Personal consumption spending for September is projected to rise 0.3% vs. the previous month in tomorrow’s delayed update from the government, based on The Capital Spectator’s average econometric forecast. Today’s average projection matches the previously reported 0.3% increase for August. Meanwhile, the Capital Spectator’s average 0.3% forecast for September is at the upper range of several consensus predictions based on surveys of economists.
Daily Archives: November 7, 2013
US Nonfarm Private Payrolls: October 2013 Preview
Private nonfarm payrolls in the US are projected to increase by 133,000 (seasonally adjusted) in tomorrow’s October update from the Labor Department, according to The Capital Spectator’s average econometric point forecast. The projected gain is slightly higher than the reported increase of 126,000 for September. Meanwhile, The Capital Spectator’s average October projection is slightly higher than a pair of consensus forecasts, based on surveys of economists.
Q3 GDP Delivers An Upside Surprise
The US economy picked up speed in the third quarter, or so today’s initial estimate of Q3 GDP shows. The economy expanded by 2.8% in the three months through September vs. the previous quarter, based on a seasonally adjusted annualized real rate. That’s quite a bit better than the consensus forecast of 2.0% and The Capital Spectator’s 2.1% average econometric nowcast. The faster pace of growth in Q3 was driven largely by “a deceleration in imports and accelerations in private inventory investment and in state and local government spending,” according to the Bureau of Economic Analysis. But it’s unclear if this is a sign that the economic growth will continue to improve. For one thing, consumer spending remains tepid, according to today’s report. Still, it’s hard to argue that the economy is slowing via the data du jour. In a separately released report today, new filings for jobless benefits dropped again last week. Overall, today’s news reinforces the message that the economy continues to grow at a moderate pace with minimal signs of distress on the immediate horizon.
Macro-Markets Risk Index: 12.2% | 11.07.2013
The US economic trend has rebounded in early November after slumping during the past two months, according to a markets-based profile of macro conditions. The Macro-Markets Risk Index (MMRI) closed at 12.2% on Wednesday, Nov. 6—a level that suggests that business cycle risk remains low. One interpretation of the benchmark’s revival is that it reflects optimism that the end of last month’s government shutdown removes a weight on the economy. The current 12.2% value is nearly twice as high as the lowest reading for the year to date—7.5% posted in mid-September—and comfortably above the 0% danger zone. If MMRI falls under 0%, that would be a sign that recession risk is elevated. By comparison, readings above 0% imply a bias for economic growth.