U.S., Canadian Economic Growth Readings Stronger Than Expected
- According to the U.S. Department of Commerce, real U.S. gross domestic product increased at an annual rate of 6.7 percent in the second quarter of 2021, reflecting the continued economic recovery, reopening of establishments, and continued government response related to the COVID-19 pandemic. The increase was revised up 0.1 percentage point from the estimate released in August.
- Statistics Canada announced last week that the country’s gross domestic product declined 0.1 percent in July, an improvement on the agency’s preliminary estimate, which had indicated a 0.4 percent decline. Thirteen of the 20 industrial sectors posted gains. The greatest expansion came from hotels and restaurants. Manufacturing declined due to supply shortages for automobile and auto-parts makers.
- The Institute for Supply Management’s Purchasing Managers’ Index rose 1.2 percentage points to 61.1 percent in September. It was the sixteenth month in a row that the reading indicated expansion in the economy. Employment was up, as were inventories, but the rate of new orders were unchanged last month and the production reading fell slightly. Read the full report here.
- Manufacturing readings in the various regions of the United States were mixed at the end of September. The Federal Reserve Bank of Dallas announced last week that its production index rose three points to +24.2, a reading that was well above average and indicated solid output growth. Indices for shipments and capacity utilization also rose, but new orders and the rate of orders were down. Read the full report here. The Federal Reserve Bank of Richmond announced its manufacturing reading softened. The bank’s composite index declined from +9 in August to -3 in September and the indexes for shipments and new orders were below zero for the first time since May 2020. The reading for employment remained positive, however. The bank said many firms reported weakening local business conditions, but also were optimistic conditions would improve in the next six months. Read that report here.
- According to the U.S. Department of Labor, 362,000 people filed for federal unemployment benefits for the first time during the week that ended September 25, 2021. That number was up 11,000 from the previous week. The four-week moving average of first time claims rose to 340,000 from 335,750 the week before. During the week that ended September 18, 2.802 million people continued to receive jobless benefits, down from 2.82 million the previous week.
- U.S. construction spending was flat from July 2021 to August 2021, but increased 8.9 percent between August 2020 and August 2021.
- In other economic news: the Conference Board’s Consumer Confidence Index® declined again in September and now stands at 109.3, down from 115.2 in August; personal incomes in the United States rose 0.2 percent; and disposable personal income was up 0.1 percent and personal consumption was up 0.8 percent.