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Link to full report and disclosures: Real-Time Insights, Economic and Financial Pulse
Real-Time Insights | |||||||
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· The seven-day moving average of daily COVID-19 cases in China has fallen to just over 3,500 from a peak of 30,000 one month ago, with Chinese authorities now poised to loosen some lockdown restrictions. In Shanghai, beginning Wednesday residents of "low risk" areas will be able to leave their housing compounds while restrictions on public transportation and taxis will be lifted. | |||||||
·China's Manufacturing PMI increased 2.2pts to 49.6 as manufacturing activity contracted in May, but at a slower rate than in April. Easing of COVID-19 pandemic-related restrictions should boost production, particularly in Shanghai, as will a 300 billion yuan stimulus package enacted by the Shanghai government. | |||||||
· Passenger throughput at domestic airports is trending back to pre-pandemic levels reflecting pent up demand for travel. The seven-day moving average of throughput was 2.2m passengers at the end of May, just 200k below its level at this time in 2019. Amid strong demand, airline companies have largely maintained the flexibility to pass on sharp increases in fuel costs - airfares jumped 18.6% m/m in April's CPI. | |||||||
· Respondents to the WSJ's Economic Forecasting Survey administered in April have significantly revised up the probability of a U.S. recession unfolding in the next 12 months relative to the survey administered in January, while the dispersion/variance of respondents' point estimates increased markedly as well. The average surveyed forecaster in April attached a 28% probability to recession relative to 18% in January's survey. | |||||||
· Lumber futures have plummeted through May falling from $1000 per 1000 board ft to a six-month low of $650 early last week before rallying to $700 per 1000 board ft. Mirroring the decline in futures, spot prices have fallen $800, a 12% decline in the last week. To what extent might slowing demand from homebuilders amid rising rates further weigh on lumber prices? | |||||||
· Total job postings on Indeed continued to trend down through April and May, which is likely to be reflected in JOLTS data on job openings as of the end of April released Wednesday. Job postings in the hospitality and tourism sector are just 19% above their pre-pandemic level, while those for food preparation and service are 42% above their February 2020 level. To what extent might the gap between postings in the two sectors reflect a decline in international tourists entering the U.S.? | |||||||
Week ahead: S&P CoreLogic Case-Shiller Home Price Index (May 31); ISM Manufacturing, JOLTS Report, Beige Book, Wards Vehicle Sales (June 1); Employment Report, ISM Services (June 3) | |||||||
Link to full report and disclosures: Real-Time Insights, Economic and Financial Pulse
Mickey Levy, [email protected]
Mahmoud Abu Ghzalah, [email protected]
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