Outlook For US Economy Still Underwater

Tag : Lead Wires



The Conference Board's composite of forward looking economicindicators is once again looking for the world's largest economy tocontract through the second half. The report's June reading crossedthe wires with a negative 0.1 percent reading - indicating anegative outlook for growth over the coming three to six months.Adding to the disappointment from the deata, the previous month'soriginal positive reading was revised down to negative 0.2 percent.With these two contractions, nine of the past 12 months have failedto see growth for the US. These dour readings are far fromsurprising however considering the oppressive heights in energy andfood prices, the plunge in consumer confidence and rise inunemployment rate among other factors. Such concerns were clearlyreflected in the indicator's breakdown. Consumer expectations fellfor the fifth consecutive month, jobless claims deteriorated andorders tappered off. The greatest negative influences however camefrom stock prices and the money supply - figures not necessarilyreflective of trends in consumption or production. Making apositive impact for the month were - surprisingly enough - consumergoods orders (rising for the first time this year), diliveries andbuilding permits. Altogether, this data merely sustains fears thatan ongoing housing recession and full turn in consumer spendingwill lead the economy into a potential recession. - John Kicklighter, Currency Analyst for DailyFX.com