Full text of National Economic Trends : November 2001
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November 2001 NationalEconomicTrends Ahead of the Curve Many analysts have concluded that the U.S. economy entered a recession in the last few months. The historical pattern is that the Federal Reserve reacts to a weakening economy with a lower target for its monetary policy instrument, the federal funds rate. This suggests that if a typical recession does unfold in the coming months, short-term interest rates will move considerably lower. But there is an important difference this time compared with the last recession, which ended more than a decade ago. The difference is that this time the Fed began lowering its target aggressively in January 2001, well before the onset of recession, whereas in the 1990-91 episode, the Fed was essentially on hold as the recession began and, indeed, until it was well underway. The Figure shows the Federal Open Market Committee’s (FOMC’s) target level for the federal funds rate, as a percentage of its initial level, nine months before and after July 1990, the official date for the beginning of the 1990-91 recession. (For example, 70 percent means that the target rate had fallen 30 percent from the level that prevailed nine months before the onset of recession.) For the current episode, no official beginning date has been established—and indeed there is still at least some possibility that no part of 2001 will be classified as a recession. But, for the purposes of discussion, let us suppose that a recession will eventually be dated as beginning in July 2001. The Figure indicates that the Fed was essentially on hold during the first six months of 1990 and remained committed to a pre-recession level of the target federal funds rate until October of that year, four months after the recession began. At that point, as it became clearer that a recession was underway, the Fed began lowering its target more aggressively. The target federal funds rate eventually reached a cyclical low of 3 percent by September 1992—27 months after the recession onset. In contrast, during the current episode, the Fed began an aggressive lowering of the federal funds rate target in January of this year, well before any likely beginning recession date and six months before the provisional date we have adopted for purposes of discussion. The Fed thus has taken a far more preemptive stance during the current period as compared with the 1990-91 period. What accounts for the difference in the two episodes? Probably the main difference is that inflation was kept under better control during the expansion of the late 1990s, whereas inflation had crept to unacceptably high levels during the late 1980s. The chain-type personal consumption expenditures price index rose at rates between 4 and 5 percent from the previous year during most of 1989 and 1990. The same index has risen at an annual rate of less than 1 percent during the first eight months of 2001. Low and relatively stable inflation has given the FOMC more room to lower its federal funds target than it had in 1990, when inflation was relatively high and rising. —James B. Bullard Federal Funds Rate Target (as a percentage of initial level) 120 100 October 1989-April 1991 80 60 October 2000-October 2001 40 20 0 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Recession Onset NOTE: End of month federal funds rate target set by the FOMC. Upper line represents rate relative to October 1989. Lower line represents rate relative to October 2000. SOURCE: Federal Reserve Board. Views expressed do not necessarily reflect official positions of the Federal Reserve System. w w w.stls.frb.org/research TableofContents Page 3 Economy at a glance 4 Output and growth 7 Interest rates 8 Inflation and prices 10 Labor markets 12 Consumer spending 14 Investment spending 16 Government revenues, spending, and debt 18 International trade 20 Productivity and profits 22 Quick reference tables 27 Notes and sources Conventions used in this publication: 1. Shaded areas indicate recessions, as determined by the National Bureau of Economic Research. 2. Percent change refers to simple percent changes. Percent change from year ago refers to the percent change from the same month or quarter in the previous year. The percent change at annual rate shows what the growth rate would be over an entire year if the same simple percent change continued for four quarters or twelve months. The percent change at annual rate of X between the previous quarter t –1 and the current quarter t is: 100 x [ ( XX ) t t –1 4 –1 ] For monthly data replace 4 with 12. 3. All data with significant seasonal patterns are seasonally adjusted, unless labeled NSA. National Economic Trends is published monthly by the Research Division of the Federal Reserve Bank of St. Louis. For more information on data, please call (314) 444-8573. Single-copy subscriptions are available free of charge by writing to the Public Affairs Office, Federal Reserve Bank of St. Louis, Post Office Box 442, St. Louis, MO 63166-0442 or by calling (314) 444-8808 or (314) 444-8809. Information in this publication is also included on the Federal Reserve Economic Data (FRED) electronic bulletin board at (314) 621-1824 or Internet World Wide Web server at http://www.stls.frb.org/fred. NationalEconomicTrends Real GDP Growth 11/02/01 Consumer Price Index Industrial Production Interest Rates Change in Nonfarm Payrolls Unemployment Rate Federal Reserve Bank of St. Louis NationalEconomicTrends 11/02/01 Real Gross Domestic Product Industrial Production and Purchasing Managers’ (NAPM) Indexes Aggregate Private Nonfarm Hours Real Change in Private Inventories Federal Reserve Bank of St. Louis NationalEconomicTrends 11/02/01 Real Final Sales and GDP Real GDP Revisions Industrial Production and NAPM Index Nominal Gross Domestic Product Aggregate Private Nonfarm Hours Average Weekly Private Nonfarm Hours Real Change in Private Inventories Inventory-Sales Ratio Federal Reserve Bank of St. Louis NationalEconomicTrends 11/01/01 Contribution of Components to Real GDP Growth Contributions to Real GDP Growth Rate 1999 4th 2000 1st 2nd 3rd 4th Federal Reserve Bank of St. Louis 2001 1st 2nd 3rd NationalEconomicTrends 11/02/01 Interest Rates Treasury Yield Curve Standard and Poor’s 500 Index with Reinvested Dividends Federal Reserve Bank of St. Louis NationalEconomicTrends 11/01/01 NIPA Chain Price Indexes Consumer Price Index Producer Price Index, Finished Goods Employment Cost Index and Compensation per Hour Federal Reserve Bank of St. Louis NationalEconomicTrends NIPA Chain Price Indexes 11/01/01 Crude Oil and Natural Gas Prices Consumer Price Index Consumption Chain Price Index Producer Price Index, Finished Goods Unit Labor Cost Employment Cost Index Compensation per Hour Federal Reserve Bank of St. Louis NationalEconomicTrends 11/02/01 Employment Unemployment, Labor Force Participation and Employment Rates Duration of Unemployment Federal Reserve Bank of St. Louis NationalEconomicTrends 11/02/01 Change in Nonfarm Payrolls Change in Manufacturing Payrolls Change in Household Employment Labor Force and Population Available Labor Supply and Components Unemployment Rate and Help-Wanted Advertising Index Federal Reserve Bank of St. Louis NationalEconomicTrends 11/01/01 Real Disposable Personal Income Real Consumption Retail and Food Services Sales Debt Service Payments as a Percent of Disposable Income and Household Debt Outstanding Federal Reserve Bank of St. Louis NationalEconomicTrends Real Disposable Personal Income 11/01/01 Personal Saving Rate Real Consumption Real Consumption Retail and Food Services Sales Real Durables Consumption and Vehicle Sales Consumer Sentiment (U. of Michigan) Real Durables Consumption Federal Reserve Bank of St. Louis NationalEconomicTrends 11/01/01 Investment Private Fixed Investment Real Nonresidential Fixed and Equipment & Software Investment Real Residential Fixed Investment Federal Reserve Bank of St. Louis NationalEconomicTrends 11/02/01 Gross Saving Rates and Net Foreign Investment Real Private Fixed Investment Nondefense Capital Goods Orders Real Equipment & Software Investment Real Nonresidential Fixed Investment Real Residential Fixed Investment Housing Starts and New Home Sales Federal Reserve Bank of St. Louis NationalEconomicTrends 11/01/01 Govt. Consumption and Investment Government Receipts and Outlays Government Budgets Unified Budget National Income Accounts State and Local Receipts Expenditures Federal Surplus or Deficit(-) Receipts Expenditures Federal Surplus or Deficit(-) Federal Reserve Bank of St. Louis Receipts Outlays Surplus or Deficit(-) NationalEconomicTrends 11/01/01 Federal Debt Federal Surplus (+) / Deficit (-) Change in Federal Debt Federal Surplus (+) / Deficit (-), Unified Basis Federal Government Debt Total Public Debt Held by Agencies and Trusts Total Federal Reserve Banks Federal Reserve Bank of St. Louis Total Foreign and International NationalEconomicTrends 11/01/01 Current Account, Trade and Investment Income Balances Exchange Rates Goods Export Shares, 2000 UK 5.38% All Other 22.78% Goods Import Shares, 2000 Mexico 14.42% UK 3.54% Mexico 11.10% China 8.17% China 2.10% Japan 8.41% Japan 11.96% All Other 26.00% Germany 3.81% France 2.64% Germany 4.78% France 2.43% Other OECD 17.29% Canada 23.17% Other OECD 13.16% Federal Reserve Bank of St. Louis Canada 18.85% NationalEconomicTrends 11/01/01 Trade Balance Goods Trade Current Account Balance Services Trade Real GDP Growth of Major Trading Partners United Kingdom Germany Canada France Japan Mexico Federal Reserve Bank of St. Louis NationalEconomicTrends 11/01/01 Output per Hour and Capacity Utilization, Manufacturing Nonfarm Compensation per Hour Output per Hour, Nonfarm Business and Nonfarm, Nonfinancial Corporations Federal Reserve Bank of St. Louis NationalEconomicTrends 11/01/01 Nonfarm Output per Hour Manufacturing Output per Hour Selected Component Shares of National Income Corporate Profits after Tax (with IVA and CCAdj) Federal Reserve Bank of St. Louis NationalEconomicTrends 11101101 NominalGDP Billions of $ 1997 1998 1999 2000 1998 1 2 Real GDP Percent chancje Annual Year rate ago 8318.4 8781.5 9268.6 9872.9 Final Sales Percent change Annual Year rate ago Billions of 1996 $ 6.5 5.6 5.5 6.5 8159.450 8508.933 8856.541 9223.994 Billions of 1996 $ 4.4 4.3 4.1 4.1 8095.204 8431 .826 8792.031 9167.025 Percent changa Annual Year rate ago Change in Private Invenlories Billions of 1996 $ Last qtr YearI~’earago 4.0 4.2 4.3 4.3 63.757 76.727 62.106 50.587 4 8627.8 8697.3 8816.5 8984.5 7.2 3.3 5.6 7.8 6.2 5.0 5.1 6,0 8396.345 8442.912 8528.466 8667.853 6.1 2.2 4.1 6.7 4.7 3.8 3.8 4.8 8286.592 8397.191 8454.942 8588.501 4.0 5.4 2.8 6.5 4.0 4.4 3.6 4.7 113.143 41.975 71.789 79.999 79.722 68.139 73.252 76.727 1 2 9093.1 9161.4 4.9 3.0 5.4 5.3 8733.483 8771.221 3.1 1.7 4.0 3.9 8651.156 8735.136 3.0 3.9 4.4 4.0 83.378 32.737 69.285 66.976 3 4 9297.4 9522.5 6.1 10.0 5.5 6.0 8871.464 9049.917 4.7 8.3 4.0 4.4 8825.577 8956.256 4.2 6.1 4.4 4.3 39.558 92.749 58.918 62.106 2000 1 2 9668.7 9857.6 6.3 8.0 6.3 7.6 9102.499 9229.385 2.3 5.7 4.2 5.2 9061.640 9148.501 4.8 3.9 4.7 4.7 28.917 78.942 48.490 60.042 3 9937.5 10027.9 3.3 3.7 6.9 5.3 9260.091 9303.923 1.3 1.9 4.4 2.8 9201.271 9256.687 2.3 2.4 4.3 3.4 51.725 42.765 63.083 50.587 10141.7 10202.6 10247.7 4.6 2.4 1.8 4.9 3.5 3.1 9334.472 9341.739 9333.378 1.3 0.3 —0.4 2.5 1.2 0.8 9347.828 9364.795 9365.184 4.0 0.7 0.0 3.2 2.4 1.8 —27.113 —38.287 —50.381 36.580 7.273 —18.254 3 1999 4 2001 1 2 3 Consumplion 1997 1998 1999 2000 1998 1 2 3 4 1999 1 2 3 4 2000 1 2 3 4 2001 1 2 3 DurablesConsump~on Billions of 1996 $ Percent chancie Annual Year rate ago 5423.902 5683.734 5968.444 6257.816 Private Fixed Investment Billions of 1996 $ Percent change Annual Year rate ago 3.6 4.8 5.0 4.8 657.347 726.658 817.834 895.529 4.2 Nonresidential Fixed Investment Billions of 1996 $ Percent change Annual Year rate ago Billions of 1996 $ Percent chancie Annual Year rate ago 6.6 10.5 12.5 9.5 1328.630 1479.986 1595.386 1716.207 9.6 11.4 7.8 7.6 1009.344 1135.921 1228.634 1350.670 12.2 12.5 8.2 9.9 7.0 16.6 4.2 24.0 8.0 13.1 8.4 12.7 1431.442 1471.449 1485.359 1531.720 18.7 11.7 3.8 13.1 12.2 12.2 9.5 11.7 1099.458 1132.260 1136.578 1175.370 21.6 12.5 1.5 14.4 14.4 14.1 9.6 12.3 5576.260 5660.165 571 3.745 5784.66 1 5.1 6.2 3.8 5.1 4.6 5.0 692.530 719.710 727.101 767.283 5853.953 5936.129 6000.026 6083.617 4.9 5.7 4.4 5.7 5.0 4.9 5.0 5.2 780.519 809.499 827.161 854.151 7.1 15.7 9.0 13.7 12.7 12.5 13.8 11.3 1558.242 1582.823 1610.836 1629.669 7.1 6.5 7.3 4.8 8.9 7.6 8.4 6.4 1192.630 1214.882 1244.626 1262.408 6.0 7.7 10.2 5.8 8.5 6171.712 6226.286 6292.122 6341 .092 5.9 3.6 4.3 3.1 5.4 4.9 4.9 4.2 892.126 886.460 904.104 899.419 19.0 —2.5 8.2 —2.1 14.3 9.5 9.3 5.3 1683.440 1719.215 1730.056 1732.106 13.9 8.8 2.5 0.5 8.0 8.6 7.4 6.3 1309.449 1347.656 1371.096 1374.460 15.8 12.2 7.1 1.0 9.8 10.9 10.2 8.9 6388.492 6428.402 6447.780 3.0 2.5 1.2 3.5 3.2 2.5 922.425 938.115 941.968 10.6 7.0 1.7 3.4 5.8 4.2 1740.340 1696.380 1659.502 1.9 —9.7 —8.4 3.4 —1.3 —4.1 1373.911 1320.925 1279.848 —0.2 —14.6 —11.9 4.9 —2.0 —6.7 5.3 Federal Reserve Bank of St. Louis 7.3 9.5 7.4 NationalEconomicTrends GDP Chain P~ceIndex Index 1997 1998 1999 2000 1998 1 2 ~ Annual rate 101.950 103.200 104.660 107.040 11101101 Employment Cost Index ECI: v/ages Year ago Index Percent change Annual Year rate ago 2.0 1.2 1.4 2.3 133.3 138.0 142.4 148.9 3.1 3.5 3.2 4.6 130.4 135.6 140.3 146.0 ECI: Benefits Index Percent change Annual Year rate ago Index Percent change Annual Year rate ago 3.5 4.0 3.4 4.1 140.2 143.6 147.6 156.0 2.1 2.4 2.8 5.7 102.760 103.020 103.380 103.660 1.1 1.0 1.4 1.1 1.4 1.2 1.2 1.1 136.2 137.3 138.8 139.7 3.0 3.3 4.4 2.6 3.5 3.5 3.8 3.3 133.7 134.8 136.5 137.5 4.0 3.3 5.1 3.0 4.0 3.9 4.3 3.9 142.2 143.1 144.1 145.1 1.1 2.6 2.8 2.8 2.4 2.4 2.6 2.3 3 4 104.100 104.450 104.810 105.280 1.7 1.4 1.4 1.8 1.3 1.4 1.4 1.6 140.2 141.8 143.0 144.6 1.4 4.6 3.4 4.6 2.9 3.3 3.0 3.5 138.1 139.7 140.9 142.3 1.8 4.7 3.5 4.0 3.3 3.6 3.2 3.5 145.3 146.7 148.2 150.2 0.6 3.9 4.2 5.5 2.2 2.5 2.8 3.5 2000 1 2 106.250 106.810 3.7 2.1 2.1 2.3 146.6 148.3 5.6 4.7 4.6 4.6 143.9 145.4 4.6 4.2 4.2 4.1 153.2 155.1 8.2 5.1 5.4 5.7 3 4 107.310 107.780 1.9 1.8 2.4 2.4 149.7 151.0 3.8 3.5 4.7 4.4 146.7 147.9 3.6 3.3 4.1 3.9 157.0 158.7 5.0 4.4 5.9 5.7 1 2 108.650 109.220 3.3 2.1 2.3 2.3 152.7 154.2 4.6 4.0 4.2 4.0 149.5 150.9 4.4 3.8 3.9 3.8 161.0 162.5 5.9 3.8 5.1 4.8 3 109.800 2.1 2.3 155.6 3.7 3.9 152.0 2.9 3.6 164.7 5.5 4.9 3 4 1999 1 2 2001 Expo~s 1997 1998 1999 2000 1998 1 2 Billions of 1996 $ Billions of 1996 $ 981.458 1002.420 1034.852 1133.204 12.3 2.1 3.2 9.5 1094.778 1223.500 1351.721 1532.260 NonfarmOutput per Hour Percent change Annual Year rate ago Nonfarm Compensatior~Hr Index Percent change Annual Year rate ago Index Percent change Annual Year rate ago 13.7 11.8 10.5 13.4 107.5 110.3 112.9 116.2 2.0 2.6 2.4 2.9 113.1 119.2 124.4 132.0 3.0 5.4 4.4 6.1 1003.364 993.110 987.612 1025.577 0.5 —4.0 —2.2 16.3 6.7 1.4 —1.7 2.3 1184.176 1216.171 1228.855 1264.818 15.9 11.3 4.2 12.2 14.5 12.6 9.4 10.8 109.6 109.7 110.4 111.6 4.5 0.4 2.6 4.4 3.2 2.2 2.0 3.0 116.9 118.5 120.0 121.2 6.8 5.6 5.2 4.1 4.6 5.6 5.9 5.4 1007.560 1018.015 1041.766 1072.056 —6.8 4.2 9.7 12.1 0.4 2.5 5.5 4.5 1290.592 1331.390 1375.106 1409.808 8.4 13.3 13.8 10.5 9.0 9.5 11.9 11.5 112.2 111.9 112.7 114.7 2.2 —1.1 2.9 7.3 2.4 2.0 2.1 2.8 122.3 123.6 125.1 126.4 3.7 4.3 4.9 4.2 4.6 4.3 4.2 4.3 4 1095.457 1130.581 1159.306 1147.470 9.0 13.5 10.6 —4.0 8.7 11.1 11.3 7.0 1466.565 1523.380 1570.554 1568.541 17.1 16.4 13.0 —0.5 13.6 14.4 14.2 11.3 114.5 116.3 116.7 117.4 —0.7 6.4 1.4 2.4 2.0 3.9 3.5 2.4 128.4 130.7 133.0 135.9 6.5 7.4 7.2 9.0 5.0 5.7 6.3 7.5 1 2 1144.061 —1.2 1108.299 —11.9 4.4 —2.0 1548.585 1515.039 —5.0 —8.4 5.6 —0.5 117.4 118.0 0.0 2.1 2.5 1.5 137.6 139.2 5.1 4.7 7.2 6.5 3 1059.040 —16.6 —8.6 1454.025 —15.2 —7.4 3 4 1999 1 2 3 4 2000 1 2 3 2001 lmpo~s Percent change Annual Year rate ago Federal Reserve Bank of St. Louis National EconomicTrends Household Survey Employment Thousands Change 11102101 Nonfarm Payroll Employment Percent change Annual Year rate ago Thousands Change Nonfarm AggregateHours Percent change Annual Year rate ago Index Percent chance Monthly Annual Year rate rate ago 2.4 1996 126720 1812 1.5 119589 2402 2.0 136.6 1997 129572 2852 2.3 122676 3087 2.6 141.4 3.5 1998 131471 1898 1.5 125845 3168 2.6 145.2 2.7 1999 133501 2030 1.5 128901 3056 2.4 148.4 2.2 2000 135215 1714 1.3 131757 2857 2.2 151.4 2.1 3 132923 133192 133627 632 269 435 1.9 0.8 1.3 1.7 1.5 1.6 127775 128503 129217 801 727 715 2.5 2.3 2.2 2.4 2.4 2.4 147.0 147.9 148.7 0.3 0.6 0.5 1.4 2.6 2.1 1.9 2.2 2.2 4 134263 636 1.9 1.5 130107 890 2.8 2.5 149.9 0.8 3.4 2.3 1 135036 774 2.3 1.6 130984 877 2.7 2.5 151.0 0.7 3.0 2.7 2 3 4 135181 135049 135593 145 —132 544 0.4 —0.4 1.6 1.5 1.1 1.0 131854 131927 132264 870 74 336 2.7 0.2 1.0 2.6 2.1 1.7 151.5 151.5 151.6 0.3 0.0 0.0 1.2 0.2 0.2 2.4 1.9 1.1 1 135865 272 0.8 0.6 132559 295 0.9 1.2 152.0 0.2 1.0 0.6 2 3 135130 134984 —735 —145 —2.1 —0.4 —0.0 —0.0 132483 132342 —76 —141 —0.2 —0.4 0.5 0.3 151.4 150.3 —0.4 —0.7 —1.5 —3.0 —0.0 —0.8 1999 Oct Nov Dec 134049 134241 134498 254 192 257 2.3 1.7 2.3 1.5 1.5 1.4 129863 130093 130365 453 230 272 4.3 2.1 2.5 2.5 2.5 2.4 149.6 149.9 150.2 0.6 0.2 0.2 7.5 2.4 2.4 2.3 2.5 2.2 2000 Jan Feb Mar 134976 478 4.3 1.5 130668 303 2.8 2.5 150.7 0.3 4.1 2.8 135120 135013 144 —107 1.3 —0.9 1.7 1.6 130843 131441 175 598 1.6 5.6 2.3 2.7 150.9 151.4 0.1 0.3 1.6 4.0 2.4 3.1 Apr May 135517 134843 504 —674 4.6 —5.8 2.0 1.2 131683 131909 242 226 2.2 2.1 2.6 2.7 151.8 151.1 0.3 —0.5 3.2 —5.4 2.8 2.2 Jun 135183 340 3.1 1.3 131969 60 0.5 2.5 151.5 0.3 3.2 2.2 Jul Aug 134898 134939 —285 41 —2.5 0.4 1.0 1.0 131899 131837 —70 —62 —0.6 —0.6 2.2 2.0 151.6 151.3 0.1 —0.2 0.8 —2.3 2.0 1.7 Sep 135310 371 3.3 1.1 132046 209 1.9 2.0 151.7 0.3 3.2 2.0 Oct 135464 154 1.4 1.1 132145 99 0.9 1.8 151.8 0.1 0.8 1.5 Nov 135478 135836 14 358 0.1 3.2 0.9 1.0 132279 132367 134 88 1.2 0.8 1.7 1.5 151.8 151.2 0.0 —0.4 0.0 —4.6 1.3 0.7 Feb 135999 135815 163 —184 1.4 —1.6 0.8 0.5 132428 132595 61 167 0.6 1.5 1.3 1.3 152.2 151.7 0.7 —0.3 8.2 —3.9 1.0 0.5 Mar 135780 —35 —0.3 0.6 132654 59 0.5 0.9 152.0 0.2 2.4 0.4 Apr May Jun 135354 135103 134932 —426 —251 —171 —3.7 —2.2 —1.5 —0.1 0.2 —0.2 132489 132530 132431 —165 41 —99 —1.5 0.4 —0.9 0.6 0.5 0.4 151.5 151.5 151.2 —0.3 0.0 —0.2 —3.9 0.0 —2.4 —0.2 0.3 —0.2 Jul Aug Sep 135379 134393 135181 447 —986 788 4.0 —8.4 7.3 0.4 —0.4 —0.1 132449 132395 132182 18 —54 —213 0.2 —0.5 —1.9 0.4 0.4 0.1 150.8 150.1 149.9 —0.3 —0.5 —0.1 —3.1 —5.4 —1.6 —0.5 —0.8 —1.2 Oct 134562 —619 —5.4 —0.7 131767 —415 —3.7 —0.3 148.8 —0.7 —8.5 —2.0 1999 1 2 2000 2001 Dec 2001 Jan Federal Reserve Bank of St. Louis National Economic Trends 11102101 Rethil and Food Services Sales Unempl. Rate Billions of dollars 5.4 5.0 4.5 4.2 4.0 2638.816 2769.378 2906.996 3146.523 3385.615 5.8 4.9 5.0 8.2 7.6 119.556 127.586 133.669 139.203 146.989 1 4.3 761.800 2.0 8.4 7.4 136.506 1.0 2 3 4.3 777.546 2.1 8.5 7.2 138.137 1.2 4 4.2 4.1 794.178 812.999 2.1 2.4 8.8 9.8 9.4 8.9 140.114 142.056 1.4 1.4 1996 1997 1998 1999 2000 1999 2000 lndusfrial Production Percent chance Monthly! Annual Year quarterly rate ago Index Percent chance Monthly! Annual Year quarterly rate ago Treasury Yields 3—mo 10—yr 4.6 6.7 4.8 4.1 5.6 5.01 5.06 4.78 4.64 5.82 6.44 6.35 5.26 5.64 6.03 3.9 3.3 4.41 4.98 4.9 3.8 4.45 5.54 5.8 5.7 4.4 5.1 4.65 5.04 5.88 6.14 6.48 1 4.0 839.058 3.2 13.5 10.1 144.365 1.6 6.7 5.8 5.52 2 4.0 842.109 0.4 1.5 8.3 147.130 1.9 7.9 6.5 5.71 6.18 3 4.0 4.0 851.995 1.2 4.8 7.3 148.406 0.9 3.5 5.9 852.453 0.1 0.2 4.9 148.055 —0.2 —0.9 4.2 6.02 6.02 5.89 5.57 1 2 4.2 3 4.8 863.401 874.458 872.178 1.3 1.3 —0.3 5.2 5.2 —1.0 2.9 3.8 2.4 145.481 143.868 141.581 —1.7 —1.1 —1.6 —6.8 —4.4 —6.2 0.8 —2.2 —4.6 4.82 3.66 3.17 5.05 5.27 4.98 1999 Oct 4.1 267.076 0.4 5.0 8.1 141 .481 0.8 9.7 4.4 4.86 6.11 Nov 4.1 270.712 1.4 17.6 8.8 141.879 0.3 3.4 5.1 5.07 6.03 Dec 4.1 275.211 1.7 21.9 9.7 142.808 0.7 8.1 5.7 5.20 6.28 2000 Jan 4.0 275.864 0.2 2.9 9.6 143.569 0.5 6.6 5.6 5.32 6.66 Feb Mar 4.1 4.0 279.909 283.285 1.5 1.2 19.1 15.5 10.0 10.8 144.291 145.234 0.5 0.7 6.2 8.1 5.9 5.8 5.55 5.69 6.52 6.26 Apr Jun 4.0 4.1 4.0 279.961 280.447 281.701 —1.2 0.2 0.4 —13.2 2.1 5.5 8.9 7.9 8.1 146.266 147.228 147.896 0.7 0.7 0.5 8.9 8.2 5.6 6.4 6.4 6.7 5.66 5.79 5.69 5.99 6.44 6.10 Jul Aug Sep 4.0 4.1 3.9 283.035 282.905 286.055 0.5 —0.0 1.1 5.8 —0.5 14.2 7.8 6.5 7.5 147.595 148.650 148.973 —0.2 0.7 0.2 —2.4 8.9 2.6 5.7 6.0 6.1 5.96 6.09 6.00 6.05 5.83 5.80 4 2001 May 4.5 Oct 3.9 285.070 —0.3 —4.1 6.7 148.660 —0.2 —2.5 5.1 6.11 5.74 Nov Dec 4.0 4.0 283.648 283.735 —0.5 0.0 —5.8 0.4 4.8 3.1 148.206 147.300 —0.3 —0.6 —3.6 —7.1 4.5 3.1 6.17 5.77 5.72 5.24 2001 Jan Feb 4.2 288.054 1.5 19.9 4.4 4.2 4.3 288.245 287.102 0.1 —0.4 0.8 —4.7 3.0 1.3 146.013 145.443 144.987 —0.9 —10.0 —0.4 —4.6 —0.3 —3.7 1.7 0.8 —0.2 5.15 4.88 4.42 5.16 5.10 4.89 4.5 4.4 4.5 291.116 291.691 291.651 1.4 0.2 —0.0 18.1 2.4 —0.2 4.0 4.0 3.5 144.607 144.227 142.771 —0.3 —3.1 —0.3 —3.1 —1.0 —11.5 —1.1 —2.0 —3.5 3.87 3.62 3.49 5.14 5.39 5.28 292.228 0.2 2.4 3.2 Sep 4.5 4.9 4.9 293.435 286.515 0.4 —2.4 5.1 —24.9 3.7 0.2 142.689 141.754 140.300 —0.1 —0.7 —0.7 —7.6 —1.0 —11.6 —3.3 —4.6 —5.8 3.51 3.36 2.64 5.24 4.97 4.73 Oct 5.4 2.16 4.57 Mar Apr May Jun Jul Aug Federal Reserve Bank of St. Louis NationalEconomicTrends 11/01/01 Consumer Price Index less Food and Energy Consumer PriceIndex Index 1996 1997 1998 1999 2000 1999 1 2 Percent change Monthly! Annual Year quarterly rate ago 157.0 160.6 163.1 166.7 172.3 Year to date 2.9 2.3 1.5 2.2 3.4 Index Percent chance Monthly! Annual Year quarterly rate ago 165.8 169.7 173.6 177.2 181.5 Producer Pñce Index Finished Goods Year to date 2.7 2.4 2.3 2.1 2.4 Index Percent chance Monthly! Annual Year quarterly rate ago 131.3 131.8 130.7 133.0 138.0 2.6 0.4 —0.9 1.8 3.7 164.9 166.0 167.2 168.5 0.4 0.7 0.7 0.8 1.6 2.9 2.8 3.2 1.7 2.1 2.3 2.6 1.6 2.2 2.4 2.6 175.9 176.8 177.6 178.7 0.5 0.5 0.5 0.6 1.9 1.9 1.9 2.4 2.2 2.1 2.0 2.0 1.9 1.9 1.9 2.0 131.4 132.3 133.6 134.8 0.3 0.7 1.0 0.9 1.2 2.8 4.0 3.7 0.7 1.3 2.3 2.9 1.0 0.7 0.9 0.7 4.2 3.0 3.5 2.9 3.3 3.3 3.5 3.4 4.2 3.6 3.6 3.4 179.8 181.0 182.1 183.2 0.6 0.7 0.6 0.6 2.6 2.7 2.5 2.4 2.2 2.4 2.6 2.5 2.6 2.6 2.6 2.5 136.3 3 4 170.3 171.5 173.0 174.3 137.5 138.4 139.8 1.1 0.9 0.7 1.0 4.4 3.6 2.6 4.1 3.7 3.9 3.6 3.7 1 2 3 176.1 177.4 177.7 1.0 0.8 0.2 4.2 3.1 0.7 3.4 3.4 2.7 4.2 3.6 2.6 184.6 185.8 187.0 0.8 0.6 0.6 3.2 2.6 2.5 2.7 2.7 2.7 3.2 2.9 2.8 141.6 142.1 140.9 1.3 0.4 —0.9 5.3 1.4 —3.4 3.9 3.4 1.8 1999 Sep 167.8 0.4 5.1 2.6 2.7 178.0 0.3 3.4 2.1 1.8 134.5 0.7 8.4 3.1 Oct Nov 168.2 168.5 0.2 0.2 2.9 2.2 2.6 2.6 2.7 2.7 178.3 178.7 0.2 0.2 2.0 2.7 2.1 2.1 1.8 1.9 134.6 134.7 0.1 0.1 0.9 0.9 2.7 3.0 Dec 168.9 0.2 2.9 2.7 2.7 179.0 0.2 2.0 1.9 1.9 135.2 0.4 4.5 3.0 2000 Jan 169.4 0.3 3.6 2.8 3.6 179.4 0.2 2.7 2.0 2.7 135.1 —0.1 —0.9 2.6 Feb Mar 170.2 171.2 0.5 0.6 5.8 7.3 3.3 3.8 4.7 5.6 179.7 180.3 0.2 0.3 2.0 4.1 2.2 2.4 2.4 2.9 136.3 137.5 0.9 0.9 11.2 11.1 4.0 4.6 Apr May 171.1 171.3 —0.1 0.1 —0.7 1.4 3.1 3.2 4.0 3.4 180.7 181.0 0.2 0.2 2.7 2.0 2.3 2.4 2.9 2.7 137.1 137.1 —0.3 0.0 —3.4 0.0 3,7 3.6 Jun 172.2 0.5 6.5 3.7 3.9 181.3 0.2 2.0 2.5 2.6 138.3 0.9 11.0 4.5 Jul Aug 172.7 172.8 0.3 0.1 3.5 0.7 3.6 3.4 3.9 3.5 181.7 182.1 0.2 0.2 2.7 2.7 2.5 2.6 2.6 2.6 138.2 138.0 —0.1 —0.1 —0.9 —1.7 4.1 3.3 Sep 173.6 0.5 5.7 3.5 3.7 182.6 0.3 3.3 2.6 2.7 139.0 0.7 9.1 3.3 3 4 2000 2001 1 2 Oct 173.9 0.2 2.1 3.4 3.6 182.8 0.1 1.3 2.5 2.6 139.6 0.4 5.3 3.7 Nov 174.3 0.2 2.8 3.4 3.5 183.3 0.3 3.3 2.6 2.6 139.8 0.1 1.7 3.8 Dec 174.6 0.2 2.1 3.4 3.4 183.5 0.1 1.3 2.5 2.5 140.0 0.1 1.7 3.6 2001 Jan Feb 175.7 176.2 0.6 0.3 7.8 3.5 3.7 3.5 7.8 5.6 184.1 184.7 0.3 0.3 4.0 4.0 2.6 2.8 4.0 4.0 141.6 141.7 1.1 0.1 14.6 0.9 4.8 4.0 Mar 176.3 0.1 0.7 3.0 4.0 185.1 0.2 2.6 2.7 3.5 141.6 —0.1 —0.8 3.0 Apr 176.8 177.5 177.9 0.3 0.4 0.2 3.5 4.9 2.7 3.3 3.6 3.3 3.8 4.0 3.8 185.5 185.7 186.3 0.2 0.1 0.3 2.6 1.3 3.9 2.7 2.6 2.8 3.3 2.9 3.1 142.3 142.4 141.7 0.5 0.1 —0.5 6.1 0.8 —5.7 3.8 3.9 2.5 177.4 —0.3 —3.3 2.7 177.5 178.2 0.1 0.4 0.7 4.8 2.7 2.6 2.8 2.5 2.8 186.6 187.0 187.4 0.2 0.2 0.2 1.9 2.6 2.6 2.7 2.7 2.6 2.9 2.9 2.8 140.4 140.9 141.4 —0.9 —10.5 0.4 4.4 0.4 4.3 1.6 2.1 1.7 May Jun Jul Aug Sep Federal Reserve Bank of St. Louis Notes Pages 4, 5: Final sales is gross domestic product (GDP) minus change in private inventories. Advance, preliminary, and final GDP growth rates are released during the first, second, and third months of the following quarter. Changes result from incorporation of more complete information. Real GDP is measured in 1996 dollars. The Purchasing Managers’ Index is a weighted average of diffusion indexes for new orders, production, supplier deliveries, inventories, and employment. Aggregate and average weekly hours are paid hours of production and nonsupervisory employees. The inventory-sales ratio uses nominal (current-dollar) inventory and sales data. Page 6: For information on how to calculate the contribution of a component to the overall GDP growth rate, see the October 1999 issue of the Survey of Current Business, p. 16. The sign is changed for imports. Page 7: Ten-year Treasury yields are adjusted to constant maturity. Three-month yields are secondary market averages, but all rates used in the yield curves are adjusted to constant maturity. Standard and Poor’s 500 Index with Reinvested Dividends shows the total return: capital gains plus dividends. Pages 8,9: Oil (West Texas intermediate) and Natural Gas (Henry Hub) prices are monthly averages of daily spot prices listed in the Wall Street Journal. Consumer price index is for all urban consumers. The consumption chain price index is the index associated with the personal consumption expenditures component of GDP. The Employment Cost Index (ECI) covers private nonfarm employers. ECI compensation refers to a fixed sample of jobs, while compensation per hour covers all workers in the nonfarm business sector in a given quarter. In both cases, compensation is wages and salaries plus benefits. Pages 10,11: Nonfarm payroll employment is counted in a survey of about 390,000 establishments (Current Employment Survey). It excludes self-employed individuals and workers in private households, but double-counts individuals with more than one job. The household survey (Current Population Survey) of about 50,000 households provides estimates of civilian employment, unemployment rate, labor force participation rate, and employment-population ratio. Population is civilian, noninstitutional, 16 years and over. 90 percent confidence intervals for the unemployment rate (± 0.2 percentage points) and change in household survey employment (± 376,000) measure uncertainty due to sample size. The available labor supply is the sum of the unemployed and those persons not in the labor force but who want to work now. The household survey was significantly changed in January 1994, so care should be exercised in making short-term comparisons around this date, particularly with the duration data shown on page 10. Pages 13: The Michigan consumer sentiment index shows changes in a summary measure of consumers’ answers to five questions about their current and expected financial situation, expectations about future economic conditions, and attitudes about making large purchases. The survey is based on a representative sample of U.S. households. Pages 14, 15: Overall gross saving includes government saving, which is the sum of the government surplus and capital consumption (see notes for pages 16 and 17). Net foreign investment (NFI) is U.S. investment abroad minus foreign investment in the U.S. Aside from a statistical discrepancy, NFI also equals the difference between gross domestic investment and saving. The comprehensive revision introduced the equipment & software component of business investment. Pages 16, 17: Government consumption and investment is current expenditures on goods and services, including capital consumption (depreciation) and gross investment, as reported in the NIPAs. The unified federal budget surplus/deficit differs from NIPA basis in four main ways: (1) NIPA excludes transactions involving existing assets; (2) NIPA outlays exclude government investment and include consumption of government capital, while unified budget outlays do the reverse; (3) NIPA accounts exclude Puerto Rico and U.S. territories; and (4) various timing issues are handled differently. Outlays and receipts are from the NIPAs, except as noted. Since 1977, the federal fiscal year starts on October 1. Excluded agency debt was 0.6 percent of federal debt at the end of fiscal 1997. Federal debt held by the public includes holdings of the Federal Reserve System and excludes holdings of the social security and other federal trust funds. Federal grants in aid to state and local governments appear in both state and local receipts and federal outlays. Pages 18, 19: The trade balance (shown on a balance of payments basis) is the difference between exports and imports of goods (merchandise) and services. It is nearly identical in concept to the net exports component of GDP, but differs slightly in accounting details. The investment income balance equals income received from U.S.owned assets in other countries minus income paid on foreign-owned assets in the U.S. The investment income balance is nearly identical in concept to the difference between gross national product and gross domestic product, but differs in accounting details. The current account balance is the trade balance plus the balance on investment income plus net unilateral transfers to the U.S. from other countries. Pages 20, 21: Output per hour (Y/H), unit labor cost (C/Y), and compensation per hour (C/H) are indexes which approximately obey the following relationship: %(Y/H) + %(C/Y) = %(C/H) with %() meaning percent changes. Unit labor cost is shown on page 9. Real compensation per hour uses the CPI to adjust for the effects of inflation. Nonfarm business accounted for about 76 percent of the value of GDP in 1996, while nonfinancial corporations accounted for about 54 percent. Inventory valuation adjustments (IVA) remove the effect of changes in the value of existing inventories from corporate profits and proprietors’ income. (This change in value does not correspond to current production and therefore is not part of GDP). Capital consumption adjustments (CCAdj) increase profits and proprietors’ income by the difference between estimates of economic depreciation and depreciation allowed by the tax code. Components of national income not shown are rental income of persons and net interest. NOTE: Measures of retail sales (pp. 12-13), manufacturers’ orders, shipments and inventories (p. 15), and the total business inventory-tosales ratio (p. 5) are now based on the North American Industry Classification System (NAICS). Data from January 1992 onward are on a NAICS basis, while data before that are on the old Standard Industrial Classification (SIC) system. For more information, see http://www.census.gov/epcd/www/naics.html Sources Bureau of Economic Analysis (BEA), U.S. Dept. of Commerce National income and product accounts, international trade and investment data (except by country), auto and light truck sales Census Bureau, U.S. Dept. of Commerce Inventory-sales ratios, retail sales, capital goods orders, housing starts, exports and imports by country Bureau of Labor Statistics (BLS), U.S. Dept. of Labor All employment-related data, employment cost index, consumer and producer price indexes, unit labor cost, output per hour, compensation per hour, multifactor productivity United States Department of Treasury Unified budget receipts, outlays, deficit, debt Federal Reserve Board Index of industrial production, treasury yields, exchange rates, capacity utilization, household debt The Survey Research Center, The University of Michigan Consumer sentiment index The Conference Board Help-wanted advertising index Organization for Economic Cooperation and Development (OECD) GDP for major trading partners (not available on FRED)
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