Get ready, this is one of those “green shoots” posts. There’s some fairly good data here that at least argues the recession is running out of steam.
First, on the jobs front, initial claims were up 3,000 to 608,000 but the more reliable four-week moving average fell by 7,000 to 615,700. Since April the four-week average is down by 40,000. Total unemployment fell by 148,000 to 6.76 million. [NYT]
Next, the Conference Board’s index of leading economic indicators was up 1.2% in May after an upward revision to 1.1% for April. When you start seeing positive revisions that’s generally a good sign. The May increase is the largest since a 1.4% increase in March 2004. [Reuters]
Finally, Philly Fed survey of economic activity rose significantly from minus 22.6 in May to minus 2.2 in June. Both new orders and the employment gauge were at their highest levels since last September and November of last year respectively. To be sure, the reading still indicates contraction but just barely. [Reuters]
I know, I know a few data points do not a recovery make. But, these are fairly significant data points and taken with what we’ve seen over the last few months, it’s becoming pretty clear that there is a turn occurring. Whether that turns into a full blown recovery is very much up in the air. There is a lot that can go wrong and if you read this blog often, you know that I just see all of this as an upward leg on a recession (maybe something worse) that has multiple years to run.
But enjoy the good news while you can.