Sep 30, 2020 - Economy & Business

Real-time data show economy's rebound slowing but still going

Data: New York Fed; Chart: Axios Visuals
Data: New York Fed; Chart: Axios Visuals

The New York Fed's index of real-time data reversed again in the last week, with data continuing to show a slow but recovering economy that is having trouble returning to its pre-pandemic strength.

What happened: The index was unexpectedly weaker given solid data on U.S. retail sales and the massive outperformance of the Conference Board's consumer confidence index.

  • The index had ticked up to -3.84% last week, and the latest decline for the week of Sept. 26 comes "in spite of increases in retail sales, steel production, and consumer confidence," the index's authors say.
  • The index was at -4.5% after its previous update on Thursday.

What it is: "The Weekly Economic Index is an index of 10 daily and weekly indicators of real economic activity, scaled to align with the four-quarter GDP growth rate," per the New York Fed.

The big picture: Other real-time data backs the stall out in the New York Fed's data.

  • TD Securities analysts note that the daily Homebase employment series now shows a small decline in not-seasonally-adjusted private payrolls in September and points to a decline in jobs for October.
  • The OpenTable restaurant series "has been volatile, but it appears to be trending up slowly," they note.
  • The analysts expect a positive jobs number in the September jobs report, but only 400,000 jobs added, which would be less than half the consensus expectation of 850,000, according to FactSet.

A similar measure of real-time data from Jefferies rose in the last week, but remains below its September peak, as the month-over-month growth rate "has averaged at just 1.5% over the past month, the slowest pace since the beginning of the recovery."

  • Though analysts caution the September slowdown is likely based on seasonal factors, "i.e., not yet a concern."
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