EMPLOYMENT

There was a decrease in the annual percentage of the initial jobless claims, but the numbers are still extremely high, especially when compared to the American historical record data. This has a negative effect on the demand for consumption and price levels.

INFLATION

There is low inflation at around 0.2% year over year on the CPI and 1.2% in the Core CPI. Yet, the decrease in inflation is at a lower rate, signaling that the pace of momentum to the downward slope is slowing down.

The Producer Price Index came negative for the second consecutive time, but May data came a little less negative at -0.8% from -1% in April on a year over year basis.

GROWTH

The actual situation of the American economy is deflationary, as most of coincident indicators that tracks the country’s global output and performance (industrial production, retail sales, GDP, housing starts, etc.) are divided between deflationary and extreme deflation.

Major leading indicators are signaling an April bottoming, followed by a little upward retracement in May and June. The recovery in major soft data indicates a transition from the extreme deflation, which needs a dovish Central bank to become less deflationary.

The recovery phase in the U.S economy is expected to last for a bit longer before returning to normal levels of growth.