It’s been a week of good numbers for the economy, as the latest reports from the federal government point to better-than-expected results.
Consumer Spending
Retail sales nationwide jumped 1% in July, the Commerce Department reported Thursday (Aug. 16), topping economists’ forecasts of a 0.4% increase.
The increase in consumer spending is the biggest since January 2023, with the strongest sales reported by auto dealers, electronics, appliance stores and supermarkets. Consumer spending makes up roughly 70 percent of the U.S. economy.
Prices in the New York-Newark-Jersey City (Meadowlands) area rose 0.3%, the BLS said. Regional Commissioner William J. Sibley said in a statement that the July increase was primarily driven by higher prices for shelter.
Food prices dropped 0.3% in the region, with food at home down 0.5%, and declines in four of the six grocery categories. Among the groceries with lower prices in July were chicken and coffee. Prices for food away from home edged down 0.1%, per the report.
The index for all items less food and energy rose 0.3 percent in July. “Higher prices for shelter, including 0.5% increases for both owners’ equivalent rent and residential rent, contributed to the July increase,” according the report.
Motor vehicle insurance, motor vehicle maintenance and repair, and new and used motor vehicles all were up 1.2%. Apparel went down 4.7%, while airline fares and medical care went down 0.9%.
Inflation
The July 2024 Consumer Price Index (CPI) rose 0.2% month-over-month (MoM) and 2.9% year-over-year (YoY), marking the first time inflation dipped below 3% since 2021,” the Bureau of Labor Statistics reported on Wednesday (Aug. 14).
Core inflation, which excludes food and energy costs, dropped for the fourth consecutive month. Food prices increased 0.2% from the previous month, shelter is up 0.4%, new vehicles are down 0.2% while auto insurance is up 1.2%.
Inflation peaked at 9.1% in 2022 during the Covid-19 pandemic. The Federal Reserve aims for a 2% inflation rate.
Unemployment
Initial jobless claims in the U.S. dropped more than expected for the week ended Aug. 10, with 227,000 claims, down 7,000 from the previous week and lower than the estimate of 235,000.
In New Jersey, however, new jobless claims for the same week increased to 9,738, up from 9,533 the week before, the Labor Department said.
