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

Europe| Oct 02 2024
Unemployment Realities Strike in EMU
There is still a great deal of growth pessimism about prospects in Europe. The August unemployment data, however, make it unquestionably clear that the labor market continues to perform quite well. The unemployment rate in August for the European Monetary Union (EMU) stood at 6.4%, same as its level in July. The unemployment rate continues to sit at its historic low.

Still more unemployment progress that regress Scanning the unemployment rates for 12 of the longest standing European Monetary Union members as of August, unemployment rates month-to-month fell in six of them, while unemployment rates rose in only three of them. Labor market progress is still more widespread than labor market backtracking in the European Monetary Union. Unemployment rates in August fell in Finland, Italy, Spain, Ireland, Greece, and Portugal. Unemployment rates rose in August in Austria, Luxembourg, and the Netherlands. EMU-wide the number unemployed continues to fall.

We can also rank unemployment rates in their historic queue of data back to 1994. On this basis among the 12 monetary union members in the table, only two of them are above their historic medians. The medians in terms of ranked data occur at the 50th percentile mark. Luxembourg has an unemployment rate that ranks in its 85.5 percentile; Austria has an unemployment rate that ranks in its 60.5 percentile. All the rest of the country-level unemployment rates rank below their 50th percentile, with the highest ranking among the remaining countries being Finland where the unemployment rate stands at its 39th percentile, still well below its historic median. Germany, that has been in the news for unemployment slippage and economic weakening, has a 19.5% ranking in its unemployment rate – that is in the bottom 20-percentile of its historic queue of ranked data. The bottom line for the European Monetary Union is that the labor market is still quite solid and although there are concerns about weakness and perhaps concerns that the European Central Bank needs to cut interest rates more rapidly, the ECB is paying attention to inflation being over the top of its 2% target and at the same time it is looking at unemployment in the EMU that is tied for its all-time record low rate since the monetary union was formed.
by:Robert Brusca
|in:Economy in Brief
Japan| Oct 01 2024
Tankan Shows Steady MFG Reading in Q3
Japan’s Tankan for 2024-Q3 scored a +13.0 for large manufacturing firms, the same as in Q2. Large manufacturing firms are the bellwether reading for this survey. However, there also was an improvement for nonmanufacturing firms in Q3.

There is also a look ahead reading for Q4 in the survey. Again, on this basis, the large manufacturers log a reading of +14, the same as in Q3. Nonmanufacturers show a one-point improvement in their outlook.

The percentile standing data show large manufacturers have a 69.3 percentile standing in Q3. Nonmanufacturing firms are stronger with a 98.7 percentile standing. The outlook shows manufacturing firms at a 76-percentile standing with nonmanufacturing firms at a 100% percentile range standing – at their strongest standing on data back to 2006.

Across the various detailed nonmanufacturing sectors, six of these sectors have rankings in their 90th percentile. The sector, taken as a whole, has a 97.1 percentile standing. Personal services have a ranking only in its 50.7 percentile. Construction has a 65.3 percentile standing.

None of the Tankan sector readings are weak. The industry series are essentially at their medians or better- personal services is essentially a median reading. All nonmanufacturing industries except wholesaling and personal services are above their respective one-year averages. Manufacturing also is above its one-year average.
by:Robert Brusca
|in:Economy in Brief
Europe| Sep 30 2024
Early Inflation Readings in Large EMU Economies Show Promise
Inflation charts an uncertain path in the European Monetary Union (EMU). Early-reporting large countries are reporting weak inflation readings for their headlines in September. Three of the four largest EMU economies Germany, France, and Spain report declines in their headline HICP indexes in September. The exception, Italy, reports a headline that's unchanged month-to-month. That’s a “good news” month for headline inflation in no uncertain terms. These numbers follow an August in which two of these countries also had posted headline price declines and where one of them had posted an unchanged index month-to-month. These excellent results for August and September followed July that had been a difficult one with three of the member countries posting month-to-month increases in the headline HICP's ranging from 0.4% to 0.8% month-to-month.

We also have early reporting results on core inflation or (in the case of Germany) for inflation excluding energy for three of these reporters. Here the results are good but not excellent because the German figure shows an increase of 0.3% month-to-month, Italy logs a core index that is unchanged, while Spain logs a core that's down by 0.1%.

Headline HICP- As tantalizing as these figures are, they produce a mixed picture on sequential inflation when we look at the longer inflation picture from 12-months to six-months, to three-months. On the 12-month basis, all the headline readings for these four countries are below 2% which is the target number for the European Central Bank. However, over six months, inflation in Italy runs at a 2.8% pace, in Germany it runs at a 2.7% pace, while in France inflation accelerates but only to a 2.0% pace. Over three months, again headline inflation settles down with three of the four countries showing an annual rate of inflation over three months of a half a percent or less, but with Italy showing an annual rate at 2.6%. These are good results for the headline, with three-month inflation largely behaving and 12-month inflation, the usual preferred gauge of the central bank, below 2% across the board.

Core CPI- The problem emerges when we start to look at core inflation and we realize that a lot of this inflation progress has come because of weak oil prices. We have ex-energy or core inflation for Germany, Italy, and Spain and two of those three countries have year-over-year inflation rates on the core or ex-energy basis that are above 2%. German ex-energy inflation comes in at 2.6% over 12 months, Spanish core inflation comes at 2.4%, while Italian core inflation comes in just under the wire at 1.9%. Over six months, inflation accelerates in Italy from its 12-month pace of 1.9% to 2.4%. In Germany, ex-energy inflation ticks down to 2.4% over six months, while Spanish core inflation also ticks down to run at a 2.2% annual rate over six months. All the readings are above a 2% at an annual rate over six months. But over three months, Italy logs a pace for core inflation that's just barely excessive at 2.1%. Spanish inflation runs back up to a 2.4% annual rate over three months, the same as its year-over-year core. In Germany, ex-energy inflation jumps to 2.8% over three months, stronger than its six-month pace, or its 12-month pace.

Core inflation is still too-high- Headline inflation from the monetary union is certainly encouraging. However, looking a little bit deeper at core inflation which excludes the volatile food & energy components, we see inflation under the surface is continuing to percolate at a slightly excessive pace. The bad news is that inflation is slightly excessive on a relatively broad basis judging from these three economies. On the other hand, while it might be broadly excessive, it is not significantly excessive. Among all these inflation rates, the highest is over three months and it's Germany's ex-energy gain at 2.8%.
by:Robert Brusca
|in:Economy in Brief
United Kingdom| Sep 27 2024
U.K. Distributive Trades Show Improved Retailing and Sagging Wholesaling
The U.K. distributive trades picture in September shows sales compared to a year ago moving into a positive reading of +4 in September after logging a -27 reading in August – a sharp turnaround. For wholesale trades, September continues to deteriorate with the September reading on sales compared to a year ago at -8, slightly weaker than the -7 reading in August. Other retail readings are also on an improving trend in September compared to August while for wholesale trades the evidence is of deterioration in September compared to August. These two key distributive trades sectors are not moving in tandem. And that phenomenon also holds for the look-ahead survey that samples expectations for October. Expected sales volumes in retailing in October compared to September have moved up to a +5 in October compared to -17 for September; for wholesaling, the October expectation for sales compared to a year ago is -6 compared with September's expectation of +6. Other expectations for October compared to September show improvements in retailing compared to further deterioration in wholesaling, further underscoring that these two sectors are experiencing very different trends. If there is incipient strength coming to retail, it has not percolated down to wholesaling yet.

Retailing The retail readings since September show improvement in sales compared to a year ago, orders compared to a year ago, and for sales evaluated for the time of year. The stock-sales ratio also moves up in September compared to August. The rankings for these September values show that sales compared to a year ago have a 44.4 percentile standing, orders compared to a year ago have a 24.6 percentile standing, and sales for the time of year have a 36.6 percentile standing. All of these are below the 50-percentile mark and therefore all reside below their historic medians. The stock-sales ratio has 66.2 percentile standing and is above its historic median. While showing monthly improvement, retail remains weak.

Expectations for October find sales compared to a year ago, orders compared to a year ago, and sales for ‘the time of year’ all improved compared to what had been expected in September. However, only sales compared to a year ago have a net positive reading. Again, the stock-sales ratio has a positive value that moves up to a reading of 20 in October from 18 in September. The rankings for these expectations are similar to the rankings for the currently reported counterparts of these indicators. Expected sales compared to a year ago have a 40-percentile standing, expected orders compared to a year ago have a 29.1 percentile standing, and expected sales for the time of year compared to a year ago have a 29.8 percentile standing. The expected stock-sales ratio has a very high 89.5 percentile standing. The readings are not strong, but they do show improvements in September and expected improvements for October and therefore they do represent some progress. However, the absolute readings for sales and expectations both are subpar.

Wholesaling Wholesaling shows deterioration in September compared to August for sales compared to a year ago, for orders compared to a year ago, and for sales for the time of year; the stock sales ratio moves up and has a positive reading. With all negative readings up and down the line, the stock-sales ratio would seem to be indicating an undesired increase in stocks relative to sales. The rankings for these measures are weaker than the counterpart rankings for retailing. And like the retailing rankings, the rankings for the stock-sales ratio was the highest.

Looking at expectations for October, again we see deterioration for all the metrics for wholesale sales compared to a year ago, for expected orders compared to a year ago, and for expected sales for the time of year. While they all deteriorate in October compared to September, they're roughly in line with or better than the surveyed numbers that had been reported for August. Once again, the stock-sales ratio is positive and moves up in October compared to September and once again the rankings for these expected readings are weaker than the retail sales counterpart expectations for the same measures.
by:Robert Brusca
|in:Economy in Brief
Germany| Sep 26 2024
German Consumer Climate Remains Weak- A Slight Oct. Improvement Is Mooted
Since late-2022 the German GfK measure of consumer climate has improved but has been doing so very slowly and in fits and starts. Climate improved sharply from the end of 2022 until early to mid-2023 but the sharp rise did not go on for long. Afterwards some slight erosion took place. However, near the end of 2023, there was another step up as an improvement in German climate began. Since that point, confidence has remained steady in the region of about -21 or so (a weak level) in terms of the climate headline from GfK. More recently, economic expectations have logged some fresh erosion after having a similar path and moderate rebound.

Even so, the statistics on the GfK readings are clear. Climate is at the bottom 10% of all ranked historic readings. Economic expectations, income expectations, and the propensity to buy, are the three components that lag the GfK headline by a month. Their observations through September show economic expectations at a 37-percentile standing, the propensity to buy at a 30-percentile standing, and income expectations at a 44-percentile standing. Income expectations have clawed their way higher to stand near neutrality, as the median for ranked statistics -on any measure- occurs at a ranking at the 50th percentile mark. Income expectations are coming the closest to being back at neutral although they still fall short. The propensity to buy, at the 30% ranking mark, is still substantially short of neutrality, and the same is true of economic expectations with roughly a 37-percentile standing. But overall economic climate is in much worse shape than the components on the comparison of standings. The headline GfK reading is much weaker than any average of the ranking for its components. That is not unusual because historically the average component rank only explains about 60% of the variability in the ranking of climate.

GfK components The GfK components show improvement in train as of September for the propensity to buy measure and for income expectations while economic expectations are faltering and weakening. However, the GfK component improvements where they exist are only month-to-month. All three components are weaker compared to two months ago and two of three are net weaker compared to three months ago.

Elsewhere in Europe Other European confidence measures are up-to-date only through September, like the GfK components. Italy and France show solid month-to-month improvements in September confidence while the United Kingdom shows a sizeable drop in September. Over two months only France shows an improvement and over three months Italy is unchanged as France continues to show a gain and the U.K. shows a worsening. It would be hard to look at these data and find anything better than a possible spark of good news. In terms of the standing of confidence, Italy shows strong results apart from its recent trend changes with September marking an 80.5 percentile standing in its confidence measure. France has only a 43-percentile standing despite its recent gains. The U.K. is still nearly at its median level with a standing at its 49.2 percentile despite its recent sharp erosion.
by:Robert Brusca
|in:Economy in Brief
France| Sep 25 2024
In France Household Confidence Is on the Upswing
With so much weak data being reported, the INSEE household survey out of France is a breath of fresh air. Household confidence is sharply higher, rising to 95.1 in September from 92.5 in August, a jump that has been exceeded on a month-to-month basis only 12% of the time over the past 18 years. It was last stronger in February 2022, over two years ago. Yes, the September gain is sizeable.

The gain brings the level of confidence to a standing at its 49.6 percentile, near to its historic median on data back to 2001 (the median for ranked data occurs at a ranking of 50).

Granted, this only puts household confidence back at its median, but it is slightly above its mean. This qualifies as being called ‘normal.’ France has normalized its household sector despite all the Covid and post-Covid chaos that for France includes now the installation of a new government. France is also in the aftermath of having hosted the Olympics and having dealt with a nationwide transportation sabotage associated with forces trying to disrupt that event.

The headline index is below the 50% mark by small amount and among the 10-components five are also below their respective 50-percentiel standings – but not all those sub-50 readings are bad. Living standards for the past 12 months as well as the future 12 months are below, but close to their 50-percentiel ranking; the assessment for the next 12 months is one point below its mean. Next, unemployment assessment is below its median value at a percentile standing of 39.4. That is good news that expected unemployment is well-below its median.

While prices over the past 12 months register a median assessment at the 50-percentiel mark, the look-ahead for the next 12 months gets a very low 3.6 percentile standing. Inflation in France is widely, strongly, expected to be lower. That is more good news. And the favorability to save metrics are high.

One fly in the ointment is that it is not considered a favorable time to make a major purchase, as the rank standing for that assessment is a lower 18-percentile reading. Still, households rate their past financial situation as strong with a 64.2 percentile standing; the next 12 months ahead are even better with a 70.4 percentile standing.

The INSEE survey of France households in September is a refreshingly optimistic take on conditions in Europe’s second largest economy. This is particularly good news since conditions in Germany, Europe’s largest economy, still show that it is under pressure.
by:Robert Brusca
|in:Economy in Brief
Belgium| Sep 24 2024
Belgian National Bank Index Continues to Weaken
The Belgian National Bank index has weakened in each of the last four months. Manufacturing also has weakened for four months running. The production index has suddenly, in September, declined sharply, falling from a small negative reading over the previous four months to a suddenly much weaker reading of -23 in September. A case of SOW: Sudden onset weakness. And central banks remain concerned. They already are cutting inflation ‘slack’ to hover at above target levels as they find reasons to cut rates and try to preserve growth while exuding optimism on inflation coming to heel…some day.

Meanwhile, trends have broadly shifted in Belgium. The domestic order trend is weaker in September, falling to -15 from -6 in August. But that is no example of sudden onset weakness. The domestic orders index has been even weaker in recent months and has been fluctuating. However, foreign orders have turned sharply weaker in September, falling to -26 from -3 in August after four months of logging small negative numbers. Foreign orders are back to the sort of weak reading they had logged in February of this year except they are even a bit weaker now, in September. Prices also have turned weaker; they were last weaker back in March of this year. The coincident weakness in activity orders and prices makes it look as though encroaching economic weakness is for real.

Current assessments show persistently larger negative readings and readings with a slightly weaker tone when assessed over equal time periods on a ranking basis. Both total and foreign orders are quite weak in September and are weakening further. On a ranking basis, they have a standing in their 6th to 9th percentiles- exceptionally weak- when ranked on data back to 1997.

However, the other metrics, such as for the BNB headline, for production and trend analysis can be even weaker on ranking basis than these deep negative survey readings assessing orders. For example, the headline for the Belgian Bank index has an 11.9 percentile standing. Manufacturing has a 10.6 percentile standing. The production trend has a 1.5 percentile standing - an exceptionally weak trend assessment. The domestic order trend has a 17.9 percentile standing, but the foreign order trend has an extremely low, 2.4 percentile standing. The price trend lags behind these weak readings with a still very weak 16.1 percentile standing of its own. There is nothing here that is reassuring, and Belgium is a European country at the crossroads of a lot of trade.

The assessments for other sectors such as wholesaling & retailing, construction, and business services show rankings that range from a low at an 11.9 percentile ranking for construction to a 37.1 percentile ranking for wholesaling & retailing. Services are generally more resilient.
by:Robert Brusca
|in:Economy in Brief
Global| Sep 23 2024
Flash Global PMIs Fade Broadly in September
September PMI readings faded across the board. Composite PMI readings fell in each of the seven early reporting entities. In fact, PMIs fell for all composites and services readings generating showed only a single increase for manufacturing in September - that was in France. Among the 21 composite and sector readings in August, 12 had improved, the same as in July. The September result is a watershed change compared to the last two months, where although data still were mixed, they favored improvement.

With the turnabout in September not even included, the sequential readings are souring (the sequential averages are presented only on finalized data). The three-month averages (through August) still only show improvement in six of twenty-one composite and sector readings. That is a sharp shift from the six-month change where the averages improved broadly compared to the 12-month averages, declining in only five composite and headline readings. Over 12 months conditions broadly improved compared to a year ago, with only eight composites and sectors showing a worsening.

The queue percentile rankings are mostly below the 50% mark that reflects the median for the period of ranking back to January 2020. The ranking exceptions are India where the composite and both sectors rank above their respective medians, the United Kingdom, where the composite is above a 50% ranking, and the United States, where the composite and the service sectors have above-median rankings. Still, for the U.S., the U.K. and India, all readings weakened this month. For the U.S., the manufacturing reading is exceptionally weak at an 8.8 percentile standing, tied with Germany for the second lowest standing in the group.

As an indicator of how troubled the global economy has been in this group of advanced countries plus India, of the 21 composite and sector rankings for the group, 12 of them show weaker readings in September than in January 2020. As we noted above, few are above their period median values based on ranking statistics.

For this group of respondents, the average composite ranking is 42.9, the average manufacturing reading is 23.6 and the average service sector reading is 50.6. It is the service sector that has been providing the backbone for sustaining growth while manufacturing has been severely impaired.
by:Robert Brusca
|in:Economy in Brief
France| Sep 20 2024
France INSEE Survey Shows Slightly Weaker Manufacturing While the Service Sector Improves
The industry climate gauge from the INSEE survey reports a standing in its 27th percentile with manufacturing production expectations at the 29th percentile; both are relatively weak readings. The services sector has a weak reading, too, that stands in its 36th percentile. The standing for services is slightly stronger than for manufacturing and production expectations, but both are basically in the lower one-third of the queue of readings for each sector. In September, industry climate has weakened although manufacturing production expectations improved slightly. The service sector index is slightly improved. In recent times, globally manufacturing has been weak, while the services sector has provided the bulk of the growth. According to the INSEE surveys, there was not much strength in either sector as of September.

Manufacturing The production recent trend observation for September did improve compared to August when it moved up to a -6.2 reading from -13 previously. However, orders and demand weakened to -19.5 in September from -15.9 in August; there was a similar deterioration for foreign orders and demand.

Prices show less pressure with the own-sector likely price trend moving lower to +1.2 in September from +2.3 in August. While the manufacturing price level overall trend just slips to 2.0 in September from 5.6 in August. The percentile standings for all of these readings are in or near in the lower third of their respective historic queue of data across the board. The only exception is foreign orders and demand that has a 56.3 percentile standing. That's the only standing above the 50th percentile, which puts the reading above its historic median on data back to 2001.
by:Robert Brusca
|in:Economy in Brief
Europe| Sep 19 2024
European Car Registrations Plummet; Registrations Were Last Lower 25 Months Ago
Car registrations in Europe are plunging and they're plunging pretty much everywhere where the data are being reported. One of the reasons for this is the sudden lack of popularity in electric vehicles, whose purchase demand has declined precipitously.

Country level data show that declines in registrations in August range from a month-to-month decline of 11.8% in Germany, to declines of 2.6% each in France and the United Kingdom. Germany, France, Italy, and Spain show substantial month-to-month declines in August and in July. Only the U.K. is an exception to this two-month losing streak; the U.K. 2.6% decline in registrations in August comes after a 3.9% increase in registrations in July.

Year-over-year total European registrations are down by 20.6%; smoothing this to look at declines over a three-month average reduces the drop to 6.6%; however, whether we look at raw declines or smoothed declines, the declines are generally getting bigger over shorter periods. The smooth declines, for example, moved from a 6.6% decline over 12 months to a 9.9% annualized decline over six months to a 10.9% annual rate of decline over three months. The annualized rate of decline is growing. The raw number for the year-over-year decline is a drop of 20.6% over 12 months, over six months that decline pace accelerates to 28.1% annualized, although there is a slight pullback showing a decline of 24.4% over three months; it's still a greater pace of decline than over 12 months.

The country level data show us that year-over-year declines range from exceptionally weak numbers like -27.6% in Germany and -21.1% in France, to more modest declines like -2.1% in the U.K. and -5.9% in Spain. However, all five reporting countries show year-over-year declines and of course the aggregate numbers presented are dismal.

If we compare what's going on with registrations now to the level of registrations before COVID struck, we're looking at double-digit declines. Raw net decline calculations round to double-digit declines for all five countries. The biggest shortfall from January 2020 levels is the U.K. that is 25.5% lower; however, Germany is also 23% lower, Italian registrations are about 21% lower, registration in France are 14% lower, while in Spain registrations are 9.5% lower.
by:Robert Brusca
|in:Economy in Brief
United Kingdom| Sep 18 2024
U.K. Inflation Flares: Accelerates- Headline, Core; Stick a Fork in the BOE the Rate Cuts Are Done
Inflation in the United Kingdom, as measured by the CPIH, rose by 0.4% in August as well as for the measure excluding energy, food, alcohol, and tobacco that rose by 0.5%. The recent sequence of monthly inflation rates is not hospitable or kind to the notion of the Bank of England doing any further rate cuts anytime soon.

Sequential inflation readings show the headline CPI measure up 3.1% over 12 months and at a 2.9% annual rate over six months. It further accelerates to a 4% pace over three months. The expanded core excluding energy, food, alcohol, and tobacco is up by 4.4% over 12 months, up at a 5.1% annual rate over six months and continues to rise at a 5% annual rate over three months. Both series are at some point about a tick or so short of being persistently accelerating measures. However, putting technicalities aside, inflation clearly is accelerating in the U.K. and both measures embrace generally accelerating trends. The year-over-year headline pace of 3.1% is too fast; the core rate of 4.4% is way too fast. The three-month growth rates that have the headline at 4% and the expanded core 5% are far too fast.

Applying the diffusion concept to 12-month inflation compared to a year ago, inflation does decelerate on that time horizon with a diffusion value only at 18%. Diffusion above 50% means inflation is accelerating in more places than it is decelerating. Below 50% diffusion flags inflation that is more broadly decelerating. The 12-month reading flags a sharp broad slowing for inflation. Of course, the 12-month headline inflation rate is 3.1% and a year ago it was running at twice that pace of 6.3% so finding general broad deceleration is not too surprising. The next step is a comparison of six-month inflation to 12-month inflation. Here we see diffusion up to 63.6%. So, inflation is accelerating in more categories than it's decelerating over six months compared to 12 months, not a good development. Over three months, however, headline inflation accelerates to 4% while the core is more or less unchanged at around the 5% mark, but diffusion falls back to 36.4% indicating that inflation is only accelerating at about one-third of the categories over three months. So that's a better development.

On a month-to-month basis, diffusions in August and July are both above 50%; but diffusion in June fell a little short of that with a diffusion gauge at 45.5%. Recent months seem to show some inflation pressures on balance.
by:Robert Brusca
|in:Economy in Brief
Germany| Sep 17 2024
Germany’s ZEW Survey Sours
Germany’s ZEW survey has deteriorated sharply in September. The current index has fallen to -84.5 in September from -77.3 in August. The expectations index fell back to 3.6 from 19.2 in August. It had been as high as 41.8 as recently as July 2024. Conditions and expectations for Germany have taken a sharp turn for the worse over the last few months. The chart shows that expectations are much better than their depths of 2022. Their evolution from there has been erratic, but there has been a clear and strong rebound in expectations from those lows of 2022. However, there's also been significant vacillation and we're currently in a period in which the downdraft in expectations is relatively severe. Current conditions are amid quite different circumstance; they had some rebound from their 2022 lows which were still slightly higher than the 2020 lows that occurred during COVID. However, that rebound was not long lasting; in 2023 the current index had sunk substantially and although there was some minor rebound, we are now seeing current conditions making new lows and some of the lowest readings that we've seen since the brief COVID-caused recession.

The current index has been stronger than its current value 94% of the time, underscoring how extremely weak the current observation is. Expectations have been stronger about two-thirds of the time, a significant metric, but not as draconian as the reading for current conditions. However, in July expectations were strong enough that they had been weaker only about one quarter of the time. Both expectations and current conditions have taken a severe turn for the worse.
by:Robert Brusca
|in:Economy in Brief