U.S., Canadian Economic Indicators Point To Slowing Recovery
- As The Canadian Press reported, Canadian wholesale sales rose 0.3 percent in August, the fourth monthly increase in a row. (Wholesale sales increased 5.2 percent in July and 18.5 percent in June.) Four of seven subsectors measured by Statistics Canada rose in August, including the building material and supplies subsector where sales expanded seven percent and the motor vehicle and motor vehicle parts and accessories subsector, which expanded 2.5 percent.
- The Conference Board’s Leading Economic Index for the United States, a key predictor of future growth, increased 0.7 percent in September to 107.2 following a 1.4 percent increase in August and a 2.0 percent increase in July. The Conference Board said the deceleration in expansion could suggest “U.S. economy could be losing momentum heading into the final quarter of 2020.”
- The Federal Reserve Bank of Kansas City announced last week that its manufacturing reading for the Midwest region rose to +13 in October from +11 the month before. Production, shipments, new orders, employment, and employee workweek indexes all improved in September. The bank also said, “Activity at non-durable and durable goods factories expanded at a similar pace” and “the increase in activity was faster at fabricated metal and machinery plants in October.”
- According to the U.S. Department of Labor, 787,000 individuals filed for federal unemployment benefits during the week that ended October 17, a decrease of 55,000 from the previous week’s level. The four-week moving average of first-time claims also fell. The number of individuals who continue to receive benefits also declined, to 8.373 million for the week that ended October 10 from 9.397 million the week before. The four-week moving average of continuing claims also declined. In other jobs-related news: unemployment rates were lower in September in 30 states, higher in eight, and stable in 12 states and the District of Columbia.
- In other economic news: the number of new homes under construction in the United States rose 1.9 percent from August 2020 to September 2020 and 11.1 percent from September 2019 to September 2020; retail sales in Canada increased 0.4 percent in August, a reading that was lower than the 1.1 percent increase analysts had expected; and existing home sales in the United States rose 9.4 percent from August 2020 to September 2020 and almost 21 percent from September 2019 to September 2020.