- Continuing Claims rose to 2507K versus estimates of 2475K and 2473K prior.
- Leading Indicators for July fell .1% versus estimates of a .1% rise and a .1% gain in June.
- The Philly Fed for August rose to 18.5 versus estimates of 9.0 and a reading of 6.0 in July.
BOTTOM LINE: The number of US workers filing first-time applications for state jobless benefits fell last week, evidence demand is strong enough to encourage companies to retain workers, Bloomberg said. The four-week moving-average rose to 311,250 from 309,500 the prior week. The unemployment rate among people eligible for benefits, which tracks the US unemployment rate, held at 1.9%. I continue to believe the labor market will remain healthy without generating substantial unit labor cost increases over the intermediate-term.
The index of leading economic indicators unexpectedly dropped .1% in July, reinforcing forecasts that the US economy will slow in the next three to six months, Bloomberg said. The US economy will grow at an annual rate of 2.8% in the second quarter, according to a Bloomberg survey. An increase in the factory workweek contributed the biggest gain to the indicator. I expect 2Q growth to be revised higher to around 3.0% and second half growth to average around 2.5-3%.
Manufacturing in the Philly area accelerated more than expected this month as orders and shipments jumped, Bloomberg said. The prices paid fell to 45.3 from 50.3 the prior month. The new orders component rose to 15.7 versus 10.1 the prior month. The expectations component fell to 7.4 from 15.4 the prior month. I expect manufacturing to continue to decelerate back to more average levels, however inventory rebuilding will keep it relatively healthy.