Economic and jobs news thread

weatheriscool
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weatheriscool
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Inflation rose 0.4% in April and 4.7% from a year ago, according to key gauge for the Fed

PUBLISHED FRI, MAY 26 2023 * 8:36 AM EDT * UPDATED AN HOUR AGO

Jeff Cox
@JEFF.COX.7528 https://facebook.com/jeff.cox.7528
@JEFFCOXCNBCCOM https://twitter.com/JeffCoxCNBCcom

KEY POINTS
* The core personal consumption expenditures price index rose 0.4% in April and 4.7% from a year ago, both a touch higher than expected.
* Despite the higher inflation rate, consumer spending held up well as personal income increased. Spending jumped 0.8% for the month, while personal income accelerated 0.4%.
* Immediately following the report, market pricing swung to a 56% chance that the Fed will enact another quarter percentage point interest rate hike at the June meeting.

Inflation stayed stubbornly high in April, potentially reinforcing the chances that interest rates could stay higher for longer, according to a gauge released Friday that the Federal Reserve follows closely. ... The personal consumption expenditures price index, which measures a variety of goods and services and adjusts for changes in consumer behavior, rose 0.4% for the month excluding food and energy costs, higher than the 0.3% Dow Jones estimate.

On an annual basis, the gauge increased 4.7%, 0.1 percentage point higher than expected, the Commerce Department reported. (1) ... Including food and energy, headline PCE also rose 0.4% and was up 4.4% from a year ago, higher than the 4.2% rate in March. ... Despite the higher inflation rate, consumer spending held up well as personal income increased. ... The report showed that spending jumped 0.8% for the month, while personal income accelerated 0.4%. Both numbers were expected to increase 0.4%.

Price increases were spread almost evenly, with goods rising 0.3% and services up 0.4%. Food prices fell less than 0.1% while energy prices increased 0.7%. On an annual basis, goods prices increased 2.1% and services rose by 5.5%, a further indication that the U.S. was tilting back toward a services-focused economy. ... Food prices rose 6.9% from a year ago while energy fell 6.3%. Both monthly PCE gains were the most since January.

Markets reacted little to the news, with stock market futures pointing higher as investors focused on improving prospects for a debt ceiling deal in Washington. Treasury yields were mostly higher.
{snip}

(1) https://www.bea.gov/news/2023/personal- ... april-2023
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All Floridians Should Be Worried About DeSantis’ New Anti-Immigration Law
by Isabela Dias
May 31, 2023

Introduction:
(Mother Jones) Guadalupe de la Cruz, director of the Florida chapter of the American Friends Service Committee (AFSC), wasn’t surprised when Gov. Ron DeSantis signed one of the most restrictive anti-immigration laws in the country this May. After all, DeSantis already championed legislation banning sanctuary cities in the state and engineered political stunts with flights of migrants from Texas to Martha’s Vineyard. These policies intentionally created to target the immigrant community, de la Cruz says, are part of “a pattern we’ve seen before.” Nonetheless, she adds, this new measure brings discrimination against immigrants to a different level. “It was still very disappointing to have a governor support such a racist, anti-immigrant law,” she says.

Conclusion:

Gina Fraga, an immigration lawyer in Palm Beach, recently spoke about the new law to approximately 200 people gathered at a church. “The look on their faces is sheer panic,” she says. “They don’t know what to do.” Fraga says she has already heard of clients receiving notices from bosses terminating their employment. She has also talked to business owners at pool companies, landscaping, constructing, and staffing agencies, who are worried about what this law will mean for them. Companies that once transported seasonal migrant farmworkers back from North Carolina or Georgia could risk their drivers going to jail. “Industries are going to be affected,” she says. “Floridians are going to see an increase in prices of food and veggies.”

Videos of empty fields and construction sites have gone viral on social media and truckers have called for a boycott of shipments to Florida. “Remember one thing, in Florida, more goes in than comes out,” a Cuban driver said on TikTok, “So if we don’t take anything to Florida, tell me, what are they going to have? Let’s see what the governor is going to do. Is his little truck going to take things to [the] lousy racist people he has there?”

“This is just the tip of an iceberg that is much more dangerous,” Bozzetto says. “It’s an attack on our systems of trust, of neighborly everyday interactions—on our democracy.”
Read more here: https://www.motherjones.com/politics/2 ... ion-law/
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weatheriscool
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ADP National Employment Report: Private Sector Employment Increased by 278,000 Jobs in May; Annual Pay was Up 6.5%

https://www.prnewswire.com/news-release ... 39975.html

ROSELAND, N.J., June 1, 2023 /PRNewswire/ -- Private sector employment increased by 278,000 jobs in May and annual pay was up 6.5 percent year-over-year, according to the May ADP National Employment Report produced by the ADP Research Institute in collaboration with the Stanford Digital Economy Lab ( "Stanford Lab" ).

The jobs report and pay insights use ADP's fine-grained anonymized and aggregated payroll data of over 25 million U.S. employees to provide a representative picture of the labor market. The report details the current month's total private employment change, and weekly job data from the previous month. ADP's pay measure uniquely captures the earnings of a cohort of almost 10 million employees over a 12-month period.

"This is the second month we've seen a full percentage point decline in pay growth for job changers," said Nela Richardson, chief economist, ADP. "Pay growth is slowing substantially, and wage-driven inflation may be less of a concern for the economy despite robust hiring."
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weatheriscool
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weatheriscool
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The case for a 2023 US recession is crumbling
https://www.cnn.com/2023/06/05/economy/ ... index.html
Many CEOs, investors and economists had penciled in 2023 as the year when a recession would hit the American economy.

The thinking was that the US economy would grind to a halt because the Federal Reserve was effectively slamming the brakes to squash inflation. Businesses would lay off workers and inflation-weary Americans would slash spending.

But the case for a 2023 US recession is crumbling for a simple reason: America’s jobs market is way too strong.

Hiring unexpectedly accelerated again last month, with employers adding an impressive 339,000 jobs in May. Not only is that more than any major forecaster expected, but it’s more jobs than the US economy added in any single month in 2019, a very strong year for the jobs market.

“This economy is incredibly resilient, despite all the slings and arrows – despite the banking crisis, rate hikes, the debt ceiling,” Mark Zandi, chief economist at Moody’s Analytics, told CNN in a phone interview on Friday.

Zandi is growing more confident that 2023 won’t be the year when a downturn will begin.

“For this year, given these jobs numbers, it’s hard to see a recession. Increasingly, the odds of a recession this year are fading,” Zandi said. “A lot of economists who have called for a recession are now in the uncomfortable position of pushing back the start date.”
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US applications for jobless benefits highest since October 2021
Source: ABC News

The number of Americans applying for unemployment benefits last week rose to its highest level since October 2021, but the labor market remains one of the healthiest parts of the U.S. economy.

The Labor Department reported Thursday that U.S. applications for jobless claims were 261,000 for the week ending June 3, an increase of 28,000 from the previous week's 233,000. Weekly jobless claims are considered representative of U.S. layoffs. The four-week moving average of claims, which evens out some of the weekly variations, rose by 7,500 to 237,250.

Despite last week’s sharp increase in filings for unemployment aid, some analysts cautioned against concluding that layoffs are picking up across the economy. They noted that the weekly figures are prone to revision and that last week’s numbers might have been distorted by the three-day Memorial Day weekend.

“The latest reading reflects a holiday-shortened week (Memorial Day), which ought to raise suspicions that the big move was more noise than signal,” said Stephen Stanley, chief U.S. economist for Santander. “I am eager to see next week’s reading before I draw any conclusions.”
Read more: https://abcnews.go.com/Business/wireSto ... 1-99929088
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weatheriscool
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Inflation rose at a 4% annual rate in May, the lowest in 2 years
Source: CNBC
The inflation rate cooled in May to its lowest annual rate in more than two years, likely taking pressure off the Federal Reserve to continue raising interest rates, the Labor Department reported Tuesday.

The consumer price index, which measures changes in a multitude of goods and services, increased just 0.1% for the month, bringing the annual level down to 4%. That 12-month increase was the smallest since March 2021, when inflation was just beginning to rise to what would become the highest in 41 years.

Excluding volatile food and energy prices, the picture wasn’t as optimistic.

So-called core inflation rose 0.4% on the month and was still up 5.3% from a year ago, indicating that while price pressures have eased somewhat, consumers are still under fire.
Read more: https://www.cnbc.com/2023/06/13/cpi-inf ... 2023-.html
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