3/2/21: EconUpdate by P. Duffy

EconUpdate by P. Duffy

January construction spending rises another 1.7 percent to record high

Construction spending during January 2021 was estimated at a seasonally adjusted annual rate of $1,521.5 billion, a record high for this series dating back to 1993, and up 1.7 percent from December and 5.8 percent above January 2020.


February manufacturing index rebounds 2.1 points to 60.8, for ninth straight month of expansion

The February Manufacturing PMI® registered 60.8 percent, an increase of 2.1 percentage points from the January reading of 58.7 percent. This figure indicates expansion in the overall economy for the ninth month in a row after contraction in March, April, and May. Issues with absenteeism, short-term shutdowns to sanitize facilities, and difficulties in hiring workers remain challenges and continue to cause strains that limit manufacturing-growth potential.


Both January personal income and savings surge due to stimulus payments

Personal income surged 10.0 percent in January (largely due to stimulus payments), while personal consumption expenditures (PCE) increased just 2.4 percent, leading to a sharp rise in the personal savings rate to 20.5 percent.


Inflation tracker PCE price index up 0.3 percent in January and 1.5 percent year-on-year

The PCE price index increased 0.3 percent in January and was up 1.5 percent year-on-year . Excluding food and energy, the PCE price index was up the same amount in both January and year-on-year.  Although Real PCE increased 2.0 percent during the month, the price of goods increased 5.1 percent while services rose 0.5 percent.