The Latest Economic News From The U.S. And Canada
- According to the U.S. Commerce Department, the U.S. economy expanded at a five percent annualized rate in the third quarter of 2014, up from the department’s previous 3.9 percent estimate for the quarter. The favorable revision was driven by higher personal consumption and residential investment. In another positive report, the Chicago Federal Reserve announced its National Activity Index, a key indicator of what future growth will look like, rose to +0.73 in November from +0.31 in October. Meanwhile, the Canadian economy expanded 0.3 percent in October and was on track to expand 2.5 percent for all of 2014.
- The Markit purchasing managers’ index (PMI) for the United States fell to 53.9 in December from 54.8 in November. According to Markit, “Anecdotal evidence suggested that uncertainty towards the global economic outlook had contributed to slower production growth and softer new business gains during recent months.” The Institute for Supply Management’s PMI for the U.S. also fell in December as inventories declined. Meanwhile, the Royal Bank of Canada PMI fell to 53.9 in December from 55.3 in November as production, new orders and the rate of new job creation slowed.
- The manufacturing sectors in various regions of the U.S. continued to show strength last month. The Richmond Federal Reserve Bank said its manufacturing index increased to +7 in December from +4 in November as shipments, production and employment levels all improved. Additionally, the Dallas Federal Reserve Bank announced its manufacturing reading rose to +15.8 in December from +6 in November due to higher capacity utilization and shipments.
- The number of Americans who filed for federal unemployment benefits fell to 280,000 for the week that ended Dec. 20 from 289,000 the week before. The four-week moving average of first-time claims also fell even while the number of Americans who continued to file for jobless benefits increased to 2.403 million for the week that ended Dec. 13 from 2.378 million the week before. The four-week moving average of continuing claims also increased in mid-December.
- U.S. consumers were more optimistic at the end of 2014. The University of Michigan consumer sentiment increased from 88.8 in November to 93.6 in December, the index’s highest level since early 2007, while the Conference Board index of consumer confidence rose from 91.0 in November to 92.6 in December. Consumers in that survey felt more positively about the economy today, but their expectations for the future did decline.
- In other economic news: personal incomes in the U.S. rose 0.4 percent from October to November while consumption increased 0.6 percent; sales of existing homes in the U.S. dropped 6.1 percent from October 2014 to November 2014, but were still up 2.1 percent between November 2013 and November 2014; sales of new homes in the U.S., meanwhile, fell 1.6 percent between October and November and were down by the same percentage year-over-year; and, finally, overall construction spending in the U.S. fell 0.3 percent for the month, but was up 2.4 percent between November 2013 and November 2014.