Friday, July 19, 2024

Preliminary indications that US growth continues

There are several regional Federal Reserve Bank surveys, which correlate well with overall economic activity, though they are "spiky" and need to be smoothed.   The average of the Philadelphia Fed and the NY Fed surveys only covers the NE of the United States, but it correlates remarkably well with the overall national ISM (Institute of Supply Management) survey (for which July data won't be available for another 2 weeks.) 

After a weather-related slump in January, the average has recovered strongly, suggesting that the same will happen to the ISM in July, and that the economy continues to pick up.  Of course, there have been other indicators which suggest it's slowing down, in particular in services, where it looks as if the Covid "revenge spending" splurge is over.   I expect a sustained but slow recovery over the next few months.




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