Business Conditions

“Light-vehicle sales picked up in January. Component shortages are still restricting production, but assemblies, inventory, and prices may be starting to stabilize, albeit at extreme levels.” ~ Robert Hughes

“Job openings rose again while quits eased slightly but remain near record levels. The tight labor market continues to hamper production and sustain upward pressure on prices.” ~ Robert Hughes

“Expansion slowed a bit but remained strong for the manufacturing sector in January. Production issues continue to restrain supply and sustain upward pressure prices, but there may be early signs of progress on some issues.” ~ Robert Hughes

“Consumer sentiment weakened again in January as consumers reacted to Covid and high prices. Some easing of supply-chain issues, policy actions by the Fed, and consumer spending decisions will all contribute to the future pace of economic activity and price pressures.” ~ Robert Hughes

“New orders for core capital goods remained strong in December. Continued strength for business investment is a positive sign for the economic outlook.” ~ Robert Hughes

“Inventory accumulation boosted headline GDP growth while private domestic demand posted a modest gain. With continued pressure on prices, the Fed is moving to a tightening cycle, boosting the risk of a policy mistake.” ~ Robert Hughes

“Weekly initial claims for unemployment benefits fell back from a three-month high in the prior week and remain at a very low level by historical comparison. Most data suggest the labor market remains very tight.” ~ Robert Hughes

“New-home sales rose in December, but prices plunged, and months’ supply remains relatively high. Rising prices, higher mortgage rates, and continued inventory build may continue to weigh on price increases.” ~ Robert Hughes

“Consumer expectations weakened in January, pulling down overall consumer confidence. Continued expansion remains the likely course, but weaker consumer attitudes could become a headwind.” ~ Robert Hughes

“Existing-home sales fell sharply in December, but supply remains very tight. Shifting housing preferences and rising mortgage rates are likely to continue to impact demand over the coming months and quarters.” ~ Robert Hughes