to call the UK much of an exception and it continues to have the one of the weakest queue standing in the table for expected macroeconomic conditions (only Italy is worse off).

The current assessment took large reductions generally but every generalization has its exceptions. The macroeconomic expectations are worse across the board and on average worsened more that did the current assessments. But the expectations have worsened the most for Italy with a 31 point one month drop and then for France with an 11 point one month drop. Italy now has the lowest queue standing (worse historically only 3.3% of the time) followed by the UK with a 13.7 percentile standing, Germany with a 14.6 percentile standing and Japan with a 16 percentile standing. Macroeconomic expectations in the US and France have the strongest queue standing with the US at a 28 percentile reading and France at its 25th percentile. None of these is impressive.

In line with stepped back current conditions and a weaker macroeconomic outlook the outlook for inflation has pulled back in all survey areas. Germany and the US have seen inflation expectations lowered by the most by 15.5 diffusion points in Germany and by 14.4 points in the US. But inflation expectations are still strong with a an 85.8 percentile standing for EMU and an 84 percentile standing in the US and in Germany- France and Italy have even higher inflation expectations standings in their respective 88.7th and 87.3 percentile standings.

On this view you can see what I mean by my opening remarks. While there have been some dramatic changes in terms of diffusion points shed and assessments for Italy have worsened dramatically (but, interestingly, not for inflation) the rankings show more or less the same conditions as those that had prevailed before. Current conditions are still strong, inflation expectations are still high and macroeconomic expectations are weak.

The Zew assessment summary table puts all the queue assessment rankings together for the forecasted variables by country and region. At the table bottom unweighted averages show some key summary statistics. Note that the largest (absolute value) change is for stock market expectations and that Zew experts are looking for a decisive pull back in stocks compared to last month's profile. Short term rates are seen mixed (little changed) while long terms rate levels are seen lower possibly a reaction to the lowered expected inflation outlook.

On balance the Zew readings show degradation in the outlook that is a downgrade of a global nature. It fits in with remarks offered to today by the IMF's Christine Lagarde who warned of a darkening outlook and one that is darkening day by day. I find is it unsettling that Ms. Lagarde has put the US and tariffs as the keystone in this reduced outlook. While I do not disagree that the US stance is a catalyst of sorts for events, the US is only seeking redress for policies that long have given it inferior standing and it is the reluctance of US trade partners to cut the US a better fairer deal that contributes to this being a problem. I understand that role that the US in playing in this process but is anyone of any global standing going to stand up and admit that what we are observing is the demonization of US trade policy but in reality it is nothing more than ‘the pot calling the kettle black.'



<img border="0" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612.png" width="645" height="540">
</html>

The Zew experts are decidedly less upbeat than they were. The Zew financial experts assessments still have roughly the same sorts of rankings that had prevailed earlier with strong rankings on current assessments and more pessimism on [...]

Zew Assessments Take a Hit in June

Peter D'Antonio

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>

	 
 
 
 

<a href="/comment/180612a.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612a.png"></a>
 <a href="/comment/180612b.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612b.png"></a>

Retail gasoline prices eased to $2.91 per gallon last week (+23.0% y/y) from $2.94 per gallon during the prior week. This was the second consecutive weekly decline, which probably signals the end of the traditional price increase in anticipation of the summer driving season. Haver Analytics constructs factors adjusting for the seasonal variation in gasoline pump prices. The seasonally-adjusted price fell slightly to $2.74 per gallon.
West Texas Intermediate crude oil prices declined to an average of $65.34 (+40.4% y/y) per barrel last week, which was down from $66.97 per barrel in the week prior and from the recent high of $71.31 per barrel three weeks ago. Brent crude oil prices eased to an average of $75.92 per barrel last week and were $76.43 yesterday.
Natural gas prices increased to an average of $2.88/mmbtu last week (-2.4% y/y) from $2.86/mmbtu and were $2.95 yesterday.
In the four-weeks ending June 1, gasoline demand declined 1.1% y/y, while total petroleum product demand edged up 0.2% y/y. Gasoline inventories declined 0.6% y/y, while inventories of all petroleum products dropped 8.0% y/y. Crude oil input to refineries declined 2.0% y/y in the last four weeks.
These data are reported by the U.S. Department of Energy. The price data can be found in Haver's WEEKLY and DAILY databases. Greater detail on prices, as well as the demand, production and inventory data, along with regional breakdowns, are in OILWKLY.

<a href="/comment/180612c.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612c.png"></a>
 <a href="/comment/180612d.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180612d.png"></a>



<table class="centered" width="100%" border="0" cellspacing="0">
	<colgroup><col><col><col><col><col><col><col><col></colgroup>
 <thead>
 <tr>
 <th class="firstcol" scope="col" >Weekly Energy Prices</th>
 <th scope="col" >06/11/18</th>
 <th scope="col" >06/04/18</th>
 <th scope="col" >05/28/18</th>
 <th scope="col" >Y/Y %</th>
 <th scope="col" >2017</th>
 <th scope="col" >2016</th>
 <th scope="col" >2015</th>
 </tr>
 </thead>
 <tbody>
 <tr class="odd" >
 <td class="firstcol" >Retail Gasoline ($ per Gallon Regular,
 Monday Price)</td>
 <td >2.91</td>
 <td >2.94</td>
 <td >2.96</td>
 <td >23.03</td>
 <td >2.47</td>
 <td >2.31</td>
 <td >2.03</td>
 </tr>
 <tr>
 <td class="firstcol" >Light Sweet Crude Oil, WTI ($ per bbl,
 Previous Week's Average)</td>
 <td >65.34</td>
 <td >66.97</td>
 <td >70.97</td>
 <td >40.40</td>
 <td >50.87</td>
 <td >43.22</td>
 <td >48.90</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Natural Gas ($/mmbtu, LA, Previous
 Week's Average)</td>
 <td >2.88</td>
 <td >2.86</td>
 <td >2.83</td>
 <td >-2.44</td>
 <td >2.96</td>
 <td >2.49</td>
 <td >2.62</td>
 </tr>
 </tbody>
</table>
&nbsp;
</html>

Retail gasoline prices eased to $2.91 per gallon last week (+23.0% y/y) from $2.94 per gallon during the prior week. This was the second consecutive weekly decline, which probably signals the end of the traditional price increase in [...]

U.S. Petroleum Prices Ease Slightly

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>

	 

 
 
 


<a href="/comment/180611e.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180611e.png" align="left"></a>

UK manufacturing sector IP growth fell sharply in April and declined for the third month in a row. Sequential rates of growth for manufacturing IP are getting progressively weaker and in the quarter-to-date (April’s growth positioned and annualized over the Q1 average). IP growth in the UK is contracting sharply. The decline in UK IP was unexpected but it fits in with a rash of IP weakness across Europe that also dove-tails with weakening European PMI gauges. And this is happening in a big week of central bank meetings where it is expected that central bankers will declare themselves to be on the yellow brick road to growth and adopt more policy normalcy…but should they?

The European and global economies are dealing with any number of subtle shocks at the moment. I call them ‘subtle’ because while some of them are a subtle as a blow by a sledgehammer they are also effects that stem from fears of events that have not yet happened. It is always difficult to judge how far ahead of an act markets or economies are going to react. It is not clear what discount factor will be applied to events that have not yet happened and especially to events that speculatively may not even come to fruition. And we have such things hanging in the balance now.


Special events 
The most pressing concern for the UK is the transition under Brexit. This is a well-known phenomenon with a relatively firm transition period. But while the transition point is relatively well pinned down, the new terms and conditions of life under a Brexit regime are not determined. Markets reacting to Brexit are reacting to the unknown and in some cases firms are switching the domicile of their business to ensure that whatever Brexit brings they will be able to continue to perform. More subtle are the restive populist political movements in Europe especially in Italy where the Five Star Movement has become the dominant political party. After some saber rattling about leaving EMU, adopting the lira, or initiating a referendum on EU and EMU membership and wanting debt forgiveness the Five Star coalition with the Northern League has put the toothpaste back into the tube but there is no certainty about how long this coalition that has nurtured some harsh language in the past will continue to be passive. Finally there are the new US pressures over trade and the clear and present dangers of tariff threats and Europe’s own threats of reprisals against the US. This also includes ongoing US angst about funding so much of Europe’s defense when many nations of Europe do not pay their way in NATO as they had once agreed.

The CBI on Brexit 
On the issue of Brexit, the Confederation of British Industry (CBI), has weighed in today; it warns that the UK economy will shift to a slower gear this year and that risks have risen that growth will remain undernourished because of the Brexit transition. The CBI says it has cut its growth forecasts for the year, because of heavy snowfall in the opening months of 2018 and lingering fears over Brexit. The group now expects the growth rate for the British economy to slow to 1.4%, from 1.8% last year. GDP growth is expected to slip again, to 1.3% the next year, as the UK bids a fond (or not so fond) farewell to the EU.

Add in the ills from the ongoing and heightened trade spat with the US that became intensified by the G7 summit and there are ample reasons to expect that businesses might not be planning and investing for a better future despite solid global growth and broadly lowered rates of unemployment globally.

This is much bigger than Brexit and the UK 
My view of much of this is that we are still transitioning from the Post War period. World War II was devastating thing to the European area and to much of Asia. The US was never geographically a site of conflict. In the post war period a lot of effort was made to rebuild relationships and to repair physical properties ranging from factories to infrastructure to simple housing. There were also massive population relocations, post-war. The US cut the combatants- both allies and former enemies some slack is setting up post war trade relationships. Europe that has always been more socialistic than the US and was allowed to keep some market protections that the US did not demand for itself in trade, But now the Post War period is far behind us. While Europeans are used to this system and their special exceptions (like imposing tariffs on US goods when the US imposes no tariffs on theirs) the time for special treatment is past. Each and every G7 country with the possible exception of the UK runs consistent and stable trade surpluses in their bilateral trade with the US. Exchange rates do not change to remove or ameliorate this condition. The affluent US market is a source of demand for everyone to tap. But the US is not as rich or as competitive as it once was- especially not at current exchange rate levels.

Moreover, the once-accepted view of "unilateral Free trade" espoused by many US economists has proved itself an Achilles heel for US growth. With the US running a system of free trade for imports but others engaged in less than free trade on US exports and with exchange rates not being allowed to adjust to clear imbalances the US has become specialized in demand while Asia has become a supply center for the global economy. AND that is NOT what free trade means. It is not what ‘specialization’ means. Donald Trump’s desire to restore better-balanced two way trade flows is not being embraced overseas where changes will be needed. And as we see today with French farmers setting up blockades because imported palm oil will be allowed to be mixed in local gasoline stocks Europeans are activists protecting their ‘historic’ interests justified or not. A Bosnian blockade is also in play in Europe over high fuel prices. Europe does suffer economic activism over change. In France PM Macron has suffered through a persistent nationwide rail strike as he has tried to introduce modernization and as workers resist. Europe is hopelessly stuck in the socialistic Post War period and attempts to jolt it out of its niche find the European press referring to Trump’s plea for Free trade as ‘spew’ (here for an example from Reuters).

US President Donald Trump seems to make enemies much faster than he makes friends. He is arrogant, narcissistic and ham-handed in his political dealings. But none of that makes him wrong in this policy pursuit. While the US has ample reason to lash out at the way its trade is affected, Trump’s choice of National Security to protect metals trade pushes the envelope of logic. But maybe that is his plan as well, to use an outlandish WTO-allowed trick to drive his point home about how the US has been treated and cheated. Sometimes it is better simply not to try to understand Mr. Trump, but to treat him and his actions as simply existential.

Any way you slice it the US has been the protector of Europe for 60-years on. Angela Merkel dissed Mr. Trump as a ‘bad ally’ for his taunts suggesting that US obligations under NATO were in some way malleable when he first took office. He made it clear that he expected European and German obligations would be paid in to support of NATO as they had agreed. And after that spat and after calling the US a ‘bad ally’ Germany this year is CHOOSING to run a budget surplus instead of paying in its full share to its NATO commitment. So who is the real bad ally here? Who are the real unfair traders? Why does Trump’s rooting around in the legacy of Post War custom and practice makes him a bad guy? Oh his demeanor? Yes I get it. But what about the substance of the issues at hand? How does Europe justify any notion of ‘retaliation for all the support that the US given it and continues to give it? And is it any wonder that firms are pulling back in the UK and elsewhere in the wake of this kind of selfishness? If Trump is ‘spewing’ by pointing out Europe’s structural intransigence, what is Europe guilty of? And is Europe really going to try to hide from its lapsed responsibilities by playing tit-for-tat each time the US does something to try to even the very uneven playing field that is made clear every month when new trade figures report further European surpluses in trade with the US?


<img border="0" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180611.png" width="645" height="300">
</html>

UK manufacturing sector IP growth fell sharply in April and declined for the third month in a row. Sequential rates of growth for manufacturing IP are getting progressively weaker and in the quarter-to-date (April’s growth positioned [...]

A Souring of UK IP and The Outlook

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>
<body>
	 
 
 
 

<a href="/comment/180611a.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180611a.png"></a>
 <a href="/comment/180611b.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180611b.png"></a>

The Industrial Materials Price Index from the Foundation for
International Business and Economic Research (FIBER) improved 1.3% during the
last four weeks and 12.9% during the last year. Industrial materials prices
overall have risen by roughly one-third versus the early-2016 low. A 1.9% y/y
increase in industrial sector output prompted the gain as it followed 1.7% growth during 2017.
Price increases have been broad-based.
Prices in&nbsp; the miscellaneous group exhibited the
most strength with a 3.0% gain during the
last four weeks and a 13.4% rise during the past year. Framing lumber prices
strengthened 10.9% last month, up by nearly one half y/y. Prices for
structural panels improved 6.2% during the last four weeks and rose 42.8% during the last year.
Lower prices for natural rubber offset some of this strength with a 3.6% decline
last month and remained down 2.7% y/y. In the metals sector, prices
firmed 1.7% during the last month and improved 21.1% y/y. The gain was led by an
8.6% rise (20.1% y/y) in the cost of lead as well as a 4.2% increase (27.7% y/y)
in zinc prices. Copper scrap costs strengthened 3.6% m/m and 25.8% y/y.
Offsetting these gains was a 3.7% one-month fall (+27.6% y/y) in steel scrap
prices as well as a 0.6% four-week easing (+21.3% y/y) in aluminum prices. In the textile group,
prices overall improved 0.9% (2.5% y/y).
<a href="/comment/180611c.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180611c.png"></a>
 <a href="/comment/180611d.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180611d.png"></a>

Cotton prices surged 7.2% over the last month (18.8% y/y), but burlap prices fell
1.5% m/m and were down 2.5% during the past year. In the crude
oil &amp; benzene sector, prices declined 2.3% last month, but rose 15.0% y/y.
Crude oil prices declined 7.3% m/m to an average $65.34 per barrel, but were up
by more than one-third y/y. Benzene prices rose by 2.6% in the last four weeks
(13.5% y/y).&nbsp;&nbsp;
Further strength in prices overall may be coming. The
consensus forecast for industrial output from the National Association for
Business Economics (NABE) calls for a 3.8% rise in 2018 and 2.8% growth in 2019.
During the last ten years, there has been 50% correlation between the
three-month change in prices and the change in U.S. industrial output. In
addition, factory sector production in the European Union and Japan continues to
improve.
Commodity price data can be found in Haver's DAILY,
WEEKLY, USECON and CMDTY databases. The NABE forecast is in the SURVEYS
database.

<a href="/comment/180611f.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180611f.png"></a>
 <a href="/comment/180611g.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/180611g.png"></a>



<table class="centered" width="100%" border="0" cellspacing="0">
	<colgroup><col><col><col><col><col><col><col><col></colgroup>
 <tbody>
 <tr>
 <th class="firstcol" scope="col" >FIBER Industrial Materials
 Price Index (%)</th>
 <th scope="col" >1-Mth</th>
 <th scope="col" >3-Mth</th>
 <th scope="col" >6-Mth</th>
 <th scope="col" >12-Mth</th>
 <th scope="col" >2017</th>
 <th scope="col" >2016</th>
 <th scope="col" >2015</th>
 </tr>
 </tbody>
 <tbody>
 <tr>
 <td class="firstcol" >All Items</td>
 <td >1.3</td>
 <td >1.7</td>
 <td >8.2</td>
 <td >12.9</td>
 <td >6.7</td>
 <td >19.2</td>
 <td >-16.3</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" >&nbsp;Textiles</td>
 <td >0.9</td>
 <td >0.5</td>
 <td >2.6</td>
 <td >2.5</td>
 <td >3.0</td>
 <td >2.8</td>
 <td >2.2</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Cotton (cents per pound)</td>
 <td >7.2</td>
 <td >8.6</td>
 <td >23.0</td>
 <td >18.8</td>
 <td >9.8</td>
 <td >10.2</td>
 <td >2.6</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" >&nbsp;Metals</td>
 <td >1.7</td>
 <td >2.0</td>
 <td >8.6</td>
 <td >21.1</td>
 <td >18.6</td>
 <td >32.9</td>
 <td >-27.8</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Aluminum ($ per metric ton)</td>
 <td >-0.6</td>
 <td >8.9</td>
 <td >13.6</td>
 <td >21.3</td>
 <td >26.0</td>
 <td >13.0</td>
 <td >-19.2</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Copper Scrap (cents per
 pound)</td>
 <td >3.6</td>
 <td >2.1</td>
 <td >5.6</td>
 <td >25.8</td>
 <td >29.3</td>
 <td >17.3</td>
 <td >-27.0</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Steel Scrap ($ per ton)</td>
 <td >-3.7</td>
 <td >6.9</td>
 <td >31.7</td>
 <td >27.6</td>
 <td >16.8</td>
 <td >74.5</td>
 <td >-53.8</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" >&nbsp;Crude Oil &amp; Benzene</td>
 <td >-2.3</td>
 <td >1.8</td>
 <td >2.8</td>
 <td >15.0</td>
 <td >8.1</td>
 <td >20.4</td>
 <td >-19.4</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Crude Oil (WTI, $ per Barrel)</td>
 <td >-7.3</td>
 <td >6.6</td>
 <td >14.5</td>
 <td >39.3</td>
 <td >10.9</td>
 <td >44.3</td>
 <td >-35.8</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" >&nbsp;Miscellaneous</td>
 <td >3.0</td>
 <td >2.3</td>
 <td >15.2</td>
 <td >13.4</td>
 <td >-0.5</td>
 <td >21.7</td>
 <td >-18.0</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Framing Lumber ($ per 1000
 board ft.)</td>
 <td >10.9</td>
 <td >13.7</td>
 <td >33.5</td>
 <td >44.8</td>
 <td >20.0</td>
 <td >12.9</td>
 <td >-16.4</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Natural Rubber (cents per
 pound)</td>
 <td >-3.6</td>
 <td >-0.2</td>
 <td >9.3</td>
 <td >-2.7</td>
 <td >-29.6</td>
 <td >89.4</td>
 <td >-22.5</td>
 </tr>
 </tbody>
</table>


</body>

</html>

The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) improved 1.3% during the last four weeks and 12.9% during the last year. Industrial materials prices overall have risen [...]

FIBER: Industrial Commodity Prices Strengthen

<html>

<head>
<meta http-equiv="Content-Type" content="text/html; charset=windows-1252">
<meta name="GENERATOR" content="Microsoft FrontPage 4.0">
<meta name="ProgId" content="FrontPage.Editor.Document">
<title>U</title>
</head>



 

Wholesale trade inventories increased 0.1% (5.8 y/y) during
April following a 0.2% March gain, revised from 0.3%. The April rise matched the
increase reported in the advance report released on May 30 and compared to no
change expected in the Informa Global Markets Survey.
Durable goods inventories increased 0.2% (6.2% y/y) in April
following a 0.7% rise in March. The 6.2% y/y gain compared to moderate inventory
decumulation early in 2016. Electrical product inventories increased 0.2% (7.8%
y/y) after two months of 1.0% gain while machinery inventories held steady (5.4%
y/y) following a 0.2% rise. Computer equipment inventories increased 0.9% (-1.0%
y/y) after a 2.2% decline. Inventories of nondurable goods were unchanged (5.2%
y/y) following a 0.6% decline. A 0.8% increase (-0.9% y/y) in inventories of
grocery products reversed a 0.9% fall. Apparel inventories were off 0.6% (-1.1%
y/y) after a 0.4% decline. Petroleum inventories surged 3.1% (7.3% y/y) with
higher prices while inventories of paper products declined 1.3% (+4.6% y/y), and
reversed two months of increase.
Sales at the wholesale level gained 0.8% (7.8% y/y) during
April following a 0.4% March increase which was strengthened from last month's
report. Revised data indicate strong growth through last year. A 0.4% April rise
had been expected in the Action Economics Forecast Survey.
Durable goods sales increased 0.8% (7.8% y/y) after a 0.4%
increase. Motor vehicle sales declined 0.7% (+6.2% y/y) after two months of
strong rise. Electrical product sales fell 1.5% (+6.1% y/y), following a 0.8%
rise. Machinery sales surged 1.9% (12.4% y/y) after a 0.1% dip, and furniture
sales jumped 1.6% (2.3% y/y) following a 1.9% fall. Nondurable product sales
strengthened 0.7% (7.5% y/y) after a 0.8% rise. Petroleum product sales gained
1.5% (22.5% y/y) after a 1.0% gain. Apparel sales fell 2.9% (+4.1% y/y) after
holding steady, but chemical product sales surged 2.0% (12.7 y/y) after a 1.2%
fall.
The inventory-to-sales ratio at the wholesale level eased to
1.28 in April after three months at 1.29. It remained well below its most recent
high of 1.38 in February 2016.
The I/S ratio for durable goods eased to 1.59 from 1.60. It
remains well below its most recent peak of 1.74 in January 2016. The furniture
I/S fell sharply to 1.86 from a recent high of 1.92. The machinery and equipment
I/S ratio also plummeted to a six year low of 2.57, well below the 3.02 high in
early-2016. The I/S ratio for nondurable goods declined to 0.98 from 0.99. It
was below the 1.09 ratio two years ago. The petroleum industry I/S ratio rose
slightly m/m but remained near its lowest level since 2014, down from the 0.63
high in early 2016. The I/S ratio in the chemical industry was similarly
depressed and the apparel industry ratio has been steady near 2.10 for two years.
The wholesale trade figures are available in Haver's USECON
database. The expectations figure for inventories is contained in the MMSAMER
database. Expectations for sales are from the Action Economics Database.

 <thead>
 <tr>
 <th class="firstcol" scope="col" width="958">Wholesale Sector - NAICS
 Classification (%)</th>
 <th scope="col" width="129">Apr</th>
 <th scope="col" width="130">Mar</th>
 <th scope="col" width="130">Feb</th>
 <th scope="col" width="130">Y/Y</th>
 <th scope="col" width="130">2017</th>
 <th scope="col" width="130">2016</th>
 <th scope="col" width="130">2015</th>
 </tr>
 </thead>
 
 <tr class="odd">
 <td class="firstcol" width="958">Inventories</td>
 <td align="center" width="129">0.1</td>
 <td align="center" width="130">0.2</td>
 <td align="center" width="130">0.8</td>
 <td align="center" width="130">5.8</td>
 <td align="center" width="130">3.6</td>
 <td align="center" width="130">2.2</td>
 <td align="center" width="130">1.3</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="958">Sales</td>
 <td align="center" width="129">0.8</td>
 <td align="center" width="130">0.4</td>
 <td align="center" width="130">0.9</td>
 <td align="center" width="130">7.8</td>
 <td align="center" width="130">7.4</td>
 <td align="center" width="130">-1.3</td>
 <td align="center" width="130">-4.92</td>
 </tr>
 
 <tr class="odd">
 <td class="firstcol" width="958">I/S Ratio</td>
 <td align="center" width="129">1.28</td>
 <td align="center" width="130">1.29</td>
 <td align="center" width="130">1.29</td>
 <td align="center" width="130">1.30 (Apr.'17)</td>
 <td align="center" width="130">1.29</td>
 <td align="center" width="130">1.35</td>
 <td align="center" width="130">1.33</td>
 </tr>
 


&nbsp;
U.S. Home Affordability Continues to Fall 
by <a href="http://haver.com/comment/Moeller.html">Tom Moeller</a>&nbsp;
June 8, 2018
The National Association of Realtors reported that the
Composite Index of Home Affordability declined 8.8% y/y during April to 145.8,
the lowest level since October 2008. The index was 32.0% below its peak in
January 2013. During the last ten years, there has been a 60% correlation
between the affordability index level and the y/y change in existing
single-family home
sales.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Higher prices have reduced affordability. The median sales
price of an existing home strengthened 5.5% y/y to $259,900. The price rise was
accompanied by a higher average mortgage rate of 4.66%, up from a 3.43% in
December 2012. Together, principal &amp; interest payments rose to $1,073 or 17.1%
of median income, the highest percentage since August 2007. That percentage
compared to a low of 11.7% early in 2013. Growth in median family income slowed
to 2.8% y/y from 3.9% during all of 2016.
The Housing Affordability Index equals 100 when median family
income qualifies for an 80% mortgage on a median priced existing single-family
home. A rising index indicates more buyers can afford to enter the home-buying
market. Data on Home Affordability can be found in Haver's REALTOR
database. Interest rate data can be found in the WEEKLY and DAILY
databases.
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" 0801 width="839">Housing Affordability</th>
 <th 0801 align="center" width="146">Apr</th>
 <th 0801 align="center" width="147">Mar</th>
 <th 0801 align="center" width="147">Feb</th>
 <th 0801 align="center" width="147">Apr Y/Y</th>
 <th 0801 align="center" width="147">2017</th>
 <th 0801 align="center" width="147">2016</th>
 <th 0801 align="center" width="147">2015</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" 0801 width="839">Composite Index</td>
 <td 0801 align="center" width="146">145.8</td>
 <td 0801 align="center" width="147">150.0</td>
 <td 0801 align="center" width="147">160.1</td>
 <td 0801 align="center" width="147">-8.8%</td>
 <td 0801 align="center" width="147">158.5</td>
 <td 0801 align="center" width="147">168.2</td>
 <td 0801 align="center" width="147">168.0</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" 0801 width="839">&nbsp; Median Sales Price (Existing
 Single Family Home)</td>
 <td 0801 align="center" width="146">$259,900</td>
 <td 0801 align="center" width="147">$251,500</td>
 <td 0801 align="center" width="147">$242,600</td>
 <td 0801 align="center" width="147">5.5%</td>
 <td 0801 align="center" width="147">$247,508</td>
 <td 0801 align="center" width="147">$233,642</td>
 <td 0801 align="center" width="147">$221,350</td>
 </tr>
 <tr>
 <td class="firstcol" 0801 width="839">&nbsp; Monthly Mortgage Rate&nbsp;&nbsp;</td>
 <td 0801 align="center" width="146">4.66%</td>
 <td 0801 align="center" width="147">4.63%</td>
 <td 0801 align="center" width="147">4.42%</td>
 <td 0801 align="center" width="147">4.11%</td>
 <td 0801 align="center" width="147">4.20%</td>
 <td 0801 align="center" width="147">3.88%</td>
 <td 0801 align="center" width="147">4.03%</td>
 </tr>
 <tr>
 <td class="firstcol" 0801 width="839">&nbsp; Principal and Interest
 Payment</td>
 <td 0801 align="center" width="146">$1,073</td>
 <td 0801 align="center" width="147">$1,035</td>
 <td 0801 align="center" width="147">$974</td>
 <td 0801 align="center" width="147">12.6%</td>
 <td 0801 align="center" width="147">$967</td>
 <td 0801 align="center" width="147">$880</td>
 <td 0801 align="center" width="147">$849</td>
 </tr>
 <tr>
 <td class="firstcol" 0801 width="839">&nbsp; Median Family Income</td>
 <td 0801 align="center" width="146">$75,093</td>
 <td 0801 align="center" width="147">$74,944</td>
 <td 0801 align="center" width="147">$74,828</td>
 <td 0801 align="center" width="147">2.8%</td>
 <td 0801 align="center" width="147">$73,545</td>
 <td 0801 align="center" width="147">$70,941</td>
 <td 0801 align="center" width="147">$68,267</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" 0801 width="839">&nbsp; Payment as a Percent of
 Income</td>
 <td 0801 align="center" width="146">17.1</td>
 <td 0801 align="center" width="147">16.6</td>
 <td 0801 align="center" width="147">15.6</td>
 <td 0801 align="center" width="147">15.6</td>
 <td 0801 align="center" width="147">15.8</td>
 <td 0801 align="center" width="147">14.9</td>
 <td 0801 align="center" width="147">14.9</td>
 </tr>
 </tbody>
</table>





</html>

Wholesale trade inventories increased 0.1% (5.8 y/y) during April following a 0.2% March gain, revised from 0.3%. The April rise matched the increase reported in the advance report released on May 30 and compared to no change expected [...]

U.S. Wholesale Inventories Inch Higher; Sales Strengthen

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

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

Our global data offering is unparalleled in terms of coverage, quality, and organization. We offer 290+ databases from 2500 government and private sources, a wealth of key survey and forecast data covering the world’s economies, and a robust offering of archive databases that drive machine learning for big data applications.

Optimized for precision analytics, our data is seamlessly integrated with Microsoft Office and all leading statistical packages through our DLX® software and platform independent HaverView™ website. We further offer direct database feeds, client server or cloud-based delivery, and RESTful API.


Privacy Policy

Disclaimer

Contact us

A premier time series data platform for the global strategy, research, and quant communities. 

New York

London

Singapore

Tokyo

Economy in Brief

Viewpoints

Contact Us

Our Data

Our Products

What We Do

Our Authors

About Us

Data News

Resources

Release Calendars

Training Center

Webinars

Newsletters

Download Software

For Clients

Live Updates

Andrew Cates

**The Blue Chip interest rate consensus**
The latest Blue Chip Financial Forecasts survey suggests that monetary policy across most major advanced economies is expected to loosen modestly over the next six months. Central banks in the US, Canada, UK, Australia, and the euro area are all forecast to cut rates to varying degrees, with Australia expected to deliver the largest reduction. In contrast, Japan continues to stand out as the only major economy where forecasters see scope for a slight increase in rates, highlighting its unique position in the global policy cycle. Overall, the chart reflects a broad but uneven tilt towards monetary easing as policymakers respond to softer inflation and growth signals.

250702Z1.jpg

**The US dollar and data surprises** 
This next chart shows that the recent bout of US dollar weakness has coincided with a period in which US economic data surprises have turned more negative relative to the euro area. The surprise index differential between the US and euro area —measuring US growth surprises minus euro surprises—has declined, pointing to a run of weaker-than-expected US data and stronger euro area outturns. Historically, this has tended to pull the euro higher relative to the dollar. However, the scale of the dollar’s recent slide appears larger than the data surprises alone would imply, suggesting that other forces are potentially weighing on the currency as well.

250702Z2.jpg

**US stagflation risk**
Latest ISM manufacturing survey data highlight a worrying decoupling between input costs and underlying demand that points to potential stagflation pressures in the US economy. Historically, the ISM New Orders Index and the Prices Paid Index have tended to move broadly in sync, reflecting cycles where stronger demand drives both production and cost pressures higher. However, the chart shows that while prices paid have recently rebounded sharply, new orders have remained subdued and stuck near contractionary territory. This breakdown suggests that firms are facing rising input costs without a corresponding pickup in demand—an imbalance that could be amplified by US tariff measures, which tend to push up costs for imported materials and components while weighing on new orders through weaker trade flows.

250702Z3.jpg

**US Supply Chain Risks** 
Added to this, the number of vessels queuing at the Los Angeles and Long Beach harbours has climbed to elevated levels in recent weeks, highlighting supply chain bottlenecks on the US West Coast. While various factors may be driving this congestion—including seasonal trade patterns and shifts in global shipping routes—recent tariff measures could be contributing as well. New or increased tariffs sometimes distort normal trade flows by prompting importers to front-load shipments ahead of cost increases or reroute sourcing strategies in ways that strain particular ports.

250702Z4.jpg

**Global warming** 
Pivoting to more structural issues, the next chart highlights the persistent upward trend in global surface temperature anomalies over the past century, with both land and ocean temperatures now averaging well over one degree Celsius. This long-term warming signal continues to manifest in extreme weather events and record-breaking heat waves, including the unusually high temperatures that have swept parts of Europe in recent days, pushing June readings to historic highs in several regions.

250702Z5.jpg

**Climate change and productivity** 
This final chart illustrates the projected impact of heat stress on labour productivity in Europe under current climate policy scenarios, highlighting how rising temperatures could steadily erode worker efficiency over the coming decades. As shown, the median estimates from the Climate Analytics group suggest that productivity losses could deepen from around 0.3 percentage points today to nearly 0.9 percentage points by mid-century if climate conditions remain unchanged. These figures reflect the physical limits of the human body’s capacity to perform work in increasingly hot and humid environments, a challenge that will become more acute if climate change continues on its current path. With recent record-high June temperatures across parts of Europe underscoring the reality of more frequent heat extremes, these projections serve as a clear reminder of the economic stakes involved in addressing climate risks and investing in adaptation measures to protect labour productivity and economic resilience.

250702Z6.jpg

Financial markets have remained generally buoyant in recent days, with global equity indices advancing on the back of relatively upbeat global growth data, benign European inflation readings and the prospect of further policy easing from major central banks. At the same time, the US dollar has continued to weaken, reflecting a run of disappointing US economic data and rising investor concerns about the fiscal outlook, even as European growth surprises have turned more positive. This divergence, combined with the prospect of lower US policy rates relative to some (though not all) peers, has added to the dollar’s drift lower (charts 1 and 2). Supply chain strains—highlighted by elevated vessel queues at US West Coast ports—also feed into the narrative that US tariff measures may be contributing to sticky input costs and stagflation risks (charts 3 and 4). Meanwhile, record temperatures in parts of Europe this week have reinforced the climate challenge facing policymakers, with the final two charts illustrating how rising global temperatures and heat stress could increasingly weigh on productivity and growth potential if left unchecked. With trading volumes light ahead of the July 4th holiday and markets awaiting tomorrow’s US non-farm payrolls report, the interplay between softer US data, resilient equities, a weaker dollar, and climate-related risks remains firmly in focus.

Charts of the Week: Headwinds and Heatwaves

250702J4.jpg

250702K4.jpg

The ADP National Employment Report reported that nonfarm private sector payrolls declined 33,000 (+1.1% y/y) during June after rising 29,000 in May, revised from 37,000 and increasing an unrevised 60,000 in April. It was the first monthly decline since March 2023. A 110,000 June rise had been expected in the in the Action Economics Forecast Survey.

Small business hiring (less than 50 employees) declined 47,000 (+0.4% y/y), after falling 13,000 in May. These were the first back-to-back monthly declines since the end of 2023. Employment at medium-sized firms (50-499,000 employees) declined 15,000 (1.1% y/y), after rising 46,000 in May, revised from 49,000. Large business hiring (500+ employees) increased 30,000 (2.7% y/y) after easing 4,000 in May.

Goods-producing employment rose 32,000 (1.4% y/y) in June after falling a minimally revised 3,000 in May. Manufacturing jobs increased 15,000, unchanged y/y, following a 6,000 decline in May. The number of construction sector jobs rose 9,000 (2.8% y/y) after increasing 6,000 in May. Natural resources & mining jobs rose 8,000 (4.3% y/y) in June after falling 3,000 in May.

The decline in payrolls overall reflected weakness in the service sector where the number of service-producing jobs declined 66,000 last month (+1.1% y/y) after increasing 32,000 in May, revised from 36,000. Professional & business services employment fell 56,000 (+0.2% y/y), after declining 13,000 in May. These weak readings came after a 1,000 April gain and a 46,000 March increase. Education & health services employment declined 52,000 (+0.8% y/y), the third consecutive month of decline. Employment in the financial industry weakened 14,000 (+1.8% y/y) last month, after rising 17,000 in May.

Offsetting these declines, leisure & hospitality employment increased 32,000 in June (3.2% y/y), following a 43,000 May gain. Monthly increases have averaged 36,000 this year. Trade, transportation & utilities employment increased 14,000 (0.3% y/y) after falling 8,000 in May. Information sector employment rose 5,000 (0.2% y/y) after a 4,000 May increase and a 10,000 April decline. Employment in “other” services sectors rose 5,000 in June (2.9% y/y), the same as in May.

Growth in median annual pay for "job stayers" slipped to 4.4% y/y in June, down from a high of 7.8% in September 2022. Manufacturing sector pay grew 4.6% y/y, steady with May. Construction sector pay also rose a steady 4.6% y/y. Natural resource & mining sector pay grew 4.5% y/y last month. Financial sector earnings rose an improved 5.2% y/y, while education & health services pay rose a lessened 4.6% y/y. Leisure & hospitality pay increased 4.7% y/y in June. Professional & business service sector pay increased a lessened 4.2% y/y as did trade, transportation & utilities pay, up 4.2% y/y. Information pay rose a lessened 4.1% y/y. Median annual pay for “job changers” rose 6.8% y/y in June, down from a high of 16.1% y/y in April 2022.

By region, employment in the Midwest declined 24,000 (+1.3% y/y) to 28,761 million after a 17,000 rise in May. Employment in the West, declined 20,000 to 31,363 million (+0.5% y/y) last month, and reversed a 31,000 rise during May. Employment in the Northeast fell 3,000 to 24,116 million (+1.4% y/y) in June, following a 23,000 decline in May. Partially offsetting these declines, in the South employment increased 13,000 to 50,092 million (1.0% y/y) in June, after rising 2,000 in May.

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.

250702L4.jpg

250702M4.jpg

- Employment declines in several service industries; factory & building industry jobs rise.
- Wage growth moderates further.
- Small- & medium-sized shed jobs.

U.S. ADP Payroll Employment Unexpectedly Declines in June

Winnie Tapasanun

250702A13.jpg

250702B13.jpg

Mortgage applications rose 2.7% w/w (24.7% y/y) in the week ending June 27 after a 1.1% rise in the week ending June 20, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. The latest reading was the third w/w rise in four weeks to the index level of 257.5, the highest since the April 11 week. Applications for loans to purchase a house inched up 0.1% (15.7% y/y) in the June 27 week, the first w/w increase in three weeks, following a 0.4% decline in the June 20 week. Applications for loan refinancing advanced 6.5% (39.6% y/y) in the June 27 week, up for the third week in four, after a 3.0% rebound in the previous week.

The effective interest rate on a 30-year fixed-rate loan fell 9bps to 6.97% in the week ending June 27 after rising to 7.06% in the week ending June 20; it was up from a low of 6.29% in the September 20 week but down from a peak of 8.12% in the week of October 20, 2023. The rate on 15-year fixed-rate mortgages declined 6bps to 6.23% in the June 27 week after easing to 6.29% in the previous week; it was up from a low of 5.60% in the September 20 week but down from a high of 7.44% in the week of October 27, 2023. The rate on 30-year jumbo loans dropped 16bps to 6.89% in the June 27 week after rising to 7.05% in the prior week; it was up from a low of 6.57% in the September 13 week but below a high of 7.99% in the week of October 27, 2023. These mentioned three rates were at the lowest since the April 4 week. The rate on a 5-year ARM decreased 15bps to 6.21% in the June 27 week, the lowest since the May 2 week, after rising to 6.36% in the previous week; it was above a low of 5.84% in the September 13 week but below a high of 7.31% in the week of October 27, 2023.

The share of applications for refinancing an existing loan rose to 40.1% of total applications in the week ending June 27 from 38.4% in the week ending June 20, registering the fifth consecutive w/w rise and the highest since the April 11 week; nevertheless, that was well below a peak of 55.7% in the September 20 week. The adjustable-rate mortgage (ARM) share of activity, up for the first week in three, increased to 7.8% in the June 27 week, the highest since the May 2 week, after declining to 6.9% in the prior week; it was up from a low of 4.7% in the January 3 week but below its recent high of 9.6% in the April 11 week and a high of 10.7% in the week of October 27, 2023.

The average size of a mortgage loan, up for the first time in three weeks, rose 3.5% w/w (4.4% y/y) to $391,500 in the June 27 week, the highest level since the May 9 week, after a 0.5% decline to $378,300 in the June 20 week. The average size of a purchase loan recovered 1.7% (2.1% y/y) to $443,500 in the June 27 week, the highest level since the May 16 week, reversing a 0.6% decrease to $436,300 in the prior week. The average size of a loan to refinance a mortgage, up for the third week in four, jumped 10.0% (17.1% y/y) to $313,700 in the June 27 week, the highest level since the May 2 week, on top of a 1.2% rebound to $285,100 in the previous week.

The Mortgage Bankers Association Survey covers 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver’s **SURVEYS** database.

- Purchase applications edge up 0.1% w/w; refinancing loan applications jump 6.5% w/w.
- Effective interest rate on 30-year fixed-rate loans drops to 6.97%, the lowest since the Apr. 4 week.
- Average loan size rebounds to the highest level since the May 9 week.

U.S. Mortgage Applications Rise 2.7% in the June 27 Week

250702E.jpg

The EU unemployment rate fell to within a tick of its all-time low in April at 5.9% and stayed there in May. In the European Monetary Union (EMU), the unemployment rate in April fell from 6.4% in March to 6.2% in April, its all-time low; then in May it ticked up to 6.3%. This can hardly be construed as a weakening of the European labor market.

At the same time, the EMU HICP has registered 2% growth year-over-year in June. In May it was at 1.9% with the core up at a 2.4% rise year-over-year. In June, Italian and Spanish core readings are 2.1% and 2.2%, respectively. In Germany, ex-energy inflation is at 2.5%. The core for the EMU is not yet available but clearly inflation, broadly considered, is very close to touching all the bases the ECB wants it to touch. And at the same time, Europe’s rate of unemployment is at or near all-time lows at least since the EMU was formed. That looks almost like policy nirvana.

The Monetary Union is experiencing low inflation rates even for those countries (largely Mediterranean countries) that had stubbornly high inflation rates in the past. Interestingly, those formerly high-inflation countries have substantially reduced their rates of unemployment. In the U.S., it was the long low, extra-low, inflation span after the Great recession that brought the inflation rate down slowly but eventually to 50–60-year lows. The U.S. rate got to 3.5% under Trump and briefly to 3.4% under Biden. Now with similar inflation progress -and for the EMU, there is a long train of progress not looking just since Covid but looking at the collective progress since the EMU was formed.

Among the 12 EMU members listed in the table, only three Luxembourg, Finland, and Austria have unemployment rates above their median rate compared to data since 1994. Spain’s unemployment rate is still in double digits at 10.8% but is much lower than it used to be. The Greek unemployment rate is at 7.9%; Portugal’s is at 6.3%. Spain’s unemployment rate is in the 15th percentile of its ordered queue of rates; the Greek rate has been lower only 3% of the time; in Portugal, the current rate has been lower less than 20% of the time. Low inflation and low unemployment go hand in hand. But when they diverge, the solution is not to coddle unemployment. It is to backdown inflation to allow the economy to move forward thereafter and prosper with lower inflation and lower unemployment in the future. I don’t think this lesson has been broadly enough learned, but looking at Europe and the U.S. the lesson simply presents itself with exceptional clarity.

250702.jpg

Unemployment Rates Remain Low, Stable

250701F5.jpg

250701G5.jpg

U.S. light vehicle sales dipped 0.5% (+2.4% y/y) to 15.65 million units (SAAR) in June after falling 8.8% to 15.73 million units in May. The retreat in June vehicle sales accompanied a 1.7% y/y rise in real disposable income through May, which compared to 2.1% growth last year.

Sales declines were mixed last month. Light truck sales fell 0.4% (+4.9% y/y) during June to 12.97 million units (SAAR), after falling 8.9% to 13.02 million in May and weakening 1.7% in April to 14.29 million. Purchases of domestically-made light trucks declined 1.8% (+4.6% y/y) to 9.99 million units, after falling 7.5% in May. Sales of imported light trucks rose 4.6% (5.7% y/y) to 2.97 million units, following a 14.5% fall during May.

Trucks’ record 83.0% share of the light vehicle market last month compared to 82.8% in May and 80.8% in June of last year. The share averaged 80.3% during all of 2024 versus 53.3% ten years earlier.

Auto sales rose a slight 0.4% last month, down 8.5% y/y, to 2.69 million units (SAAR) following an 8.8% May decline. Purchases of domestically-produced cars were off 2.5% (-9.2% y/y) last month to 1.98 million units, after declining 8.6% in May. Sales of imported autos rose 9.2% (-6.6% y/y) to 0.71 million units, following a 12.2% May decline.

Imports' 23.5% share of the U.S. light vehicle market was increased from 22.2% in May. It compared to a May 2023 low of 22.9% and a high of 26.3% in November of 2023. Imports' share of the passenger car market rose to 26.4% last month and compared to 25.9% in June of last year. It reached a high of 38.7% in September 2021. Imports' share of the light truck market rose to 22.9% last month after falling to 21.8% in May.

U.S. vehicle sales figures can be found in Haver's **USECON** database. Additional detail by manufacturer is in the **INDUSTRY** database.

250701H5.jpg

250701I5.jpg

- Light truck sales ease while auto sales improve.
- Domestic sales tumble but imports increase.
- Imports' market share recovers May decline.

Economy in Brief: June 2018

Jump to: