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Link to full report and disclosures: Real-Time Insights, Economic and Financial Pulse
Real-Time Insights |
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· Visits to retail and recreation locations in the U.S. continue to trend down according to mobility data from Google, with the seven-day moving average dipping to 9% below the pre-pandemic baseline. While this likely partly reflects elevated gasoline prices that have curtailed driving, could it also signal a broader pull-back in consumer demand? | ||||||||||
· Retail gasoline prices extended their decline with the national average falling to $4.35 per gallon on Sunday, a 10% decline from the start of July. Refiners' margins have also pulled back from record highs with the 321 Gulf Coast crack spread - a gauge of refiner margins - falling to $31 per barrel, almost half the late June peak of $59. Easing fuel prices should alleviate some headline inflation pressures in July. | ||||||||||
· Used vehicle prices continue to defy expectations, rising again in the early weeks of July according to Manheim's used vehicle value index. Prices increased 0.7% through the opening two weeks of July, lifting the yr/yr increase to 13.4%. The stop-start descent of used vehicle prices has accentuated the increase in core inflation, and ongoing constraints on new vehicle production continues to pose some upside risks to used vehicle prices. | ||||||||||
· Global spot container shipping rates continue to recede from their pandemic highs, but remain elevated compared to pre-pandemic levels. Drewry’s World Container Index fell to $6,800 per 40ft container, down from $9,500 at the turn of the year. | ||||||||||
· While the level of initial unemployment claims remains low, they have trended up markedly since late April, with the four-week moving average rising to 240k in mid-July from 170k in mid-April. Continuing claims have ticked up but remain low, as tight labor markets quickly reabsorb laid off workers. | ||||||||||
· Median wages have increased sharply across the income distribution according to data from FRB Atlanta's Wage Growth Tracker. Interestingly, wage growth among middle-high income earners has accelerated in recent months. Does the broadening distribution of wage growth reflect a shift in wage and price setting behavior? | ||||||||||
Week ahead: S&P CoreLogic Case Shiller Home Price Index, New Home Sales (Jul 26); Durable Goods Orders, Pending Home Sales (Jul 27); FOMC July Meeting (Jul 26-27); GDP Q2 (Jul 28); Personal Consumption, PCE Price Index, Employment Cost Index Q2 (Jul 29) | ||||||||||
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Highlighted Charts:
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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