Consumers Adjust to Inflation

July 11, 2022

As summer rolls on, so do the ups and downs of the economy. Here is a short summary of things drawn from the National Association of Manufacturers' (NAM) Monday Economic Report:

Core PCE (Personal Consumption Expenditures), the Federal Reserve’s preferred measure, eased slightly from 4.9% to 4.7%. However, gas prices and food price inflation, which is driven largely by external factors⁠—such as the continuation of war in Ukraine⁠—continued to accelerate.
Consumer spending has continued to weaken in recent months. Monthly personal consumer expenditure growth slowed to 0.2% in May (from 0.6% in April) as households’ income could not keep pace with inflation, and supply chain disruptions still limited the range of available products.
Despite a decrease in the number of job openings for the second month in a row to 11.3 million in May (11.7 million in April), the job market remains very strong with the number of job openings per unemployed worker still close to historical highs at 1.9. The largest decreases occurred in professional and business services and in manufacturing while openings continued to increase in retail trade, leisure, and hospitality.

While job openings have declined, they haven't declined near enough. Combined with inflation and consumers' response to it, these are some of the headwinds facing businesses in these challenging times. Please note much of this data is from the end of May. I’ll keep you updated when June data becomes available in a few weeks. View full report >

Uniquely Delaware

The BMW Championship is bringing 130,000 to Wilmington, Del. from August 16-21

Fun fact: The 2022 Championships will be played on land that was once home to the duPont family’s sheep farm and its beloved Merino ram, Don Pedro. Wilmington Country Club is paying homage to Don Pedro with this year's logo, which will be featured on apparel sold at the tournament.

News You Can Use

Today we’ll learn about the three-year inflation expectations based upon June data. The NFIB Small Business Index will be out tomorrow with June results. On Wednesday we see inflation data from June, followed by Thursday’s jobless claims data. We wrap up the week on Friday with June retail sales figures, the June import price index, and business inventory figures from May.

Significant corporate earnings calls this week (they are interesting to listen to) includes Delta Air Lines on Wednesday, JPMorgan Chase, Cintas, Conagra Brands, and Morgan Stanley on Thursday. UnitedHealth Group, Black Rock, Citigroup, PNC Financial Services Group, Wells Fargo, and others are on deck for Friday.

Michael J. Quaranta

President

Delaware State Chamber of Commerce

NAI Emory Hill has been providing full-service commercial real estate support for businesses throughout the Mid-Atlantic and developing wealth-building strategies for investors since 1981. Emory Hill is also a 2012 Superstars in Business winner.