Weekly economic update for July 3, 2023

Weekly economic update for July 3, 2023

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


economy

  • GDP grew 2.0% in the first quarter, the Bureau of Economic Analysis found.
  • The trade deficit narrowed in May, the Census Bureau stated in an advance report.
  • Durable goods orders increased 1.7% in May, according to an advance report from the Census Bureau.

Employment

  • Initial jobless claims fell by 26,000 to 239,000 in the week ended June 24, 2023, according to the Department of Labor.

Profits

  • As of June 22, 2023, of the 500 S&P 500 Index companies reporting first-quarter earnings, 383 beat analysts’ estimates, according to S&P Dow Jones Indices.
  • Quarterly profits decreased at a quarterly rate of 4.1% in the first quarter, after decreasing 2.0% in the fourth quarter, according to the Bureau of Economic Analysis.

Emotion

  • The GfK Consumer Climate Study for Germany forecasts a decline in consumer sentiment in August.

Europe

  • The European Commission’s Economic Sentiment Indicator for the euro area declined further in June.
  • The ifo Business Climate Index for Germany fell in June.

Rates

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

Risks

  • Deposit flight continues to pressure banks to tighten lending standards, increasing the potential risk of a credit squeeze.
  • Declining liquidity and deteriorating financial conditions, combined with high valuations, are contributing to a substantial uptick in risk asset volatility.
  • Global leverage is at worrisome levels and will eventually need to be paid for, at a time when most developed markets are facing a fiscal drag from the end of post-pandemic stimulus.

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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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