MetroIntelligence Economic Update by P. DUFFY
Producer Price Index rises 1.1 percent in June and 11.3 percent year-on-year
The Producer Price Index for final demand increased 1.1 percent in June, following advances of 0.9 percent in May and 0.4 percent in April. Final demand prices moved up 11.3 percent for the 12 months ended in June, the largest increase since a record 11.6-percent jump in March 2022. Prices for final demand less foods, energy, and trade services moved up 0.3 percent in June after advancing 0.4 percent in both May and April. For the 12 months ended in June, the index for final demand less foods, energy, and trade services rose 6.4 percent.
Federal Reserve Beige Book shows mixed signs of economic activity
Economic activity expanded at a modest pace, on balance, since mid-May; however, several Districts reported growing signs of a slowdown in demand, and contacts in five Districts noted concerns over an increased risk of a recession. Most Districts reported that consumer spending moderated as higher food and gas prices diminished households’ discretionary income. Housing demand weakened noticeably as growing concerns about affordability contributed to non-seasonal declines in sales, resulting in a slight increase in inventory and more moderate price appreciation. Commercial real estate conditions slowed.
2Q2022 Remodeling Market Index falls 10 points year-on-year to 77
The NAHB/Westlake Royal Remodeling Market Index (RMI) for the second quarter of 2022 posted a reading of 77, declining 10 points from the second quarter of 2021. This is the largest year-over-year decrease since the survey was redesigned in Q1 2020. Year-over-year, the subcomponent measuring large remodeling projects experienced the largest decline (-11 points) to 79, compared to the subcomponent measuring moderately-sized remodeling projects falling 7 points to 84 and the subcomponent measuring small remodeling projects slipping by 6 points to 86.