Weekly economic update for August 16, 2021

Weekly economic update for August 16, 2021

Highlights of key economic statistics from last week compiled by Putnam Investments.


economy

  • The CPI rose 0.5% and core CPI increased 0.3% in July, according to the Bureau of Labor Statistics.
  • The Producer Price Index for final demand rose 1.0% in July, the Bureau of Labor Statistics reported.

Employment

  • Initial jobless claims fell by 12,000 to 375,000 in the week ended August 7, 2021.
  • The Bureau of Labor Statistics noted that labor productivity increased 2.3% and unit labor costs rose 1.0% in the second quarter.

Profits

  • As of August 4, 2021, of the 426 S&P 500 Index companies reporting second-quarter earnings, 368 beat analysts’ estimates, according to S&P Dow Jones Indices.

Emotion

  • The University of Michigan’s index of consumer sentiment dropped to 70.2 in August from 81.2 in July.
  • The NFIB Small Business Optimism Index slipped in July.

Europe

  • Eurostat found that euro area industrial production fell 0.3% in June.
  • Germany’s Federal Statistical Office reported that exports increased 1.3% in June compared with May.
  • The ZEW Indicator of Economic Sentiment for Germany fell in August.

Rates

  • The yield on the 10-year Treasury note rose.

Risks

  • Divergent vaccination rollout timelines and virus mutations risk could cause a shift from a synchronized global recovery to a more fractured regional, multispeed recovery.
  • Global leverage, created by pandemic response packages, is at worrisome levels and will eventually need to be paid for.
  • A shift from “just in time” to “just in case” inventory models could exacerbate supply chain concerns.

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All economic and performance information is historical and does not guarantee future results. The views and opinions expressed are those of Putnam Investments, are subject to change with market conditions, and are not meant as investment advice.

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