RBC U.S. Consumer Outlook Index Posts Slight Decline
U.S. consumer confidence for February declined slightly for a second month as consumers await a definitive signal on the direction of the economy, according to the monthly RBC Consumer Outlook Index. The Index for February declined to 44.5, down 0.4 points from January’s 44.9 but still above the 42.6 points recorded a year ago. In line with the volatility in the municipal bond market, the survey also found that a majority of Americans are not confident in municipal bonds as an investment. “Although the RBC Consumer Outlook Index has done nothing but move sideways since hitting a post-recession high in December, it’s surprising that consumer confidence didn’t fall even more, given recent events,” said RBC Capital Markets Chief U.S. economist Tom Porcelli. “The survey was conducted in the midst of daily headlines about unrest in Egypt, rising fuel prices and a sharp decline in the markets – all of which historically weigh on confidence. It appears that the Index was backstopped by future expectations, which reached their highest level in a year. This suggests that consumers view current events as transitory and are willing to look past them.”
RBC (Royal Bank of Canada)/Feb 3
Daily Archives: February 3, 2011
STILL WAITING (AND HOPING) FOR A STRONGER LABOR MARKET
You can’t squeeze blood out of a stone and apparently you’ll grow old waiting for initial jobless claims to fall far enough, fast enough to inspire something more than fleeting confidence about the prospects for job creation. Ok, we’re exaggerating, but anyone who’s been watching the labor market these last several years understands the sentiment.
Today’s update on weekly claims for new unemployment benefits sets us up once again for thinking that better days are just around the corner for payrolls. New claims dropped by a hefty 42,000 last week on a seasonally adjusted basis, according to the Labor Department. That’s one of the biggest weekly declines in recent history, but it’s not likely to bring many cheers from the crowd. One reason is that it comes directly after the previous week’s huge gain. Even worse, the progress that was evident for a time in jobless claims late last year seems to have stalled.
IS THE SLUMP IN COMMERCIAL LENDING OVER?
Commercial and industrial loans appear to be on the rise again. For the first time since the Great Recession slammed the economy, lending is increasing, according to Federal Reserve data. Banks are also loosening their lending standards, according to the latest Fed survey. It all adds up to evidence that another variable in the business cycle is no longer creating a drag on the forces of economic recovery. It’s far from a sea change, but even a marginal shift is good news because it adds brings one more critical data point back from the dark side.