{"id":1733,"date":"2020-05-13T14:07:27","date_gmt":"2020-05-13T18:07:27","guid":{"rendered":"https:\/\/naroffeconomics.com\/?p=1733"},"modified":"2020-05-13T14:07:27","modified_gmt":"2020-05-13T18:07:27","slug":"april-producer-prices-help-wanted-online-index-and-fed-chair-powell-speech","status":"publish","type":"post","link":"https:\/\/naroffeconomics.com\/?p=1733","title":{"rendered":"April Producer Prices, Help Wanted OnLine Index and Fed Chair Powell Speech"},"content":{"rendered":"\n

KEY DATA:<\/strong>  PPI: -1.3%; Ex-Energy: -0.3%; Energy: -19%\/\nHWOL: -40.8 points<\/p>\n\n\n\n

IN A\nNUTSHELL:<\/strong>  \u201cDecelerating inflation and limited job\nopenings are likely to be with us for a while. \n\u201d<\/em><\/strong><\/p>\n\n\n\n

WHAT IT\nMEANS:<\/strong>  With the biggies, the employment and GDP\nreports, behind us, there are still some important numbers to watch as we go\nthrough the month.  Yesterday we saw that\nwhile headline consumer inflation decelerated sharply in April, it was largely due to\nenergy prices.  Similarly, the April\nProducer Price Index cratered, also driven by energy.<\/em><\/strong>  Excluding energy, wholesale costs declined\nsomewhat only moderately.  <\/em><\/strong>About\nthe only thing that posted major gains were the margins of wholesalers and\nretailers.  Otherwise, prices\nwere down just about everywhere else, including food.<\/em><\/strong>  Goods (excluding energy) prices fell a little\nmore services costs, but the declines were not that great. Looking into the future,\nintermediate costs, especially for unprocessed goods, were off significantly\nand that points to continued downward pressure on producer and possibly\nconsumer prices.<\/em><\/strong><\/p>\n\n\n\n

The Conference Board reported that online want ads\ncollapsed in April.<\/em><\/strong>  With firms closed, that was\ninevitable.  The index level was the lowest\nsince March 2012, but it is still well above the record low set in July 2009.<\/em><\/strong>  I am not sure we will take that bottom out as\nfirms are starting to reopen.  <\/p>\n\n\n\n

Fed Chair\nPowell Speech:<\/strong> Fed Chair Jerome Powell gave a talk today and he raised some important\nwarnings, especially about the potential need for a lot more policy actions on\nthe part of both the Fed and the government. \n<\/em><\/strong>He is worried about an extended recession that devastates small\nbusinesses and limits the recovery.  He\ndiscussed the need to get people back to work quickly or risk extending the\nperiod of high unemployment.  And he made\nit clear that Congress has to spend the vast amount of money needed to prevent those\nconcerns from happening.  Here are some\nsections from his speech and they need no further commentary:<\/p>\n\n\n\n

While the\neconomic response has been both timely and appropriately large, it may not be\nthe final chapter, given that the path ahead is both highly uncertain and\nsubject to significant downside risks. Economic forecasts are uncertain in the\nbest of times, and today the virus raises a new set of questions: How quickly\nand sustainably will it be brought under control? Can new outbreaks be avoided\nas social-distancing measures lapse? How long will it take for confidence to\nreturn and normal spending to resume? And what will be the scope and timing of\nnew therapies, testing, or a vaccine? The answers to these questions will go a\nlong way toward setting the timing and pace of the economic recovery. Since the\nanswers are currently unknowable, policies will need to be ready to address a\nrange of possible outcomes.<\/em><\/p>\n\n\n\n

The overall\npolicy response to date has provided a measure of relief and stability, and\nwill provide some support to the recovery when it comes. But the coronavirus\ncrisis raises longer-term concerns as well. The record shows that deeper and\nlonger recessions can leave behind lasting damage to the productive capacity of\nthe economy. \u2026 The result could be an extended period of low\nproductivity growth and stagnant incomes.<\/em><\/p>\n\n\n\n

We ought to do\nwhat we can to avoid these outcomes, and that may require additional policy\nmeasures. At the Fed, we will continue to use our tools to their fullest until\nthe crisis has passed and the economic recovery is well under way\u2026 Additional\nfiscal support could be costly, but worth it if it helps avoid long-term\neconomic damage and leaves us with a stronger recovery. This tradeoff is one\nfor our elected representatives, who wield powers of taxation and spending.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

KEY DATA:  PPI: -1.3%; Ex-Energy: -0.3%; Energy: -19%\/ HWOL: -40.8 points IN A NUTSHELL:  \u201cDecelerating inflation and limited job openings are likely to be with us for a while.  \u201d WHAT IT MEANS:  With the biggies, the employment and GDP reports, behind us, there are still some important numbers to watch as we go through … Continue reading April Producer Prices, Help Wanted OnLine Index and Fed Chair Powell Speech<\/span> →<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,1],"tags":[],"class_list":["post-1733","post","type-post","status-publish","format-standard","hentry","category-economic-indicators","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1733","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1733"}],"version-history":[{"count":1,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1733\/revisions"}],"predecessor-version":[{"id":1734,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=\/wp\/v2\/posts\/1733\/revisions\/1734"}],"wp:attachment":[{"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1733"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1733"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naroffeconomics.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1733"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}