Last updateThu, 22 Oct 2020 5pm

Durable Goods Orders Jumped 11.2% in July

New orders for manufactured durable goods in July increased $23.2 billion or 11.2% to $230.7 billion, the U.S. Department of Commerce announced. This increase, up three consecutive months, followed a 7.7% June increase. Despite these recent gains, durable goods orders are still down 5.0% year-over-year. With transportation equipment excluded, sales have fallen 1.0% since July 2019.

Consumer Confidence Hits Six-Year Low in U.S.

The Conference Board Consumer Confidence Index decreased in August, after declining in July. The Index now stands at 84.8, a six-year low, down from 91.7 in July. The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – decreased sharply from 95.9 to 84.2. The Expectations Index – based on consumers’ short-term outlook for income, business, and labor market conditions – declined from 88.9 in July to 85.2 this month.

Texas Economy Showing Signs of Expansion

The Texas economy showed continued signs of expansion in July, though the pace slowed from June’s robust growth. Payrolls across the state edged up and the unemployment rate dipped. The Texas Leading Index continued to grow. Service and retail revenue indexes contracted in July as the COVID-19 pandemic lingered, while the manufacturing production index inched up, according to the Texas Business Outlook Surveys. Texas exports rose in June, though not enough to result in an increase in the three-month moving average, and in early August, overall credit and debit card spending had largely recovered from its steep decline in March.

U.S. Manufacturing Shows Improvement in August

Manufacturers signaled a solid improvement in operating conditions midway through the third quarter, as highlighted by the IHS Markit Flash U.S. Manufacturing Purchasing Managers’ Index posting at 53.6 in August, up from 50.9 in July. The overall rate of improvement was the fastest since January 2019.

The upturn was driven by quicker expansions in output and new orders. Many goods producers stated that the resumption of business operations and the reopening of clients had helped to boost sales, with some also noting larger orders being placed by customers. Firms also recorded the first rise in foreign client demand since December 2019.


Leading Economic Indicators Up Slightly in July

The Conference Board Leading Economic Index (LEI) for the U.S. increased 1.4% in July to 104.4, following a 3.0% increase in June and a 3.1% increase in May.

“The U.S. LEI increased for the third consecutive month in July, albeit at a slower pace than the sharp increases in the previous two months,” said Ataman Ozyildirim, senior director of economic research at The Conference Board. “Despite the recent gains in the LEI, which remain fairly broad-based, the initial post-pandemic recovery appears to be losing steam. The LEI suggests that the pace of economic growth will weaken substantially during the final months of 2020.”

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