A week has passed since we learned that the growth rate for US payrolls in March suffered a dramatic slowdown for the monthly comparison. The annual pace is still robust, but that didn’t stop some pundits from announcing that the macro apocalypse has arrived. But the incoming numbers for this week beg to differ. Reading all the key reports since Monday implies that the weak March profile for the labor market represents a temporary stumble rather than an early warning of deeper trouble ahead. In short, the outlook for moderate economic growth remains a compelling forecast until the data says otherwise.
Maybe next week’s numbers will tell a different story, but the dominant message is convincingly upbeat via the latest releases overall. Judge for yourself, based on the key economic reports for Apr. 6-9:
● US jobless claims remain near a 15-year low for the week through Apr. 4.
● Bloomberg’s Consumer Comfort Index increased last week to the highest level since 2007, reflecting an improvement in consumer confidence.
● US consumer spending ticked higher in March vs. the previous month, according to Gallup’s survey data.
● Markit’s US Services PMI in March posted its “sharpest increase” since last summer. The PMI data also reflected the “strongest upturn in payroll numbers since June 2014.” The ISM Non-Manufacturing Index for March also delivered upbeat news for the US services sector last month, including a slightly faster pace of growth for payrolls.
● The public “continues to hold a roughly even mix of positive and negative views about the economy,” according to the March update of Gallup’s US Economic Confidence Index.
● Chain-store sales in the US increased 1.3% in March from the comparable period in February, based on the Redbook Research data. In last month’s final week, sales jumped 3.4% from a year earlier — a moderate improvement over the previous 3.0% increase.
● US job openings increased to a 14-year high at the end of February, according to the Labor Department’s latest JOLTS update (job openings and labor turnover survey).
● Consumer credit in Feb. advanced 5.6% (seasonally adjusted annual rate), according to the Federal Reserve — the fastest pace of growth since October.
● Mortgage applications for new home purchases increased by 17% in March vs. the previous month, the Mortgage Bankers Association reported. Meanwhile, mortgage applications increased 0.4% for the week through April 3, 2015 vs. the previous week.