Insights & Markets
Monthly Economic Outlook
The third quarter witnessed the highest level of quarter-over-quarter growth in the economy since late 2021, with a remarkable increase of 1.2%. This growth can be primarily attributed to robust consumer spending. Survey data, however, was still shaky: in October, the ISM Manufacturing PMI (46.7) and new orders (45.5) both declined further into contraction zone.
Over the last month, the US economy has continued to dominate the world; 3Q GDP estimates tracked at a robust 1.2% QoQ, and August saw increases in core durable goods orders, industrial output, and retail sales. The ISM Manufacturing PMI increased to 49, and the new orders subindex also increased to 49.2.
Core retail sales and industrial production both increased by 1% MoM in July, and 3Q GDP estimates are now tracking at an impressive 1.4% QoQ. The economy continued to be resilient last month. The ISM Manufacturing PMI barely grew to 47.6 in August, while the unemployment rate unexpectedly jumped to 3.8% in August.
In 2Q, the U.S. GDP increased by 0.6%, exceeding estimates. The sub-index for new orders increased to 47.3 while the ISM Manufacturing PMI increased to 46.4 in July, both remained in “contraction”. The labour market remained robust, as seen by the 3.6% unemployment rate in June and the decrease in weekly new claims for unemployment in July.
Core retail sales and core durable goods orders both outperformed forecasts in May, while real estate activity recovered as well. Although the carefully regarded new orders sub-index rose to 45.6, still suggesting contraction, the ISM Manufacturing PMI fell to 46 in June.
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