Research >> Economics
DJ-BTMU U.S. Business Barometer down 0.1%
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For the week ending July 31, 2010, the DJ-BTMU U.S. Business Barometer experienced a small decline of -0.1 percent. The decline was concentrated, however, in a large drop in demand for electric utilities as a heat wave that plagued much of the country finally broke. All in all, July’s activity picked up markedly from June when the economy seemed to fall flat. Picking through the details we can see that it was the consumption side of the barometer that was responsible for July’s improvement; inflation-adjusted chain store sales remained healthy and mortgage application volume turned around. This is a fundamental change because up until now the consumer had been absent from the U.S. recovery with all of the responsibility for carrying the economy falling on manufacturing’s shoulders. The improvement in consumption mirrors recent comments by Fed Chairman Bernanke that spending “seems likely to pick up pace in coming quarters from its recent modest pace”, citing rising wages as a factor, and indeed wage growth looked much better in July as reported by the BLS in its August 6th payroll report.
Posted: August 12, 2010 Thursday 10:00 AM