Category Archives: Diane Swonk

Investment Remains Dismal

Durable goods orders fell 1.4% in February, after being revised down in January. Losses were driven by a correction in aircraft orders, but still more widespread than hoped. Only 3 of eleven categories posted increases: primary metals, communications equipment and appliances

New Home Sales Buck Trend

New home sales sprang back in February, with a surge in spending on less expensive first-time buyer homes. The bulk of the increases occurred in the $200,000 to $299,000 and the $150,000 to $199,000 range. This marks a sharp shift down in price from earlier in the cycle and suggests builders are finally building less [...]

Inflation Remains Tepid

The consumer price index (CPI) rose 0.2% in February, with a slight uptick in prices at the pump and accelerating rents offsetting a drop in prices elsewhere in the economy. Indeed, overall inflation measures were essentially flat when compared with a year ago. The core (non-food and non-energy) measure of the CPI rose 1.7% from [...]

Question about consumer spending

I received this question via my Twitter account @DianeSwonk: Is it possible that we don’t see an increase in consumer spending due to consumers increasing savings in case the economy goes south? My reply: That is the question the Federal Reserve is asking as well; the argument against it is that consumer confidence is now [...]

Loss of “Patience” Offset by Caution

The Federal Open Market Committee (FOMC) voted unanimously to drop “patience” with regard to its stance on short-term interest rates. The loss of the word “patience” from the statement was more than offset by a surprise in the FOMC’s verbiage that raising rates at the next meeting in April “remains unlikely.” That is in addition [...]

Industrial Production Disappoints

Industrial production edged up a negligible 0.1% in February, carried almost entirely by gains in utilities. Colder than usual temperatures across the country in February boosted utility usage, particularly in places that typically see more temperate conditions, in the South and West. Texas and Virginia were hit particularly hard by cold winter weather and storms [...]

PPI Continues to Cool Down

The Producer Price Index (PPI) for final demand fell 0.5% in February after plummeting 0.8% in January. Moreover, the bulk of those declines (70%) occurred in services as opposed to goods, which had been weighed down by falling oil prices in recent months. The decline in services was dominated by a loss in margins for [...]

Retail Sales Hit by Heavy Snow

Retail sales fell a disappointing 0.6% in February. Snow days were worse in February than in January (particularly in the South and parts of the West that don’t usually have to deal with snow). The drop in retail sales was driven by a sharp decline in vehicle sales; that also happened last year

Momentum Trumps Lousy Weather

Payroll employment increased by 295,000 in February; that was better than expected given the weather disruptions we experienced across the country, which were worse in February than January. Even after a downward revision to the January data, the quality and quantity of jobs was solid in February. The largest gains in payroll employment occurred in [...]

A Primer for February Employment

We expect payroll employment to rise by 210,000 jobs in February, less than we initially expected because unusually harsh winter weather and work stoppages at West Coast ports disrupted everything from construction to manufacturing activity.