Summer Doldrums: What We Learned During the Week of August 24 – 28

Consumers took July off. Here are five things we learned from U.S. economic data released during the week ending August 28. 

Consumer spending stagnated in July. The Bureau of Economic Analysis reports that real Personal Consumption Expenditures (PCE) were unchanged on a seasonally adjusted basis, down from June’s 0.4 percent advance. Goods spending slumped 0.6 percent, with declines in both durables (-1.4 percent) and nondurables (-0.2 percent). Services expenditures increased 0.3 percent. Without inflation adjustments, nominal PCE grew 0.2 percent, fueled by gains in nominal personal income (+0.4 percent) and disposable income (+0.5 percent). Real disposable income rose 0.4 percent during the month. The savings rate improved by 0.4 percentage points to +3.0 percent (its highest level since March). The same report shows the PCE Price Index (a closely watched inflation measure) and the core index (net of energy and food) both up 0.2 percent for the month, with year-over-year increases of +2.1 percent and +2.4 percent, respectively.

A revision keeps the Q2 economic growth estimate as middling. The second estimate of 2026 Q2 Gross Domestic Product (GDP) shows the U.S. expanding at a seasonally adjusted annualized rate of 1.5 percent. This matches the Bureau of Economic Analysis’s initial Q2 GDP growth estimate, reported a month earlier, but is down from Q1’s 2.1 percent advance. Supporting Q2 GDP growth were, in descending order, personal consumption, nonresidential fixed investment (business investment), state/local government spending, and residential fixed investment (housing). Conversely, net exports, the change in private inventories, and federal government expenditures were drags. The same report notes that corporate profits rose 9.6 percent in Q2 to an annualized $4.827 trillion, 22.8 percent above year-ago levels. 

Economic growth slowed in July. The Chicago Fed National Activity Index (CFNAI) fell 14 basis points to -0.08. A CFNAI between -0.70 and zero indicates that the U.S. economy is growing at a pace slower than its historical average. Forty of the CFNAI’s 85 components made positive contributions to the index, while the other 85 dragged it down. Small positive contributions came from measures tied to sales/orders/inventories (+0.02) and from production (+0.01), while negative effects came from personal consumption/housing (-0.09) and from employment (-0.01). The CFNAI’s three-month moving average fell five basis points to -0.04. 

Durable goods orders rise in July. The Census Bureau estimates that new orders for manufactured durable goods increased 1.1 percent to a seasonally adjusted $339.3. Year-to-date durable goods orders were up 7.6 percent from the comparable 2025 months. Orders for transportation goods grew 2.3 percent, boosted by civilian aircraft (+12.7 percent) and defense aircraft (+4.9 percent), along with a 0.9 percent advance for motor vehicles/parts. Non-transportation durable goods orders increased 0.4 percent, with gains in primary metals (+1.5 percent), machinery (+1.2 percent), and fabricated metal products (+0.4 percent). Durable goods shipments rose 1.0 percent to $334.7 trillion, with year-to-date shipments 8.5 percent ahead of last year’s comparable pace. 

Consumers remained wary about the future. The Conference Board’s Consumer Confidence Index slipped 0.8 points to a seasonally adjusted 89.3 (1985=100). The index was at 97.8 one year ago. The present conditions index jumped 6.8 points to 121.2, while the expectations measure dropped 5.8 points to 68.2. 18.9 percent of consumers feel business conditions were “good,” just above the 17.6 percent who view them as “bad.” 27.0 percent of Americans say jobs were “plentiful,” compared with 19.5 percent who say they were “hard to get.” The press release noted many comments about prices, “war/conflict, trade, and jobs.” 

Meanwhile, the University of Michigan’s Index of Consumer Sentiment fell 3.5 points to 51.7 (1966Q1=100). The index was down 11.2 percent from a year earlier. Measures for current (51.9, down 2.9 points) and expected (51.5, down 3.9 points) both declined from July, with year-over-year comparables of -15.9 percent and -7.9 percent, respectively. Survey respondents expect prices to rise 4.0 percent over the next year.  

Other U.S. economic data released over the past week:

• Jobless Claims (Week ending August 22, 2026, First-Time Claims, seasonally adjusted): 203,000 (-4,000 vs. the previous week, -26,000 vs. the same week a year earlier). 4-week moving average: 205,500 (-9.9% vs. the same week a year earlier).
• New Home Sales (July 2026, Sales of New Single-Family Homes, seasonally adjusted annualized rate): 607,000 (-10.5% vs. June 2026; -6.3% vs. July 2025).
• FHFA House Price Index (June 2026, Purchase-Only Index, seasonally adjusted): Unchanged vs. May 2026; +2.3% vs. June 2025.
• S&P Case Shiller Home Price Index (June 2026, National Index, seasonally adjusted): +0.1% vs. May 2026; +1.3% vs. June 2025.

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