Inflation has remained largely in check this fall. Here are the five things we learned from U.S. economic data released during the week ending November 13.
Consumer prices held steady in October. The Consumer Price Index (CPI) failed to rise on a seasonally adjusted basis for the first time since May, per the Bureau of Labor Statistics. Food CPI gained 0.2 percent (including a 0.3 percent for food consumed away from home) while energy CPI eked out a 0.1 percent increase (gasoline CPI: -0.5 percent). Net of food and energy, core CPI also matched its September reading. While prices rose for new vehicles (+0.4 percent), shelter (+0.1 percent), and transportation services (+0.1 percent), they fell for apparel (-1.2 percent), medical care commodities (-0.8 percent), medical care services (-0.3 percent), and used cars/trucks (-0.1 percent). Over the past year, CPI has risen 1.2 percent while the core measure was up 1.6 percent.
Wholesale prices advanced for a sixth straight month. The Producer Price Index (PPI) for final demand increased a seasonally adjusted 0.3 percent in October while the Bureau of Labor Statistics measure core wholesale price measure (net of food, energy, and trade services) grew 0.2 percent. Wholesale food prices jumped 2.4 percent (its biggest increase since May as fruits/vegetable prices skyrocketed 26.8 percent) while that for energy rose 0.8 percent. Core goods wholesale prices held steady during the month. PPI for services grew 0.2 percent, with transportation/warehousing prices swelling 1.1 percent. Over the past year, PPI was up a modest 0.5 percent while the core measure had a 12-month comparable of +0.8 percent.
Job openings increased slightly while hiring slowed a bit in September. The Bureau of Labor Statistics estimates that job openings totaled a seasonally adjusted 6.436 million on the final day of the month, up 84,000 from August but off 8.7 percent from a year earlier. While most industries had fewer openings relative to September 2019, there were a few exceptions: health care/social assistance and manufacturing. Employers hired 5.952 million people in September, down 81,000 from the prior month and 1.5 percent from a year earlier. 4.664 million people left their jobs during the month, down 25,000 from the previous month and 18.7 percent from September 2019. The separations count included 3.018 million people who quit their jobs (up 179,000 from August) and 1.333 million people affected by a layoff/firing (down 200,000 from August).
Small business owner sentiment was stable in October. The Small Business Optimism Index from the National Federation of Independent Business held steady for the month at its pandemic high of 104.0 (seasonally adjusted, 1986=100). The index was at 102.4 one year ago. Four index components rose during the month—including a large gain for earnings trends—while five measures declined—including a sizable pullback for plans to increase employment. The press release noted that the pandemic, “possible government mandated shutdowns,” and pending election results pushed the NFIB’s uncertainty index to its highest reading since November 2016.
The U.S. government rolled up another massive budget deficit in October. The Department of Treasury reports federal government receipts totaled $239.7 billion during the month, down from $245.5 billion from the same month a year earlier. Meanwhile, outlays surged from $380.0 billion in October 2019 to $521.8 billion this October. The resulting deficit for the first month of FY2021 ballooned to -$284.1 billion, up 111.3 percent from a year earlier. Dragging down receipts was the 14.0 percent decline in individual income tax collections. Among the areas with rising spending were the Department of Health & Human Services, Department of Labor, Department of Agriculture, and Social Security Administration.
Other U.S. economic data released over the past week:
- Jobless Claims (Week ending November 7, First-Time Claims, seasonally adjusted): 709,000 (-48,000 vs. the previous week, +487,000 vs. the same week a year earlier). 4-week moving average: 755,250 (+249.7% vs. the same week a year earlier).
- University of Michigan Surveys of Consumers (November 2020-preliminary, Index of Consumer Sentiment (1966=100), seasonally adjusted): 77.0 (October 2020: 81.8, November 2019: 96.8).
- Senior Loan Officers Survey
The opinions expressed here are not necessarily those of Kevin’s current employer. No endorsements are implied.
What We Learned About the U.S. Economy Last Week 