Weekly Economic Update
December 19, 2011
JOBLESS CLAIMS FALL TO 3½-YEAR LOW
Last Thursday, the Labor Department announced that 366,000 Americans filed initial jobless claims in the week ending December 10, the lowest weekly figure since March 2008. This was a drop of 19,000 from the preceding week and refuted the expectations of some economists. This may be a sign that the jobless rate, currently at 8.6%, could be poised to fall further.1
Last Thursday, the Labor Department announced that 366,000 Americans filed initial jobless claims in the week ending December 10, the lowest weekly figure since March 2008. This was a drop of 19,000 from the preceding week and refuted the expectations of some economists. This may be a sign that the jobless rate, currently at 8.6%, could be poised to fall further.1
HAS INFLATION PEAKED?
The federal government’s Consumer Price Index was flat in November after a 0.1% retreat in October. While core inflation rose 0.2% last month, the Federal Reserve now expects 1.7% inflation across 2012 compared to a projected 2.8% for 2011. Producer prices were up 0.3% in November; core PPI advanced 0.1%. The year-over-year rise in wholesale prices was 5.7%, the smallest 12-month gain since March.2,3
The federal government’s Consumer Price Index was flat in November after a 0.1% retreat in October. While core inflation rose 0.2% last month, the Federal Reserve now expects 1.7% inflation across 2012 compared to a projected 2.8% for 2011. Producer prices were up 0.3% in November; core PPI advanced 0.1%. The year-over-year rise in wholesale prices was 5.7%, the smallest 12-month gain since March.2,3
RETAIL SALES RISE 0.2% in NOVEMBER
While many economists hoped for a bigger advance, the November increase marked the sixth straight monthly gain for the indicator. Lower gas prices may have left consumers with greater discretionary funds: on Friday, AAA said a gallon of regular unleaded averaged $3.25 nationally, 18.4% below a peak hit in early May.2,4
While many economists hoped for a bigger advance, the November increase marked the sixth straight monthly gain for the indicator. Lower gas prices may have left consumers with greater discretionary funds: on Friday, AAA said a gallon of regular unleaded averaged $3.25 nationally, 18.4% below a peak hit in early May.2,4
GOLD & OIL TAKE A HIT
Gold lost a whopping 6.93% last week; oil fell 5.49%. Gold settled at $1,597.90 on the COMEX and oil closed Friday’s NYMEX trading day at $93.87.2
Gold lost a whopping 6.93% last week; oil fell 5.49%. Gold settled at $1,597.90 on the COMEX and oil closed Friday’s NYMEX trading day at $93.87.2
STOCKS PULL BACK Citing “the absence of a credible financial backstop” in the EU debt crisis, Fitch Ratings downgraded France Friday and placed the credit ratings of Spain and Italy on review. It was a wan note to end a rough week, as these numbers point out: DJIA, -2.61% to 11,866.39; S&P 500, -2.83% t0 1,219.66; NASDAQ, -3.46% to 2,555.33.2,5,6
THIS WEEK: No major U.S. economic releases are scheduled for Monday. On Tuesday, we learn about November housing starts and earnings reports arrive from Nike, Oracle, ConAgra and General Mills. Wednesday brings the NAR report on November existing home sales plus earnings out of CarMax, Bed Bath & Beyond and Walgreen’s. Thursday we get the final December consumer sentiment survey from the University of Michigan, the Conference Board’s LEI for November, initial claims numbers and the final 3Q GDP estimate from Washington. Friday brings three big reports: November new home sales, durable goods orders and consumer spending.
% CHANGE
|
Y-T-D
|
1-YR CHG
|
5-YR AVG
|
10-YR AVG
|
DJIA
|
+2.50
|
+3.19
|
-0.93
|
+2.00
|
NASDAQ
|
-3.68
|
-3.11
|
+0.80
|
+2.86
|
S&P 500
|
-3.02
|
-1.87
|
-2.91
|
+0.75
|
REAL YIELD
|
12/16 RATE
|
1 YR AGO
|
5 YRS AGO
|
10 YRS AGO
|
10 YR TIPS
|
-0.05%
|
1.15%
|
2.29%
|
3.50%
|
Sources: money.msn.com, bigcharts.com, treasury.gov, treasurydirect.gov - 12/16/112,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.
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