Growth Slows In United States, Canada
- U.S. economic growth slowed in the final quarter of 2019. The U.S. Commerce Department reported last week that the economy expanded at a 2.6 percent annualized rate from October to December, down from 3.4 percent growth in the third quarter. The department said the deceleration reflected softer private inventory investment, personal consumption, and local, state, and federal government spending. The Federal Reserve Bank of Chicago’s National Activity Index, a key gauge of where economic growth is headed in the coming months, also fell. Click here to read that report.
- Canadian economic growth slowed to an annualized rate of 0.4 percent in the fourth quarter of 2018, the worst pace since the second quarter of 2016. The economy weakened due mainly to falling exports of crude oil and a 3.9 percent decline in household investment. The Canadian economy expanded 1.8 percent in 2018, down from three percent growth in 2017.
- New orders for manufactured goods in the United States rose 0.1 percent from November 2018 to December 2018 while shipments fell 0.2 percent. The number of unfilled orders declined 0.1 percent and inventories were virtually unchanged. Wholesale merchant inventories, meanwhile, rose 1.1 percent from November 2018 to December 2018 and 7.3 percent from December 2017 to December 2018.
- TheInstitute for Supply Management’s purchasing managers’ index (PMI) for the United States fell to 54.2 in February from 56.6 in January due to declines in the levels of production and new orders. The IHS PMI for the United States also fell, dropping to an 18-month low.
- The IHS PMI for Canada fell from 53.0 in January to 52.6 in February, a 26-month low due to softer rate of job creation and stagnating pre-production inventories.
- Regional manufacturing readings in the United States announced last week showed a mixed picture. The Federal Reserve Bank of Dallas said the industry continued to expand in Texas while the Federal Reserve Bank of Richmond reported the same thing for the Central Atlantic region. Difficulty finding workers plagued manufacturers in the Midwest. The Federal Reserve Bank of Kansas City said industry growth was flat this month as “more than three- quarters of firms reported difficulties in finding workers, despite wage increases.”
- The number of individuals who filed for the first time for federal unemployment benefits in the United States rose to 225,000 for the week that ended Feb. 23, 2019, up from 217,000 the week before. The four-week moving average of first-time claims fell, however, while the number of individuals who continued to receive benefits rose. That figure increased to 1.805 million for the week that ended Feb. 16, 2019 from 1.726 million the week before. The four-week moving average of continuing claims also rose.
- In other economic news: personal incomes in the United States rose one percent from November 2018 to December 2018 while consumption fell 0.5 percent; the University of Michigan consumer sentiment index for the United States rose 2.6 points from January to February 2019 while the Conference Board’s reading of consumer confidence increased almost 10 points; and the number of new homes under construction in the United States fell 11.2 percent from November 2018 to December 2018 and 10.9 percent from December 2017 to December 2018.