ELLIOTT D. POLLACK
& Company
FOR IMMEDIATE RELEASE
June 5th, 2017
The Monday Morning Quarterback
A quick analysis of important economic data released over the past week
While the press and others might not be happy with President Trump, the stock market, consumers (as it relates to the economy) and businesses seem to feel more positive about the effect of his policies on the economy. The market is at all-time highs. Consumer confidence, while off the peak, remains at a high level. Employment continues to grow slowly, the unemployment rate continues to decline, incomes continue to rise and the manufacturing sector continues to expand. So, while auto sales are weaker than expected, the overall picture remains positive given the perspective of a weaker than normal cycle.
The same dynamics appear to be at play in Arizona. Here, the housing market continues to improve. Housing prices continue to go up faster than inflation. And the tourism market remains positive. At least for now, like Old Man River, the expansion just keeps rolling along. And this is before any of this economic and tax policies have been passed
U.S. Snapshot:
- Total nonfarm payroll employment increased by 138,000 in May. This compared to an average monthly gain of 181,000 over the prior 12 months. Over the past 3 months, the average gain was 121,000 per month. The May gain was below expectations. Despite this, the stock market reacted well to the number.
- The unemployment rate declined to 4.3% in May. This compares to 4.4% in April and 4.7% a year ago. This is the lowest level of unemployment since May 2001.
- Personal income in the U.S. rose 0.4% between March and April and now stands 3.6% above April 2016. Disposable personal income also rose 0.4% for the month and is 3.7% higher than a year ago. Personal consumption expenditures were up 0.4% for the month in April and was up 4.3% above a year ago. As a result, the personal savings rate dropped to 5.3% in April, down from 5.9% a year ago.
- Consumer confidence lost 1.5 points in May falling to 117.9. This brings confidence down from an April reading of 119.4, its second monthly decline in a row. Despite this, the overall level of consumer confidence remains high. The current level of 117.9 compares to a level of 92.4 a year ago.
- April’s auto sales rebound was modest and short lived. May unit vehicle sales fell to a 16.6 million annualized rate from April’s 16.8 million.
- The May ISM Manufacturing index was 54.9 compared to 54.8 April and 51.0 a year ago. This is the 96th consecutive month of expansion for the economy.
- Construction spending in April was down 1.4% from the March level and now stands 6.7% above a year ago.
- The S&P/Case-Shiller home price index for March showed that the 20 city composite index was up 1.0% for the month and now stands 5.9% above year earlier levels.
Arizona Snapshot:
- Air traffic at Sky Harbor International airport increased by 2.7% in April compared to a year ago. Enplanements were up 4.1% from a year ago while deplanements were up 1.3%.
- The Greater Phoenix S&P/Case-Shiller Home Price Index was up 0.6% in March when compared to February and was up 5.6% from a year ago.
