Consumer Prices Up 0.2 Percent in February, or 2.3 Percent Over the Past 12 Months

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The Bureau of Labor Statistics reported that consumer prices increased 0.2 percent in February, slowing from a robust 0.5 percent gain in January. Food and energy costs decelerated in the latest data, with the latter being one of the bigger drivers of higher consumer prices in the prior release. Energy costs inched up 0.1 percent in February, slowing after a rise of 3.0 percent in January, with gasoline prices off 0.9 percent. This is largely consistent with data from the Energy Information Administration, which pegged the average price for regular conventional gasoline at $2.516 per gallon on January 29 but fell to $2.442 a gallon on February 26. At the same time, food prices were flat in February. Since February 2017, food and energy costs have increased 1.4 percent and 7.7 percent, respectively. Read More

ADP: Manufacturers Added 14,000 Workers in February, Averaging 14,700 per Month Since 2016

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Key Takeaways: The manufacturing job market continues to show signs of strength, with the sector adding 14,000 workers in February. Since the end of 2016, manufacturers have hired nearly 14,700 each month—a robust pace. In the larger economy, nonfarm payrolls were up by 235,000 in February, well above the consensus estimate of around 195,000.


ADP said that manufacturers added 14,000 workers in February, once again extending the strong job gains in the sector as production and the overall outlook have improved substantially. Indeed, manufacturing business leaders have hired at a robust rate since the end of 2016, averaging nearly 14,700 per month over the past 14 months. In contrast, manufacturing employment was more sluggish in 2016, illustrating the turnaround in the labor market since then. More importantly, we expect continued strength in job growth moving forward. Read More

Manufacturing Construction Up 1.2 Percent in January, Rising for the Fourth Straight Month

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The Census Bureau said that private manufacturing construction spending was up 1.2 percent in January, rising for the fourth straight month. The value of construction put in place in the sector increased from $63.71 billion in December to $64.50 billion in January. Since falling to $61.18 billion in September, private manufacturing construction has started to trend higher, which would be consistent with the recent uptick in economic activity and a stronger overall outlook. With that said, construction in the sector has drifted lower since achieving the all-time high of $82.13 billion in May 2015. Along those lines, manufacturing construction has declined by 9.7 percent year-over-year. For now, though, the good news is that the sector appears to have turned a corner, moving in the right direction. Read More

Real GDP Growth Revised Marginally Lower from 2.6 Percent to 2.5 Percent in the Fourth Quarter

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The Bureau of Economic Analysis said that the U.S. economy grew by an annualized 2.5 percent in the fourth quarter, off marginally from the previous estimate of 2.6 percent growth. The overall findings were little changed from the preliminary report, with somewhat better residential investment and service-sector consumer spending being offset by slightly reduced estimates for durable and nondurable goods spending and inventory spending. Nonetheless, the latest figures continued to find solid growth in consumer, business and government spending, but headline growth was pulled lower by both net exports and inventory spending. To illustrate the impact of those various components, real GDP growth would have been 4.36 percent absent the drag from net exports and inventories, which subtracted 1.83 percentage points from the top-line growth figure.

In 2017, real GDP increased by 2.3 percent, up from 1.5 percent in 2016. Since the end of the Great Recession, the U.S. economy has expanded by 2.2 percent on average. Moving forward, we anticipate 3.0 percent growth in 2018. There continues to be upward potential in that outlook for next year, especially as firms increase their investments. Passage of comprehensive tax reform and other pro-growth measures should help to stimulate economic activity, hopefully allowing us to reach 3.0 percent annual growth for the first time since 2005. Read More