Introducing

Robert Brusca

Robert A. Brusca is Chief Economist of Fact and Opinion Economics, a consulting firm he founded in Manhattan. He has been an economist on Wall Street for over 25 years. He has visited central banking and large institutional clients in over 30 countries in his career as an economist. Mr. Brusca was a Divisional Research Chief at the Federal Reserve Bank of NY (Chief of the International Financial markets Division), a Fed Watcher at Irving Trust and Chief Economist at Nikko Securities International. He is widely quoted and appears in various media. Mr. Brusca holds an MA and Ph.D. in economics from Michigan State University and a BA in Economics from the University of Michigan. His research pursues his strong interests in non aligned policy economics as well as international economics. FAO Economics’ research targets investors to assist them in making better investment decisions in stocks, bonds and in a variety of international assets. The company does not manage money and has no conflicts in giving economic advice.

Publications by Robert Brusca

Global| Nov 12 2024
ZEW Current Conditions Deteriorate in Europe; Improve in the U.S.
ZEW current economic conditions deteriorate in Europe and improve in the United States in November. Expectations drop for Germany but rise in the U.S.

Remarkable shifts- The U.S. shows two remarkable shifts as U.S. inflation expectations moved from -36.7 in October to +2.7 in November, the second sharpest change in the history of the U.S. series exceeded only by the shift that occurred post-covid in March 2022. U.S. macroeconomic expectations also shifted sharply to +13.3 in November from -8.2 in October. That shift is the 14th largest in the history of that series. Both of these series have a history of nearly 33 years.

Survey BEFORE the U.S. elections finds firmness- The strength of the U.S. shift is impressive; it comes for a survey conducted BEFORE the U.S. presidential elections but after the Fed began its easing campaign. U.S. inflation expectations are still low at the November reading, which has a 23-percentile ranking. But now macroeconomic expectations have risen above their median (above a ranking of 50%) for a standing in their 61.4 percentile. U.S. current conditions have improved slightly in the month as well, rising to a net positive reading of 27.2 with a month-to-month rise of about 3 points to a standing at its 45.2 percentile, a bit short of its historic median at a diffusion value of 29.3.

Normalcy ahead for U.S./not so for Europe- The U.S. survey is climbing back into the normal zone whereas Europe and Germany are weak and getting weaker. In the case of Germany, the economic situation erodes to -91.4 in November from -86.9 in October, falling to a 4.1 percentile standing. That bad combination represents a significant month-to-month drop to an extremely weak level. The U.S. and Europe are in very different circumstances and apparently in different phases of their business cycles as well. Despite the ECB cutting rates, Germany is sinking, and Europe’s politics also are frayed. German expectations are still deteriorating in November and demonstrate half the ranking for U.S. expectations. Inflation expectations in Germany and in the euro area improved somewhat in November.
by:Robert Brusca
|in:Economy in Brief
Global| Nov 08 2024
IP Is Mixed across EMU in September
Industrial production in September was mixed across the 12 early reporting members of the European Monetary Union (EMU). Output fell on the month in Ireland, the Netherlands, Germany, Greece, France, and Finland, a diverse group of EMU members. At the same time, output was reported stronger in Spain, Portugal, Malta, Belgium, Italy, and Austria. The median change in September was for a decline of 0.2 percentage points; that fall follows a median change of zero in August versus an increase of 0.5% in July.

Looking over broader periods from 12-months to six-months to three-months, median output falls over 12 months by 0.5%, it falls by 2.2% over six months, and it falls by 0.5% over three months. The medians of the annual rate changes over those various periods remain consistently negative.

Over 12 months compared to 12-months ago, output is accelerating in 77.8% of the reporters. However, over six months compared to 12-months, output accelerates in only 38.5% of the reporters. Over three months compared to six-months, output accelerates in 55.6% of the reporters. While the statistics on acceleration are mixed, there seems to be more of a tendency for output to accelerate than to decelerate over these various timelines. The monthly data similarly show mixed statistics on output acceleration month-to-month for September, August, and July.

By country, output is accelerating over the three sequential broad periods in Austria and in Spain. However, sequentially, output is decelerating in Germany, the Netherlands, Malta, and Greece.
by:Robert Brusca
|in:Economy in Brief
Germany| Nov 07 2024
German IP Sinks in September
German industrial output fell by 2.5% in September. Output decline for consumer goods, capital goods, and intermediate goods. The September drops follow broad-based increases in August that followed widespread and deep declines in July.

Sequentially, output falls 4.6% over 12 months; it falls at a 7.9% annual rate over six months and drops at a 10.7% annual rate over three months. The various sectors generally follow the headline pattern revealing progressively falling output across manufacturing sectors from 12-months to 6-months to 3-months.

The construction sector also is showing steady declines and declines that are getting sequentially larger over shorter periods (persistent deceleration).

In contrast, real manufacturing orders are showing growth and acceleration sequentially. Real manufacturing sales also ‘go their own way’ declining on all horizons without any clear change in speed.

Surveys of the German manufacturing sector were mixed in September compared to August. Survey values in September are generally below their July levels. Average levels of the surveys have generally showed some modest improvement from their 12-month averages to their three-month averages.

France, Spain, Portugal, and Norway are early reports of IP data along with Germany. Spain and Portugal show output increases in September, while there are declines in France and Norway. Sequential trends among these countries are chaotic except for Spain that shows clear sequential output acceleration.

The just-completed third quarter shows declines- negative output growth rates and weakening survey metrics with few exceptions. The exceptions are real orders that rose strongly in Q3 (17.5% annual rate). Output in France and in Norway also showed increases in the third quarter.

However, we also rank all of these metrics on growth rates or levels as appropriate. Only Portugal and Norway have indicators that are above their medians on growth rates calculated over 24 years. German output is in its lower 9-percentile. Real manufacturing sales are at their 11th percentile. But orders are doing better; real German orders, an important forward-looking series, has a 46.2 percentile standing, still below its historic median, but getting closer to the median that occurs at a ranking of 50%.
by:Robert Brusca
|in:Economy in Brief
Global| Nov 06 2024
Composite PMIs from S&P Improve
In October, only six reporters saw their composite PMI measures weaken compared to September. Two of those were large EMU economies, France and Spain. But in the EMU, there still was improvement compared to September. The U.S, U.K., and EMU average has the same reading value as in September. The overall average improved in October to 51.9 from 51.4 in September. The median overall reading also improved to 51.8 from 50.0. Still, there is a net decline for the overall average and median compared to August values. Some improvement month-to-month but not much overall: a one-month improvement, a two-month decline.

Sequentially, looking at average levels, over three months, six months and 12 months, there is little volatility in these readings. The average over three months is slightly stronger than the 12-month average while the median is slightly weaker over three months compared to 12-months.

The queue percentile standings tell a story of ongoing weakness. The standing of the average is at the 49.2 percentile, nearly on top of its four and one half year average. The median value is at its 48.3 percentile. Again, these two measures are below their respective multi-month medians but are also quite near to those medians. The BRIC countries (I exclude Russia so its actually a reading for the BICs) average is at a 69% standing.

There are 13 of 25 reporting jurisdictions that have a queue standing below their medians (below 50%). Among the 12 reporters whose standings are above 50%, the average standing is 64.1%. Among those below 50% the average standing is 35.4%. Interestingly, the performing economies have about 14 percentage points above their median while those that were not performing average about 14 percentage points below their medians.
by:Robert Brusca
|in:Economy in Brief
Global| Nov 05 2024
OECD LEIs Global Expansion Still Broadly Underway
The OECD leading economic indicators normalized or amplitude adjusted uniformly show that expansion is still underway in the global economy. The OECD-7 metric is up by 0.1% in September for the normalized leading indicators after being flat in August. There are positive expansions indicated over 12 months, six months, and three months. Apart from looking at growth rates, the level of the indicator for the OECD 7 has a 55.8 percentile standing, placing it above its historic median value. For the core group of OECD countries, expansion remains firmly signaled underway, even if not strongly.

The normalized indicator for Japan is flat in September after being flat in August. It shows a decline over 12 months but net increases over six months and three months with a queue percentile standing on the index at 50.7% which barely puts Japan over its median and puts it into growth territory; however, it does stay in growth territory slightly above median growth.

For the United States, the change in the normalized leading indicator in September is zero after zero in August as well. The U.S. has an increase of 0.1% over 12 months; it increases to 0.3% at an annual rate over three months and six months, hardly strong readings. However, the queue standing on the LEI level for the United States has a 57.2 percentile standing, a solid standing, clearly above the historic median (at a 50% standing) and clearly putting the United States into growth territory.

The OECD likes to look at six-month changes in its metrics. The second panel of this table looks at the changes in six-month averages month-to month and the net change over six months over progressive 6-month periods. On this score, we see September and August expansions in the OECD-7 grouping as moderate and consistent increases in September and August. For Japan, there are small consistent increases; from the United States strong increases in September and August. China logs two severe monthly declines. However, over broader periods based on six-month changes, we see increases logged even for China. The exception is having a decline from 6-months ago in Japan in its six-month change. Turning to the queue percentiles where we rank the different regions or countries on six-month growth rates, the OECD 7, Japan, and the U.S. have percentile standings in a range of 55% to 65% clearly above their historic medians while China comes in with a standing at its 39th percentile below its historic median.

The bottom panel of the chart shows the amplitude adjusted leading indicators from the OECD and here we look at the levels of the indicators with levels above 100 indicating normal to above normal growth and levels below 100 indicating below normal or below average growth. We see negative scores for France, Italy, Spain, and China consistently over the last four months. The ratio of the current index to six-months ago provides a negative reading for Spain and for China. The other metrics in the table signal ongoing expansion in the United States, the United Kingdom, Japan, the OECD 7, and Germany. These are relatively broad readings indicating continuity and global growth. However, the growth rates aren't particularly strong. For example, the German index has only at 50.7 percentile standing, the same as Japan's. These are razor edges standings, barely above their historic medians but again signaling growth but growth that is above the historic median value by only a small margin. The OECD 7 has a standing at its 55.8 percentile. Italy, France, and the United States have readings that are in their 57th percentile, again, relatively firm above their historic medians. For now, the strongest reading is coming from the U.K. with a 93.5 percentile standing. Spain and China both have percentile standings below their 50th percentile and are at the mid-30th percentile mark.
by:Robert Brusca
|in:Economy in Brief
Global| Nov 04 2024
MFG PMIs from S&P Stagnate
On the month, 7 of 18 countries reported weaker manufacturing PMI results than they had the month before. However, the median on a month-to-month basis didn't change at all. Sequentially looking at averages over 12 months, six months and three months, we see the median hasn't changed very much across that span either. It has stayed just below the value of 50, which indicates unchanged output, oscillating between values of 49.6 and 49.7. That's a great deal of consistency for these averages over these three different multi-month segments. All this as global trade growth has come to a halt according to the Baltic trade volume index.

The bottom line is that there isn't really a lot of trend in these overall data and the conditions of economic weakness remain in force although it's weakness of the mildest sort, technically below the value of 50 but - for the most part – these are numeric figures that would round up to a value of 50!

The queue percentile standings show that among these 18 observations, only 6 have values above their historic medians; that would refer to any queue percentile standing value of about 50%. The average percentile standing across all 18 reporting units is at 48.6, again fairly close to breakeven; however, the median value is only at 36.8% - the median is significantly weaker than the average.

As a group, the strongest reporters are the ‘BRIC’ reporters, with queue percentile standings at 54.4% for China, 35.1% for Russia, 73.7% for India, and 61.4% for Brazil. The weakest reporters in the table are Turkey at a 7% standing, France at a 17.5 percentile standing and Indonesia and a 19.3 percentile standing.

Looking at changes since January 2020 when COVID began to emerge, ten of the 18 reporters have even weaker values today than they had in January 2020 while the strongest reporters are Russia 2.7 points higher, India 2.2 points higher, and Brazil 1.9 points higher. No other country has a gain relative to January 2020 any stronger than 0.7 points.

Looking at the breadth of improvement, 66.7% improving compared to where they were 12-months ago; we see 38.9% improving over six months compared to over 12 months and 27.8% improving over three months compared to six months ago. This trend is unnerving, showing smaller, and smaller, proportions of reporters that are doing better than they had been doing over the previous period. And this is not good news even though the diffusion median value hasn't changed very much nor have the various period averages.
by:Robert Brusca
|in:Economy in Brief
Europe| Nov 01 2024
EMU Unemployment Is Still at a Low Level and Easing
Unemployment remains low in the euro area in September. It is tied for its all-time record low since the union was formed. So, the ranking of the rate is in its 0.3-percentile that says it has been this low or lower only 0.3% of the time. That is much lower than for any EMU member in the table. The lowest ranking (highest standing) in the table is Italy at 1.6% followed by Ireland at 7.4%. The reason the EMU rate ranks so much lower is that it is the confluence of all these low unemployment rates that is unusual making the EMU-wide rate even lower.

Trends The sequential trends from 12-month to 6-months to 3-months shows five of 12 countries in the table with falling rates of unemployment. Only four show unemployment falling on balance over six months with one having unemployment unchanged. Five have unemployment unchanged over three months as well. This shows the trend for unemployment rate to fall is still in place and that may seem surprising given the weakness in some of the recent economic data from Europe. Of course, one reason for this is also that Europe’s large economy Germany has its unemployment rate rising over 12 months and six months and it is on a different trend that the EMU area- that seems unsustainable.

Over the most recent three months, we see the unemployment rate falls in six countries month-to-month in August compared to only three in September. September has five countries with the unemployment rate rising that compares to only three in August.

The labor market trends may be running out of gas as far as lowing the unemployment rate is concerned. Still, the ECB is still cutting rates to provide economic support. But the labor trend does not show decay sequentially. The annualized monthly drops are all in the same ballpark for 12-month, 6-month, and 3-month changes. But the situation with Germany needs to be resolved since it will be hard for the euro area to perform well if Germany can’t.
by:Robert Brusca
|in:Economy in Brief
Europe| Oct 31 2024
Oil Drives EMU Inflation for the Target as the Core Gets Sticky
Inflation in the European Monetary Union turned flat in September with the headline flat and the core flat month-to-month. Over 12 months, headline inflation is rising at a 1.7% annual rate, the same as over six months; over three months, that pace steps down to 1.6%. Headline inflation is across the board consistent with the European central bank’s target of inflation of around 2%. Core inflation is higher. Over 12 months, the core runs hot at a 2.8% pace, rising over six months at a stronger 3.2% annual rate and then dipping to a 2.3% annual rate over three months. The three-month pace is coming much closer to the ECB's target for inflation.

The four largest economies in the EMU also had inflation fall in September. In Germany, prices dropped by 0.2%, the same as in Spain. Headline prices fell 0.7% in France and just ticked lower by 0.1% in Italy. Price dropping across the board is a special sign; in this case, it signals dropping oil prices.

Sequential inflation rates for headline inflation in large economies also are looking good. Germany and Spain have the highest 12-month inflation rates at 1.7%. France is next at 1.4% and then Italy logs a 0.7% 12-month inflation rate. However, over six months, inflation picks up above target for Italy and Germany to 2.7%; it cruises at a 1.9% annual rate in France and at 1% annual rate in Spain. Over three months, prices are flat in Germany, rising at a 0.2% annual rate in France, rising at a 0.3% annual rate in Spain, and rising at a 2.3% annual rate in Italy. The results we see for headline inflation clearly echoed across the large economies of the European Monetary Union.

However, as having been the case for some time, the sticking point for inflation is the core. This is because Brent oil prices fell by 8.1% in September and fell by 7.6% in August after rising by 0.1% in July. In fact, Brent oil prices are falling to a 47.7% annual rate over three months, falling at a 29.3% annual rate over six months, and falling at a 24% annual rate over 12 months. This helps to explain why headline inflation is doing so well. Core inflation is showing more signs of being stuck at a too-high level.

Core (ex-energy) inflation in the case of Germany is at a 2.6% annual rate over 12 months. Spain’s core pace is at a 2.4% annual rate, Italy logs a 1.9% annual rate, and France checks in at a 1.5% annual rate. For France and Italy, core inflation over 12 months is very much in the fold of the target pace, while in the case of Spain and Germany, the departures aren't so great as they both hover around 2.5% at an annual rate. However over six months, German inflation is still up by 2.4%, the same as in Italy. Spain logs in at a 2.2% annual rate. France stays with the low 1.5% annual rate. Over three months, inflation runs at a 2.8% annual rate for ex-energy in Germany; it's at a 2.4% annual rate for the core in Spain and 2.1% for the core in Italy, compared to an even weaker 0.4% annual rate in France.

Even with core inflation getting stuck in the EMU economy overall at 2.8%, inflation is still not very far from the ECB's goal and is broadly behaving for the large economies. And if economic data are deemed weak enough, inflation doesn't seem to be that far from the ECB's target nor is it misbehaving enough to keep ECB rate cuts off the table.
by:Robert Brusca
|in:Economy in Brief
Europe| Oct 30 2024
EMU GDP Estimate and Early Reporters Show Some Life
GDP growth in the European Monetary Union advanced by 1.5% in the third quarter at an annual rate, an acceleration from the second quarter’s 0.8% rise. It compares to gain of 1.2% at an annual rate in the first quarter. It is also the strongest quarterly rise since an increase of 2.4% at an annual rate in the third quarter of 2022. The year-over-year change is a gain of 0.9%, compared to 0.6% in the second quarter. That is the strongest year-over-year gain since the first quarter of 2023 when GDP rose by 1.4% year-over-year.

There are seven early reporting EMU members. Among these seven, four showed GDP advancing at a stronger pace in Q3 (Q/Q) than in Q2. Weaker growth was registered by Belgium and Italy with Portugal’s growth unchanged quarter-to-quarter.

Over the last six months, the large EMU economies have been holding back overall growth. The four largest EMU economies saw growth advance by 1.1% at an annual rate in 2024-Q3 compared to 2.5% growth in the rest of the EMU. In the second quarter, growth among the largest four economies also trailed growth in the rest of the monetary union. This is a switch from the usual standard. But year-on-year growth in the smaller economies is also higher in Q3 than in the largest four economies although that is the reverse of the previous three quarters.

Growth in the region has been weak for some time. The ranking of year-over-year growth rates on data back to 1997 shows all early reporting EMU members have rankings of growth in Q3 (year-on-year growth) below their historic medians (below a ranking of 50%) except Portugal and Spain. Portugal and Spain are exceptions with year-on-year growth rates that rank above 50% as well as above the ranking of the United States.

In the third quarter, only Italy has a negative quarter-to-quarter growth rate. Over four-quarters, only Germany and Ireland have negative quarter-to-quarter growth rates. Germany that does not have two quarters of negative (quarterly) growth back-to-back in the last three quarters has five consecutive quarters of negative year-over-year growth! However, the growth decline on this timeline has been modest. For Germany, this has been much more a period of pronounced economic stagnation than of economic decline.

Since 2011, the U.S. has had averages GDP growth about one percentage point (annualized) faster than the EMU. Since 2021, that difference has been the same on year-over-year comparisons, but it has become larger favoring the U.S. on quarterly comparisons. The median growth rate among early EMU reporters ranks at 40.2% while EMU growth ranks lower at 32.6% largely because the slower growing large economies have a greater weight in the EMU GDP construction than in the calculation of the median.
by:Robert Brusca
|in:Economy in Brief
Germany| Oct 29 2024
German Consumer Climate Improves But Is Still Quite Weak
Germany's consumer climate measure for November from GfK rose to -18.3 form -21.0 in October. Despite improvement, the index had been as week as -18.6 as recently as August 2024. The climate gauge, despite improving, has a queue standing among all its historic values that places it in the bottom 12% of all past monthly results. The climate gauge is for November while the component values for the index are for October. The components were mixed with the economic expectations gauge weakening while income expectations improved along with the buying propensity index. The components ranked higher than the GfK index, with economic expectations ranked at their 35th percentile; income expectations are nearly neutral, ranked at their 47.5 percentile and the propensity to buy at its 31.9 percentile. Economic reading for the Germany economy has remained weak; Germany's PMI readings have eroded, but slowly, with manufacturing diffusion weak, logging a value of 40 and services just above its neutral level at 50.6. The consumer climate reading ranks as weak and ranked over the last four-and-one-half years. Germany’s manufacturing sector ranks as lower only 8% of the time while service has been weaker only 40% of the time. The economy clearly has a burden of weakness and is not showing much lift or support for the consumer sector. Meanwhile, the ECB’s rate cut process has stalled or at least slowed.

Consumer readings for Europe from fellow EMU members Italy and France as well as for the United Kingdom show weak results. These readings are up to date on the same timeline as GfK components, as of October. All of them weaken by small amounts month-to-month. However, they rank higher than the GfK German climate index. Italy’s consumer confidence measure has a 77.1 percentile standing on the same timeline as Germany’s GfK. France has a 51.5 percentile standing. The U.K. is below its median for that same period with a standing at its 33.2 percentile, in the lower one-third of its queue of data.
by:Robert Brusca
|in:Economy in Brief
United Kingdom| Oct 28 2024
U.K. Distributive Trades Readings Weaken and Outlook Weakens
The distributive trades survey shows weakening in October for the retail sales (Yr Ago) and sales (time of year). Wholesale sales weakened for sales (Yr Ago) and remained at a very weak reading for orders (Yr Ago) as Sales (time of year) got marginally better in the month-to-month reading but remains at a very weak level.

Expectations for November weakened across the board in retailing compared to October. For wholesaling, they were nearly the same, with the expectations with the net negative readings in November for sales (time of year) that improved compared to October, but it still logged a very weak reading. Improvments month-to-month are a technical assessment, not a statement of an ongoing trend.

Retailing’s reported (current) results log net negative readings for nearly all observations except stocks over the last three months. Retail expectations are the same except their lone positive reading is near-term for October.

Wholesaling reported trends are uniformly deteriorating through time. The negative readings become increasingly weak – or become more severely weak and stay there. Expectations for wholesaling do not follow suit. They are more erratic and cannot be categorized as trending. However, what is disturbing about the expectations is that readings have become suddenly weaker over the last month or last two months in the case of sales (time of year).

Current conditions are generally stronger than their 12-month averages for retailing and weaker for wholesaling. But expectations are strikingly weaker in comparison with their 12-month averages for wholesaling while they are mixed on that comparison for retailing.

There is nothing strong in this month’s survey – not even ‘firm.’ Nothing reassuring. These monthly comparisons of stronger and weaker are only to assess where things are trending – very short term. The readings per se are weak - uniformly weak. All readings rank below their respective 50% mark that designates the location of the median. The strongest reading among activity variables, setting aside stocks, is the October standing of reported orders (compared to a year ago) at 42%. The 29% reading for retailing under expectations also for sales (compared to a year ago) is the next strongest reading.

Expectations are weaker in terms of rankings than the current (reported) readings. The difference is much larger for retailing than for wholesaling. But all the rankings are weak. The chart shows that readings are languishing in a morass of weakness after a post-covid rebound. There is not any clear road to better times ahead here.
by:Robert Brusca
|in:Economy in Brief
Denmark| Oct 23 2024
Danish Consumer Confidence Backtracks
Danish confidence sank further in October, falling to -8.9 after registering -6.8 in September. September had been a small improvement from August at -7.4 but now confidence has dipped below its August value. Confidence was last weaker in December of last year.

Inflation concerns are beginning to rise in Denmark as well. Inflation expectations that rose sequentially over the last 12 months are once again rising sequentially as we look ahead to the next 12 months.

Monthly trends The financial situation has eroded steadily over the last 12 months and continues to erode with the October reading, falling to -1 after posting +2.9 in September and +3.2 in August; this is small but steady slippage.

The outlook or assessment for the general economy has slipped over the last three months, but looking ahead at prospects for the general economy there is a small improvement but the last three monthly values are all net negative values and there doesn't seem to be any strength in that assessment. That conclusion is further underscored by unemployment trends that have worsened sharply over the last three months, with an August reading of plus 5 followed by a September reading of 9.5 and an October rating of 10.2; concerns about unemployment have risen.

The assessment of the environment monthly shows little change in the favorability of the time to purchase goods, with consistent negative readings over the last three months; the favorability looking forward to the next three months slips with October falling to -8 after having negative readings in the minus 5 region in both August and September. The general financial situation of households, however, does show some snail’s pace improvement, with the August reading of 24.8 moving up to 26.3 in September and moving up further to 26.9 in October.

Sequential trends Danish confidence is not improved very much sequentially although it's made a very small improvement from a -7.9 12-month average to an average of -7.7 over three months. The present situation improved over the last 12 months, with the last three-month assessment at -6.8 compared to a 12-month average of -9.3; there was still slippage compared to six months ago. The assessment of financial situation looking ahead, while positive, shows a decreasing positive value; a 12-month average is 3.5 with a three-month average slipping to 1.7. The assessment of the general economy sequentially looking backward had slipped over the last 12-to-six-to-three months; looking ahead that slippage continues as the 12-month average of -6.1 moves to -6.9 over six months and the average drops further to -9.0 over three months. As noted above, the outlook for inflation had been worsening and it continues to worsen even more sharply for the 12-months ahead. Unemployment expectations had improved sequentially from 9.3 over 12 months to 7.7 over six months and 8.2 over three months – but the monthly pattern unwinds the sequential trend.

The favorability of the environment to purchase is becoming progressively less negative sequentially. The favorability to purchase envisioned over the next 12 months has continued that progression with very small improvements. The three-month pattern that shows an increase in the general financial situation of households has extended this broader progression from 12-months to six-months to three-months that has generally been improving but has been improving slowly and actually saw a slight setback in the three-month to six-month progression.

Rankings for readings The rankings of these assessments are predominantly weak with the consumer confidence indicator weaker only 10.6% of the time. The financial situation over the last and the next 12 months both have rankings below their 10th percentiles. The general economy looking ahead has a ranking in its 15.5 percentile. The outlook for inflation over the last 12 months was high at its 89th percentile; over the next 12-months its standing is lower but is still high at a 79th percentile. The unemployment trends over the next 12 months have a 73.3 percentile standing, relatively high and well above the median which occurs at a ranking of 50 percent. The environment shows the favorability of the time to purchase is weak with a 15.2 percentile standing. Looking ahead, that improves but only slightly to a 20.6 percentile standing. The favorability of the time to save both currently and looking ahead has a 53-percentile standing, moderate, and slightly above average. Meanwhile, the general financial situation of households comes in above its median with a 60.3 percentile standing and logs the brightest reading in the table – although a 60-percentile standing is not particularly strong.
by:Robert Brusca
|in:Economy in Brief