Weekly economic update for August 23, 2021

Weekly economic update for August 23, 2021

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


economy

  • Retail sales fell 1.1% in July, according to an advance report from the Census Bureau.
  • The Conference Board Leading Economic Index increased in July.
  • Housing starts dropped 7.0% in July compared with June, the Census Bureau stated.

Employment

  • Initial jobless claims fell by 29,000 to 348,000 in the week ended August 14, 2021.

Profits

  • As of August 12, 2021, of the 458 S&P 500 Index companies reporting second-quarter earnings, 391 beat analysts’ estimates, according to S&P Dow Jones Indices.

Emotion

  • The National Association of Homebuilders Housing Market Index declined in August.

Europe

  • Eurostat reported that euro area GDP grew 2.0% in the second quarter.
  • Euro area construction output fell 1.7% in June compared with May, according to Eurostat.

Rates

  • The yield on the 10-year Treasury note traded in a narrow range.
  • In July meeting minutes, Federal Reserve policymakers noted they “intended to begin implementing the balance sheet normalization program relatively soon, provided that the economy evolved broadly as anticipated.”

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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