The US Dollar closed Friday with marginal gains following a week of poor data releases.
Consumer Spending Cools in August
Significantly, for an economy that is made up of two-thirds consumer spending, data from Commerce Department data showed on Friday that consumer spending on goods and services, rose by 0.1% from July, the smallest gain in half a year.
Separately, the US Commerce Department report showed bookings for non-military capital goods excluding aircraft — a proxy for business investment — declined 0.2% in August, the poorest performance in four months.
The larger than expected decline in non-military capital goods orders highlights how the ongoing U.S.-China trade war and slowing global growth are affecting US businesses.
U.S. Apartment Vacancy Rates Flat
Real estate research firm Reis Inc reported this week that the U.S. apartment vacancy rate was flat in Q3, with vacancy increasing in 23 of 79 metros. The vacancy rate stayed at 4.7% from the same time last year.
U.S. Business Investment Contracts
U.S. business investment contracted more than had previously been forecast in Q2 whilst corporate profit growth remained tepid. Business investment fell at a 1.0% on an annual basis last quarter, the steepest decline since the final quarter of 2015.
The near 15-month trade war with China is being blamed for the disappointing figures. The soft investment and sluggish profit gains are raising fears regarding the consumers’ ability to continue fueling the world’s largest economy.
U.S. Weekly Jobless Claims Inch Higher
The US Labor Department reported on Thursday that initial claims for state unemployment benefits rose 3,000 to a seasonally adjusted 213,000 for the week ended 21st September. Data released for the week prior was revised to show 2,000 more applications were received than previously reported.
The four-week moving average of initial claims which is regarded as a more accurate measure of labor market trends posted a decline of 750 to 212,000 last week. Job growth in 2019 has slowed to an average of 158,000 per from the 223,000 per month average recorded in 2018, The figure although disappointing remains higher than the estimated 100,000 per month needed to sustain growth within the working-age population.
US Dollar Mixed
Despite the weak US data, the US Dollar closed the week with marginal gains. The USD/JPY closed up 0.13%, the GBP/USD ended the week down 0.26%. However, the EUR/USD closed up 1.17% and the USD/CAD closed down 0.20%.
