Business Conditions
Each month, one of our Research Reports articles is devoted to current business-cycle conditions. Each of these monthly discussions includes a full set of charts of AIER’s primary leading, coincident and lagging statistical indicators. We also produce two charts that aggregate the movements of the 12 leading indicators. We often publish these two charts with the monthly report, however, space does not always permit them to be included.
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Rising Prices Boost Retail Sales in February
“Retail sales rose in February but fell after adjusting for prices. Ongoing labor and materials shortages, turmoil from the Russian invasion of Ukraine, and an impending Fed tightening cycle all raise risks for the outlook.” ~ Robert Hughes
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Household Net Worth Hits a Record While Corporate Balance Sheets Improve
“Rising equity market values and surging home prices lifted aggregate household net worth to a new record in the final quarter of 2021 but is likely to suffer a setback in the first quarter of 2022 as equity prices plunge due to the Russian invasion of Ukraine.” – Robert Hughes
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Consumer Sentiment Fell Again in Early March
“Consumer sentiment fell again in early March and is consistent with prior recessions. Consumers are concerned about fallout from the war in Ukraine, rising prices, government policies, and long-term economic prospects.” ~ Robert Hughes
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Weekly Initial Claims for Unemployment Benefits Hover Around Pre-Pandemic Levels
“Weekly initial claims ticked up but remain at a very low level, suggesting the labor market remains tight. However, the Russian invasion of Ukraine dramatically increases uncertainty.” ~ Robert Hughes
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Gas and Groceries Drive AIER’s Everyday Price Index Sharply Higher in February
“AIER’s Everyday Price Index rose again in February, driven by increases in the prices for motor fuel and groceries. Price pressures are unlikely to ease in the short term given the global economic turmoil surrounding the Russian invasion of Ukraine.” ~ Robert Hughes
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Private-Sector Job Openings Fell Slightly in January but Remain Near the Record High
“Job openings and quits fell but both remained near record levels in January. Labor difficulties, material shortages, and logistical issues as well as high inflation, an impending Fed tightening cycle, and global political and economic turmoil are threatening the U.S. economy.” ~ Robert Hughes
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AIER Leading Indicators Index Posts Sudden Drop, Risks Rise
“AIER’s Leading Indicators Index dropped to 46 in February. Disruptions to labor supply, shortages of materials, and logistics bottlenecks continue to pressure prices. Falling new Covid cases had the potential to support businesses’ efforts to expand production, but turmoil surrounding the Russian invasion of Ukraine has launched a new wave of disruptions. The outlook has…
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Private Payrolls Post Another Strong Gain, Adding 654,000 Jobs in February
“Payrolls growth was strong again in February. While these results support a positive outlook for growth, geopolitical turmoil surrounding the Russian invasion of Ukraine has spurred a new wave of risks and potential disruptions to the global economy.” ~ Robert Hughes
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Services-Sector Growth Slowed by Labor, Materials, and Logistical Constraints
“Services-sector expansion likely slowed in February as shortages of labor and materials continue. Fewer new cases of Covid may provide some relief but turmoil as a result of the Russian invasion of Ukraine has the potential to disrupt the global economy and businesses.” ~ Robert Hughes
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Weekly Initial Claims for Unemployment Benefits Fall to the Lowest Level of the Year
“Weekly initial claims ticked down for a second week. Overall, claims remain at a very low level and the labor market remains very tight. However, the Russian invasion of Ukraine dramatically increases uncertainty.” ~ Robert Hughes
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February Unit Auto Sales Slowed as Assemblies, Inventories, and Prices Stabilize in January
“Light-vehicle sales slowed in February as component shortages continue to restrain production. Assemblies, inventory, and prices continued to show signs of stabilization through January, albeit at extreme levels.” ~ Robert Hughes
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Manufacturing-Sector Survey Showed Strong Results in February
“Manufacturing-sector demand remained strong in February. Production increased despite ongoing labor and logistical issues but constraints on faster production growth continue. Recent events in Ukraine may be yet another source of disruption and further delay the return to normalcy.” ~ Robert Hughes
