NationalEconomicTrends October Monetary Policy Stance: The View from Consumption Spending The Federal Reserve has set the target range for the federal funds at to 5 percent and intends to keep this near zero for an extended period According to the policy statement issued after the September Federal Open Market Committee (FOMC) meeting, the Committee will maintain this range and continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds for an extended period Generally, policymakers try to lean against the wind that is, they keep the federal funds below a neutral interest when the economy is weak and above it when the economy is strong There is no clear consensus about the appropriate definition of a neutral interest to be used to evaluate whether monetary policy is easy or tight One method is to look at long-term interest s Another, used here, is to appeal to economic theory to gain from observations on consumption spending Models in economics and finance relate consumption growth to the interest In the basic models, this is an asset pricing relationship that depends on the average household s discount factor (a measure of their preference for consuming today rather than tomorrow) and degree of risk aversion In calculating the implied market interest, we choose a discount factor and degree of risk aversion so that the series for the neutral interest would be, on average, equal to the real federal funds since 1 For the period since 15, with Percent these assumptions the neutral is only 7 basis points below the average real federal 5 funds The chart shows the real effective federal funds and the neutral interest implied by the consumption-based asset pricing formula The federal funds is adjusted for inflation 1 using the chain price index for personal consumption expenditures 1 Different assumptions 1 about the discount factor and people s aversion to risk would shift the average level of the implied market up or down, but would have only a minor effect on the cyclical pattern of the difference between the series According to this standard for measuring the stance of policy, monetary policy was relatively tight during the late 1s through 11 Policy was easy from mid-1 until early 1 and then, except for a brief period following the Russian bond default, relatively tight through 1 Policy was very easy from through 5 To see the stance of policy going forward, the series on the chart are extended to the end of 1 using forecasts of inflation and consumption growth from the Federal Reserve Bank of Philadelphia s Survey of Professional Forecasters (SPF) and assuming that the extended period for the current Fed forecast goes to the end of 1 If the forecast is accu, consumption growth and the implied should both increase and become positive over the next quarters With a positive inflation forecast and the FOMC promise to keep the federal funds target near zero for an extended period, we should expect a third business cycle in succession in which the real federal funds reaches its trough well after the economy begins to recover William T Gavin 1 The data on the real federal funds and our measure of the neutral interest are quite volatile from one period to the next Therefore, we smooth the data by taking a centered 5-quarter moving average for both variables By centering the moving average, we smooth the series without distorting the timing of the peaks and troughs 1 1 1 1 1 1 1 Views expressed do not necessarily reflect official positions of the Federal Reserve System researchstlouisfedorg Neutral Interest Rate Real Federal Funds Rate NOTE: Shaded area averages include data from SPF forecasts through 1
Contents Page Economy at a Glance Output and Growth 7 Interest Rates Inflation and Prices 1 Labor Markets 1 Consumer Spending 1 Investment Spending 1 Government Revenues, Spending, and Debt 1 International Trade Productivity and Profits Quick Reference Tables 7 Notes and Sources Conventions used in this publication: 1 Except where otherwise noted, solid shading indicates recessions, as determined by the National Bureau of Economic Research The NBER has not yet determined the end of the recession that began in December 7; however, the hatched shading shows that the recession ended in July We made this determination based on a statistical model for dating business cycle turning points developed by Marcelle Chauvet and Jeremy Piger ( A Comparison of the Real-Time Performance of Business Cycle Dating Methods, Journal of Business and Economic Statistics,,, -) For more information, see http://wwwuoregonedu/~jpiger/us_recession_probshtm refers to simple percent changes from year refers to the percent change from the same month or quarter during the previous year Compounded annual of change shows what the growth would be over an entire year if the same simple percent change continued for four quarters or twelve months The compounded annual of change of x between the previous quarter t 1 and the current quarter t is: [(x t /x t 1 ) 1] 1 For monthly data replace with 1 All data with significant seasonal patterns are adjusted accordingly, unless labeled NSA We welcome your comments addressed to: Editor, National Economic Trends PO Box St Louis, MO 1- or to: stlsfred@stlsfrborg National Economic Trends is published by the of the Visit the s website at researchstlouisfedorg/publications/net to download the current version of this publication or register for e-mail notification updates For more information on data in this publication, please visit researchstlouisfedorg/fred or call (1) -57
updated through 1// National Economic Trends Real GDP Growth Compounded annual s of change - - - 7 1 1717 175 17 1 Consumer Price 1 1 - - -1-1 - 7 1 1717 175 17 1 Industrial Production Interest Rates Percent 1-1 - - - 5 1 -Month Treasury 1- Treasury -5 7 1 1717 175 17 1 7 1 1717 175 17 1 Change in Nonfarm Payrolls Thousands Unemployment Rate Percent of labor force 1-7 - - 5-7 1 1717 175 17 1 7 1 1717 175 17 1
National Economic Trends updated through 1// Real Gross Domestic Product from year 1 5-5 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Industrial Production and Institute for Supply Management (ISM) es from year 1 1 Industrial Production 7 5 - -1-1 ISM 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 5 Aggregate Private Nonfarm Hours from year 1 - - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Real Change in Private Inventories Percent of GDP 1-1 - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1
updated through 1// Real Final Sales and GDP Compounded annual s of change Final Sales - - - GDP (bar) - 7 1717 175 17 1 Real GDP Revisions National Economic Trends Compounded annual s of change Advance Preliminary Final Comprehensive Revision - - - - : : :1 : : Industrial Production and ISM 1-1 5 5 Nominal Gross Domestic Product Compounded annual s of change - - - Industrial Production (bar) ISM - - -5 7 1717 175 17 1-7 1717 175 17 1 Aggregate Private Nonfarm Hours 75 5 5-5 -5-75 -1-15 7 1717 175 17 1 Average Weekly Private Nonfarm Hours Hours 75 5 5 75 1717 7 175 17 1 Real Change in Private Inventories Billions of dollars - - - -1-15 -1 7 1717 175 17 1 Inventory-Sales Ratio Manufacturing and trade 15 1 1 1 1 1 1 1 7 1717 175 17 1 5
National Economic Trends updated through 1// Contribution of Components to Real GDP Growth Percentage points at compounded annual s - - - -1-15 7Q Q1 Q Q Q Q1 Q Q Consumption Exports Government Imports Inventories Investment Contributions to Real GDP Growth Rate 7 th 1st nd rd th 1st nd rd Final Sales 75-51 71 - -7-7 5 Consumption - - -15 - Fixed Investment - - -1-1 - - -1 Nonresidential 7 5 1-7 -7-5 -11 - Residential -1-1 - -57-1 -1-7 5 Government 1 51 71 5-5 1 Federal 1 5 55-5 State and Local 1-5 15 1-5 -1-1 Net Exports 5-1 5 15-5 Exports 15-17 - -7-5 -5 1 Imports 1 5-1 Change in Inventory - -1-15 - - -1 Residual -1 1 7 - - Real GDP Growth 1-7 1 - -57 - -7 5
updated through 1// National Economic Trends Interest Rates Percent 1 15 1 1- Treasury -Month Treasury 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Treasury Yield Curve Percent 5 5 5 15 Sep Week Ending: 1// 1 5 Sep m 1y y 5y 7y 1y Standard and Poor's 5 with Reinvested Dividends from year 75 5 5-5 -5 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 7
National Economic Trends updated through 1// NIPA Chain Price es from year GDP Gross Domestic Purchases - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Consumer Price from year Excl Food and Energy All Items - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Producer Price, Finished Goods from year 1 Excl Food and Energy - PPI - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Employment Cost and Compensation per Hour from year 1 Comp per Hour ECI 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1
updated through 1// NIPA Chain Price es Compounded annual s of change - - Gross Domestic Purchases GDP (bar) - 7 1717 175 17 1 Consumer Price Compounded annual s of change 15 1 5-5 -1-15 CPI (bar) Excl Food & Energy - 7 1717 175 17 1 Compounded annual s of change 1 PCE (bar) National Economic Trends Oil & Natural Gas Prices: Spot & Futures Dollars per barrel 15 1 1 Oil Futures 1 Spot Gas 1 Gas Futures 5 7 1 5 7 1 11 Note: Futures prices as of // Consumption Chain Price 5-5 -1 Spot Oil Excl Food & Energy Dollars per million btu -15 7 1717 175 17 1 Producer Price, Finished Goods Compounded annual s of change PPI (bar) 1 Unit Labor Cost Compounded annual s of change 1 Manufacturing (bar) 1-1 - Excl Food & Energy - Nonfarm - 7 1717 175 17 1-1 7 1717 175 17 1 Employment Cost from year Benefits Compensation per Hour Compounded annual s of change Compensation Wages and Salaries - 5 7 171 17 1 1717 175 17 1-7 1717 175 17 1
National Economic Trends updated through 1// Employment from year Payroll Survey Household Survey - - - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Unemployment, Labor Force Participation, and Employment Rates Percent of labor force 15 1 Labor Force/Population Employment/Population Percent of population 7 7 1 Unemployment Rate 5 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 55 Duration of Unemployment Percent of labor force 55 5 75 Weeks 1 1 1 5 15 75 Unemployed > 15 Weeks Median Unemployed < 5 Weeks 1 1 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 1
updated through 1// National Economic Trends Change in Nonfarm Payrolls Thousands Change in Manufacturing Payrolls Thousands 5 - - - -5-1 -15 - -5-7 1717 175 17 1-7 1717 175 17 1 Change in Household Employment Thousands Labor Force and Population from year 15 Pop - - - -1 % Confidence 1 5 Labor Force -15-1 7 1717 175 17 1-5 5 7 171 17 1 1717 175 17 1 Available Labor Supply and Components Percent of labor force 1 1 1 Available Labor Supply Unemployed Want to Work 5 7 171 17 1 1717 175 17 1 Unemployment Rate & Job Openings Rate Percent 1 11 1 7 5 Job Openings Rate Unemployment Rate Percent 1 5 7 1 171 17 1 1717 175 17 1 1 % Confidence 7 5 11
National Economic Trends updated through 1// Real Disposable Personal Income from year, quarterly data 1-5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Real Consumption from year, quarterly data 1 Durables from year, quarterly data 1 Total - - -1 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 - Retail and Food Services Sales from year, quarterly average 1 1 - - -1 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 *Data from Jan 1 to the present are on a NAICS basis; data prior to Jan 1 are on an SIC basis and are not strictly comparable (see End Note) Debt Service Payments and Household Debt Outstanding from year, quarterly data 1 Percent of disposable personal income 15 15 1 - Debt Service Payments Household Debt Outstanding 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 1 1 1 11 1 1
updated through 1// Real Disposable Personal Income Personal Saving Rate Percent National Economic Trends - - 7 1717 175 17 1 5 7 171 17 1 1717 175 17 1 Real Consumption Compounded annual s of change 5 15-15 - -5 7 1717 175 17 1 Real Consumption 1 - - - 7 1717 175 17 1 Retail & Food Services 1-1 - - Total (bar) Ex Autos - 7 1717 175 17 1 Real Durables Consumption & Vehicle Sales Millions of vehicles, annual Autos and Light Trucks 1 - - Durables (bar) - 7 1717 175 17 1 1 1 1 1 Consumer Sentiment (U of Michigan) 11 1 7 5 5 7 171 17 1 1717 175 17 1 Real Durables Consumption Compounded annual s of change 5 15 75-75 -15-5 - 7 1717 175 17 1 1
National Economic Trends updated through 1// Investment Percent of nominal GDP Total 1 1 1 Private 1 1 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Private Fixed Investment from year 1 Nominal 1 Real - -1-1 - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Real Nonresidential Fixed and Equipment & Software Investment from year 1 1 - -1-1 Equipment & Software Nonresidential - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Real Residential Fixed Investment from year - - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 1
updated through 1// National Economic Trends Gross Saving Rates and Balance on Current Account (NIPA) Percent of GDP 5 15 1 5-5 -1 Gross Private Saving Gross Govt Saving BOCA 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Real Private Fixed Investment Compounded annual s of change 1 Nondefense Capital Goods Orders from year, excluding aircraft -1 - - 1-1 - Equipment & Software Investment Orders - 7 1717 175 17 1-5 7 171 17 1 1717 175 17 1 Real Equipment & Software Investment Compounded annual s of change 1-1 - - - 7 1717 175 17 1 Real Nonresidential Fixed Investment Compounded annual s of change 1-1 - - - -5 7 1717 175 17 1 Real Residential Fixed Investment Compounded annual s of change Housing Starts and New Home Sales Millions, annual Millions, annual 1 1 1 1 New Home Sales -1 - - 1 Housing Starts 5-7 1717 175 17 1 7 1717 175 17 1 15
National Economic Trends updated through 1// Govt Consumption and Investment Billions of dollars 7 Govt Current Receipts and Expenditures Percent of GDP Total Expenditures 1 Total 1 15 State & Local 7 Total Receipts 1 Fed Expenditures Federal 1 Fed Receipts 15 1 1 Government Budgets Billions of dollars National Income Accounts Calendar s Unified Budget Fiscal s Receipts State and Local Federal Federal Expenditures Surplus or Deficit (-) Receipts Expenditures Surplus or Deficit (-) Receipts Outlays Surplus or Deficit (-) 1 151 11 15 177-1 15 15-17 17 15 1 15 171-1 157 11-1 1 115 1117 1777 17 17 157 1 1 11 1 15 17 17 17 15 1 11 1 571 171 15 55 17 1 17 1-15 17 5 11 1 1 117 1-51 15 111-5 15 11-157 1 1551-151 15-7 175 11-77 11 1-1 -75 1-17 5 17 175 5 1 571-15 7-1 17 177 511 55 7-7 55-7 17 15 17 7-5 7-17 17 1-75 117-5 -5 7Q 151 15-1 7-5 71-1 Q1 17 1-1 57-5 5 757-5 Q 1 1-5 71 1-7 77 71 Q 175 5-5 5 155-57 5 75-1 Q 151 75-51 7 11-71 57 7-5 Q1 11 1-51 - 1 - Q 1 1-11 55-15 5 7 - Q 57 515-1
updated through 1// Federal Debt Percent of GDP 7 Total Percent of GDP National Economic Trends Federal Surplus (+) / Deficit (-) 5 - NIPA Held by Public - - Unified Budget - 1 Change in Federal Debt Percent of GDP 1 NIPA: Net government saving Federal Surplus (+) / Deficit (-), Unified Basis Billions of dollars, fiscal years 1 - Held by Public Total 5-5 -1 Excl interest payments Total - -15 1 1 Federal Government Debt Billions of dollars, end of month or fiscal year Excludes Agency-issued debt Total Public Debt Held by Agencies and Trusts Held by Public Federal Total Reserve Banks Held by Private Investors Foreign and Total International 57 7 7 7 7 77 5 5 77 7 7 17 15 51 7 5 1 March 71 7 755 11 5 June 775 7 17 September 57 7 7 7 December 77 1 77 11 15 7 March 7 75 55 7 71 17 June 77 7 75 15 1 September 77 5 5 77 7 7 December 51 7 57 5 March 7 1 5 51 7 575 June 7 55 7 5 September 17 15 51 7 5 1 December 1 7 77 75 5 77 March 111 17 7 June 1155 7175 55 515 17
National Economic Trends updated through 1// Current Account, Trade and Investment Income Balances Billions of dollars, quarterly - - - - -1-1 -1-1 -1 - Current Account Investment Income Goods and Services Percent of GDP - - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 - - - - -1-1 -1-1 -1 Exchange Rates, March 17 = 1 1 Yen/US$ 1 x (Ecu or Euro/US$) 75 1 1 5 1 Yen Major Currency 15 Euro Ecu 75 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Goods Export Shares, Goods Import Shares, UK % Mexico 11% UK 77% Mexico 1% China 155% All Other 71% China 5% Japan 51% Germany 7% All Other 71% Japan 5% Germany % France % Other OECD 177% Canada 5% France % Other OECD 1% Canada 1% 1
updated through 1// Trade Balance Billions of dollars -1 Goods Trade from year Exports National Economic Trends - - Goods and Services 1 Imports - -1 - - -7 Goods - 7 1717 175 17 1 - - 7 1717 175 17 1 Current Account Balance Billions of dollars Services Trade from year - - -1-1 - 1-1 Exports Imports - 7 1717 175 17 1-7 1717 175 17 1 Real GDP Growth of Major Trading Partners Compounded annual s of change United Kingdom 1 Germany - - - -1-1 7 7 1-1 7 7 1 - - - Canada 7 7 1 - - - France 7 7 1 - - -1-1 Japan 7 7 1 Mexico 1 - -1-1 - 7 7 1 1
National Economic Trends updated through 1// Output per Hour and Capacity Utilization, Manufacturing from year 15 1 Utilization Rate (level) Percent 5 7 Output/Hour -5 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 *Data from 17 to the present are on a NAICS basis; data prior to 17 are on an SIC basis and are not strictly comparable (see End Note) 5 Nonfarm Compensation per Hour from year 15 1 Nominal 5 Real -5 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 Output per Hour, Nonfarm Business and Nonfinancial Corporations from year Nonfinancial Corporations Nonfarm Business Sector - 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1
updated through 1// National Economic Trends Nonfarm Output per Hour Compounded annual s of change Manufacturing Output per Hour Compounded annual s of change - - - 7 1717 175 17 1-7 1717 175 17 1 Selected Component Shares of National Income Percent 15 Percent 75 1 11 Corpo Profits 7 71 7 Proprietors' Income 7 5 1 Compensation 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 5 1 Corpo Profits Percent of GDP 1 1 1 Profits (Before Tax) Profits (After Tax) 5 7 1 5 7 1 5 7 5 7 1 5 7 1 5 7 1 1
National Economic Trends updated through 1// Billions of $ Nominal GDP Billions of $ Real GDP Billions of $ Final Sales Change in Private Inventories Billions of $ Last qtr / 5 1 5 175 1 15 5 1 17 7 1175 5 7 177 51 155 1 1 5 1 11 111 1117-5 1 115 5 115 5 1511 5 51 5 17 51 1 1 17 1 5 75 577 15 5 151 1 1 1 751 717 1115 5 17 177 1 15 5 7 1 175 55 11 1 1 1 1 1 1 5 17 177 1 1175 7 7 117 5 5 111 7 1 77 17 5 5 11 1 5 111 7 11 17 1 17 1 15-7 1-5 1 1 1 17 5 115 15 1 155 7 1-71 1 157 1 1-7 1551-5 -7-1 17-5 1 111-5 -1 117-7 -1-7 -5 1 117 - -1 151 - - 1557-1 - -11-551 1151 - - 115-7 - 1777 7 - -115-5 115-17 11 5-11 -15-1771 -1155 Billions of $ Consumption Durables Consumption Billions of $ Private Fixed Investment Billions of $ Nonresidential Fixed Investment Billions of $ 5 1 115 5 175 5 175 7 75 1151 1 1711 15 7 7 1 11 17-1 15-111 -5 1-51 1557 1 1 5 5 1 1177 17 5 1 5 5 11 1 7 57 11-1 1-1 5 157 7 711 5 5 1151 5 11-5 15 7 1117 1 1171 5 175-5 - 17517 7 7 1 515 7 1 11 55 111 - -7 117 5 1 11 11 1 177-1577 11 55 55 1 7 1 5 15557 - -1 155 555 1 1117 55 11 - - 1511 7 7 1 55-111 - 711 - -1 15 1 7 57 1 11757-57 -1 7-7 - 1 1 77-5 -7 115-117 -5 7 - -5 157-1 157-1 -1 1775 - -11 1 - - 17-15 - 1 1-15 171-17 - -1 111 - -17 1 - -17 1717-5 - 111-15 -1 155 - -17 51-11715 -11 111-1 111-5 -1
updated through 1// National Economic Trends GDP Chain Price Employment Cost ECI: Wages ECI: Benefits 5 1 1 5 1 11 11 11 7 11 15 1 155 15 11 1 1 17 17 1 171 1 1 5 1 1 11 11 11 17 1 15 15 1 15 17 1 1 1 1 1 1 7 1 157 1 7 1 5 11-1 1 7 1 1 1 15 7 1 1 1 15 1 15 5 1 7 177 7 15 5 1 17 1 15 1 17577 1 1 17 7 1 17 15 11 1 1 17 1 1 15 11 5 1 11 175 5 1155 1 1 11 1 1 1 7 17 15 1 1 11 1 1 1 7 1 7 11 7 15 15-15 15 7 15 11 7 15 1 7 1 17 7 Billions of $ Exports Billions of $ Imports Nonfarm Output per Hour Nonfarm Compensation per Hour 5 1557 7 77 1 1 17 17 1 151 1 175 15 7 151 7 17 1 1 171 1 5 15-111 1 15 1 177 15 115 7 5 1757 1 171 55 1 117 1 5 177 15 17 1 11 5 175 7 171-1 157 1 17171 17 1 11-5 1 17 17 1 5 7 1 151 5 7 17 1 1 5 177 7 1575 5 115-5 117 11 1751 15 15 11 7 17 117 55 17 7 11 15 1 17-1171 177 5 1 1-1 17-5 - 1177-1 5 17 17 171 11 11 17-5 -1 1 1 171 1 7 1551-5 1 - - 17-1 1 11 5 1 151-15 - 1-17 - 1 117 1 15 - -11 11 - -1 1 1 11-7 115-1 -15 17-17 -15 155 1 115 7 1 17-11 117 1-1
National Economic Trends updated through 1// Household Survey Employment Thousands Change Nonfarm Payroll Employment Thousands Change Nonfarm Aggregate Hours Monthly 1 1511 11 111 1 11 1 1 5 1171 7 1 1 17 17 1 77 1 1 1 15 7 15 1 11 17 157 11 17 1 15-1 -5 17-55 - 1-1 7 1 11 5 1 1 175 15 1 1 1 157 - - 1 17557 1 17 1 15 15 1 1755 1 1 17 1 175 1 1 177 15 1 1 11-17 - 17-57 - 5 175-1 -5 7 15-1 - 1 175 - -1-1 - - - 15 - -1-5 17-55 -15-11 -7 - -11 1-15 - -15 1577-177 -7-1 11-1 -7-1 1157 - -7-1 1-5 -5-1 117 - - -5 151-7 - -7 115-157 -5-7 - -7-151 -17 - - 111-5 - - - - - 7 Sep 1 71 1 175 1 17 1 11 1 Oct 157 - -7 1717 15 1 1 175 1 Nov 15 7 7 1 15 1 177 11 Dec 1-71 - 115 1 1 17 1 11 7 Jan 117 1-7 - 7 175 - - Feb 175 - - 1 17-1 -1 5 17 1 11 Mar 1-5 - - 171-1 -11 175-1 -11 Apr 157 1 175-1 -1 17-1 -11 5 May 157 - - 17517-17 -1-1 1-5 -5-5 Jun 157 - -1-175 -11-1 - 1-5 -55-1 Jul 155-1 -1-17 -1-11 - 1 - - -1 Aug 157 - - - 175-175 -15-1 -7 Sep 15 - - - 17-1 - -7 15 - - -1 Oct 157-7 - - 15 - - -11 15 - -7 - Nov 11-51 - -17 15755-57 -51-1 11 - - - Dec 1 - -5-157 -1-5 - 1 - - - Jan 1-1 - - 1-71 - -7 15-7 -7-7 Feb 117-51 - - 15-1 -5-1 11 - - -5 Mar 17-1 -71-5 1-5 -57-5 17-1 -1 - Apr 117 1 1-11 -51 - - 11 - - - May 157-7 -7-7 117 - -7 - - -5 - Jun 11-7 -1-11715 - -1-1 1-7 -1 - Jul 11-155 -1-1111 - -7-1 1 - Aug 1 - - - 111-1 -1 - - - -7 Sep 1-75 -5-17 - - - 5-5 -5 -
updated through 1/1/ National Economic Trends Unempl Rate Retail and Food Services Sales Billions of dollars Monthly/ quarterly Industrial Production Monthly/ quarterly Treasury Yields (Percent) -mo 1-yr 55 1 1 5 17 7 5 51 7 17 15 7 5 17 7 7 7 5 1111 15 5 5-7 115-17 7 7 1 5 15 1 5 11 5 1 1 5 1111 5 11117 1 7 5 7 11 1 1117 5 1 1 7 11 1115 1 1 117-5 - 111 1 5 117 1 1171-1 - - 1 1 1111-1 - 11 - - - 1 11 - - - 1 - -1-7 5 1 1 1-1 -55-7 -51-1 -11 1 7 111 - -1-5 -7-1 -1 17 1 17 1-75 1 5-7 1 5 7 Sep 7 7 1 1 1171 1 5 Oct 7 5 5 1111-5 -1 15 5 Nov 7 777 1 5 1151 71 7 15 Dec 7 - -11 11 7 17 1 Jan 7 - -5 11-1 - 75 7 Feb 71 - -5 115 - -1 11 1 7 Mar 51 75 5 5 1 1115 - -1 1 51 Apr 5 7 1111 - -7-1 May 55 7 1 1 11 - - - 17 Jun 5 755 - -1 7 11 - -5-7 1 1 Jul 5 71-5 -1 17 117-1 - -1 1 1 Aug 7111-7 - 1157-11 -15-17 Sep 5-1 -175-1 17 - - - 11 Oct 557 - - -5 11 1 1-7 7 1 Nov 777-1 -1-177 -1-17 -5 1 5 Dec 7 - -7-1 15 - - - Jan 7 17 17 1-1 1115 - - -1 1 5 Feb 1 51-7 - - -11 7 Mar 5-1 -1-5 77-1 -17-15 1 Apr - -1-1 7-5 -1-1 1 May 7 5 5-11 -11-1 -11 1 Jun 5 1 11-575 - - -1 1 7 Jul -1-15 -5 1-15 1 5 Aug 7 5-5 715 1 11-1 17 5 Sep -15-1 -57 7-1 1 5
National Economic Trends Consumer Price Monthly/ quarterly to date Consumer Price less Food and Energy Monthly/ quarterly to date updated through 1// Producer Price Finished Goods Monthly/ quarterly 1 7 1 1 15 5 15 155 15 5 5 1 7 7 17 1 15 1557 177 7 1 1 1 1 1 5 1 17 5 1 1 5 777 5 11 5 1 1 1 17 1 5 17 7 7 171 11 1 17 11 5 5 1 5 5 17 1 7 155 11 5 5 157 5 175 7 1 15 5 51 1 7 5 17 7 5 11 - - 15 15 1 17-51 -1 1 1 1 - - - - 175 15 17 15 17-1 - - 15 1 - -5 1 1 171 17-1 15-1 17 15 15 1 17 1-51 7 Sep 51 1157 5 1 17 7 5 Oct 1 5 17 1 7 Nov 111 1 1 1 17 5 7 Dec 1177 11 171-5 -5 Jan 15 171 1 5 1 17 11 7 Feb 1 1 15 1 171 5 Mar 17 1 7 15 1 175 1 Apr 17 1 1 1 1 1 17 May 15 5 15 17 15 1 7 Jun 17 117 51 15575 5 11 1 17 Jul 11 7 1 5 5 11 5 1 1 171 7 Aug 157 - - 5 15 1 5 15-5 -57 Sep 175 5 17 1 1 5 1-1 -1 Oct 1 - - 7 175 - -1 177 - - 5 Nov 1-17 -1 1 1 1 1 17-7 - 1 Dec 11577 - -1-1 -1 1 1 17 17 17-1 -15-1 Jan 117-175 1 17 1 171 111-1 Feb 17 1 1 177 1 1711-1 -7-17 Mar 171-1 -1-1 1 1 15 - -17-5 Apr 171 - - - 1 15 1 1 17 51 - May 17 1 1-1 15 11 1 17 1 175 1-5 Jun 15 7-1 7 1 17 17 1 7 - Jul 1 1-1 15 1 11 1 1 1717 - - - Aug 15 55-1 7 1 1 15 1 177 17 1 - Sep 1571-1 7 5 15 177 - -7-7
National Economic Trends Notes Pages, 5: Final Sales is gross domestic product (GDP) minus change in private inventories Advance, Preliminary, and Final GDP Growth Rates are released during the first, second, and third months of the following quarter Changes result from incorporation of more complete information Real GDP is measured in 5 dollars The ISM (formerly Purchasing Managers ) is a weighted average of diffusion indexes for new orders, production, supplier deliveries, inventories, and employment Aggregate and Average Weekly Hours are paid hours of production and nonsupervisory employees The Inventory-Sales Ratio uses nominal (current-dollar) inventory and sales data Page : For information on how to calculate the Contribution of a component to the overall GDP growth, see the October 1 issue of the Survey of Current Business, p 1 The sign is changed for Imports Page 7: Ten-year Treasury Yields are adjusted to constant maturity; threemonth yields are secondary market averages All s used in the yield curves are adjusted to constant maturity Standard and Poor s 5 with Reinvested Dividends shows the total return: capital gains plus dividends Pages, : Oil (West Texas intermediate) and Natural Gas (Henry Hub) spot and futures prices are listed in the Wall Street Journal Spot prices are monthly averages of daily prices; futures prices are usually taken from the last trading day of the month Consumer Price is for all urban consumers The Consumption Chain Price is the index associated with the personal consumption expenditures component of GDP The Employment Cost (ECI) covers private nonfarm employers ECI Compensation refers to a fixed sample of jobs, while Compensation per Hour covers all workers in the nonfarm business sector in a given quarter In both cases, compensation is wages and salaries plus benefits Pages 1, 11: Effective with the January Employment Situation, the establishment survey data for employment, hours, and earnings have been converted from the NAICS system to the 7 NAICS system For more information see http://wwwblsgov/ces/ Nonfarm Payroll Employment is counted in a survey of about, establishments (Current Employment Statistics) It excludes self-employed individuals and workers in private households, but double-counts individuals with more than one job The Household Survey (Current Population Survey) of about, households provides estimates of civilian employment, unemployment, labor force participation, and employment-population ratio Population is civilian, noninstitutional, 1 years and over The percent confidence intervals for the unemployment (± percentage points) and change in household survey employment (±,) measure uncertainty due to sample size Because the household survey was changed in January 1, data prior to this date are not strictly comparable The Bureau of Labor Statistics announced several revisions to the Household Survey on Feb 7,, with the release of the January data For more information, see <wwwblsgov/cps/> The Job Openings is the number of job openings on the last business day of the month as a percent of total employment plus job openings Page 1: The Michigan Consumer Sentiment shows changes in a summary measure of consumers answers to five questions about their current and expected financial situation, expectations about future economic conditions, and attitudes about making large purchases The survey is based on a representative sample of US households Page 15: Gross Private Saving is the sum of personal saving, undistributed corpo profits with IVA and CCAdj (see notes for pp 1-1), and private wage accruals less disbursements Gross Government Saving is net government saving (surplus/deficit) plus consumption of fixed capital Balance on Current Account (NIPA) is net capital transfer payments to the rest of the world plus net lending or net borrowing (international trade and income flows) Pages 1, 17: Government Consumption and Investment is current expenditures on goods and services, including capital consumption (depreciation) and gross investment, as reported in the NIPAs The Unified Federal Budget Surplus/Deficit differs from NIPA Basis in four main ways: (1) NIPA excludes transactions involving existing assets; () NIPA outlays exclude government investment and include consumption of government capital, while unified budget outlays do the reverse; () NIPA accounts exclude Puerto Rico and US territories; and () various timing issues are handled differently Outlays and Receipts are from the NIPAs, except as noted Since 177, the federal Fiscal starts on October 1 Excluded agency debt was percent of federal debt at the end of fiscal 17 Federal Debt Held by the Public includes holdings of the Federal Reserve System and excludes holdings of the social security and other federal trust funds Federal grants in aid to state and local governments appear in both state and local receipts and federal outlays Pages 1, 1: The Trade Balance (shown on a balance of payments basis) is the difference between exports and imports of goods (merchandise) and services It is nearly identical in concept to the Net Exports component of GDP, but differs slightly in accounting details The Investment Income Balance equals income received from US-owned assets in other countries minus income paid on foreign-owned assets in the US The investment income balance is nearly identical in concept to the difference between gross national product and gross domestic product, but differs in accounting details The Current Account Balance is the trade balance plus the balance on investment income plus net unilateral transfers to the US from other countries Pages, 1: Output per Hour (Y/H), Unit Labor Cost (C/Y), and Compensation per Hour (C/H) are indexes which approximately obey the following relationship: %(Y/H) + %(C/Y) = %(C/H) with %() meaning percent changes Unit labor cost is shown on page Real Compensation per Hour uses the CPI to adjust for the effects of inflation Nonfarm business accounted for about 77 percent of the value of GDP in, while nonfinancial corporations accounted for about 5 percent Inventory Valuation Adjustments (IVA) remove the effect of changes in the value of existing inventories from corpo profits and proprietors income (This change in value does not correspond to current production and therefore is not part of GDP) Capital Consumption Adjustments (CCAdj) increase profits and proprietors income by the difference between estimates of economic depreciation and depreciation allowed by the tax code Components of national income not shown are rental income of persons and net interest Sources Bureau of Economic Analysis (BEA), US Dept of Commerce National income and product accounts, international trade and investment data (except by country), auto and light truck sales Census Bureau, US Dept of Commerce Inventory-sales ratios, retail sales, capital goods orders, housing starts, exports and imports by country Bureau of Labor Statistics (BLS), US Dept of Labor All employment-related data, employment cost index, consumer and producer price indexes, unit labor cost, output per hour, compensation per hour, multifactor productivity United States Department of Treasury Unified budget receipts, outlays, deficit, debt Federal Reserve Board of industrial production, treasury yields, exchange s, capacity utilization, household debt The Survey Research Center, The University of Michigan Consumer sentiment index Organization for Economic Cooperation and Development (OECD) GDP for major trading partners (not available on FRED) 7