The US economy appears to be making a more robust comeback than expected, as retail spending, employment, and manufacturing all post strong gains.
Thursday’s onslaught of data showed that the US economy is faring a lot better than previously anticipated, as numerous sectors have returned to, or exceeded pre-pandemic levels. The rebound in demand was attributed to business openings across the country in March, the rapid vaccine rollout, and the $1,400 stimulus checks distributed to qualifying individuals.
Retail sales rose by 9.8% in March, marking the second-highest jump on records dating back to 1992. All 13 categories posted gains that exceeded February 2020 pre-pandemic levels, with the exception of restaurants. Receipts at restaurants increased by 13.4% last month, while apparel retail sales rose by 18.3%. Sales at gas stations grew 10.9%, largely due to higher fuel prices. Despite the ongoing global semiconductor shortage, sales at car and motor vehicle parts dealers jumped by 15.1%.
Thursday was also a big day for US economy in terms of the manufacturing sector, as the index for current manufacturing activity increased from a revised print of 44.5 to 50.2 in April— the highest reading in almost 50 years. Nearly 59% of the survey’s respondents reported higher activity levels this month, with only 8% reporting declines.
In the meantime, initial jobless claims declined from 769,000 to 576,000 for the week ending on April 10. Although still significantly elevated relative to pre-pandemic levels, first-time applications for unemployment benefits have hit their lowest in 13 months.
Although the federal government’s stimulus payments provided a significant boost in spending, their long-term impact is unknown. Economic data over the next several months will determine whether or not there was momentous job growth, and if consumer confidence continues to remain elevated.
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Information for this briefing was found via the DOL, Philadelphia Fed, and the US Census Bureau. Thee author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
