Economic data improves in June, but points to a modest recovery in Q3
2024-04-06 17:00
The EIU nowcast for the US economy for Q2 2020 improved to -7.97%
(quarter-on-quarter) as of last week, compared with -8.21% during the week ending July 10th.
The EIU’s nowcast model predicts US GDP to expand by 2.17% (quarter-on-quarter) in Q3 2020, improving from the nowcast of 0.52% the week before.
The majority of the releases from last week–such as housing data, industrial production and capacity utilization, manufacturing sentiment from Empire State and Philadelphia Fed’s surveys–increased as expected, in line with the trend of recovering activities in the U.S. economy from the economic slump experienced in April 2020.
However, despite the recovery, the data remain well below the levels seen prior to the pandemic.
Retail sales and food services were the only exceptions, which jumped back to pre-pandemic levels for the month of June; however, it is unclear if stimulus measures will support this trend in the coming months.
This highlights that the recovery is unlikely to be as steep as the slump in Q2, and with the recent pick-up in infection cases, the high risk remains for the recovery in Q3.
This is evident from the July flash estimate for consumer sentiment indicators from the University of Michigan which witnessed an unexpected drop as compared with the month of June.
Also, initial unemployment claims continued to be steady at 1.3 million, which is high compared with the historic trend. This indicates that despite the recent record gains in employment, labour market recovery remains fragile.
To get the full background to our EIU Nowcast, view our methodology and FAQs page or contact us using the form below.
Data releases (last week)
Indicators Reference Period Latest data Previous data Industrial Production Index (SA, 2012=100) Jun (20’) 97.50 92.50 Capacity Utilization: Industry (SA, Percent of Capacity) Jun (20’) 68.60 65.10 Empire State Manufacturing Survey, Seasonally adjusted diffusion index Jul (20’) 17.20 -0.20 Retail Sales & Food Services (SA, Mil.$) Jun (20’) 524306.00 487708.00 Philadelphia Manufacturing Survey Current Activity Diffusion Index Jul (20’) 24.10 27.50 Philadelphia Manufacturing Survey New Orders Jul (20’) 23.00 16.70 Unemployment Insurance: Initial Claims, State Programs (SA, Thous) Jul (20’) 1300.00 1408.00 University of Michigan: Consumer Sentiment (NSA, Q1-66=100) Jul (20’) 73.20 78.10 University of Michigan: Current Economic Conditions (NSA, Q1-66=100) Jul (20’) 84.20 87.10 University of Michigan: Consumer Expectations (NSA, Q1-66=100) Jul (20’) 66.20 72.30 New Private Housing Units Authorized by Building Permit [Flash] (SAAR, Thous.Units) Jul (20’) 1241.00 1216.00 Housing Starts (SAAR, Thous.Units) Jul (20’) 1186.00 1011.00 Data releases (current week)
Indicators Reference Period Release Date Unemployment Insurance: Initial Claims, State Programs (SA, Thous) Jul (20’) 23rd July 2020 New Private Housing Units Authorized by Building Permit [Actual] (SAAR, Thous.Units) Jun (20’) 24th July 2020 US PMI: Svcs Business Activity Index [Actual] [Latest Est incl Flash](SA, 50+=Expansion) Jul (20’) 24th July 2020 US Markit PMI: Manufacturing [Actual] [Latest Estimates incl Flash] (SA, 50 +=Expansion) Jul (20’) 24th July 2020 Contact us
To find out more about The EIU’s Nowcasting capabilities, fill in the form below and a member of our team will contact you.
