Weekly economic update

Economic Update for July 16, 2018   |   Download PDF

Highlights of news-making events of the past week, from the economy and profits to Europe and interest rates.

economy

  • Wholesale sales jumped 2.5% in May, the Census Bureau announced.
  • The Producer Price Index for final demand rose 0.3% in June, according to the Bureau of Labor Statistics.
  • The CPI rose 0.1% and core CPI advanced 0.2% in June, the Bureau of Labor Statistics reported.
  • Import prices fell 0.4% and export prices rose 0.3% in June, the Bureau of Labor Statistics stated.

employment

  • Initial jobless claims fell by 18,000 to 214,000 in the week ended July 7, 2018, according to the Labor Department.

profits

  • The estimated earnings growth rate for the S&P 500 Index is 20.0% for the second quarter, according to FactSet. If the final rate is 20.0%, it will be the second highest earnings growth rate since the third quarter of 2010 (34%), the report stated.

emotion

  • The University of Michigan’s index of consumer sentiment fell to 97.1 in July from 98.2 in June.
  • The NFIB small-business optimism index fell 0.6 points to 107.2 in June.
  • The Survey of Consumer Expectations showed no change in inflation expectations in June, according to the New York Federal Reserve.

europe

  • The ZEW Indicator of Economic Sentiment for Germany declined in July.
  • In Germany, exports fell 1.3% in May, the Federal Statistical Office stated.
  • The United Kingdom’s Index of Production fell 0.6% for the three months ending in May, the Office for National Statistics noted.

rates

  • The yield on the 10-year U.S. Treasury note traded in a narrow range.

risks

  • The strengthening U.S. dollar, widening credit spreads, and higher oil prices are putting pressure on select emerging-market countries.
  • Worries of dwindling global spare capacity in oil production may cause prices to spike, risking an inflation scare.
  • The Fed appears to be on course to invert the yield curve.

FOR DEALER USE ONLY — Not for public distribution

All economic and performance information is historical and does not guarantee future results. The views and opinions expressed are those of Putnam Investments, are subject to change with market conditions, and are not meant as investment advice.