Weekly Economic Activity through September 17th

Year-on-year, exercise development remains to be rising. Shown under are the Lewis-Mertens-Stock (NY Fed) WEI, and the Woloszko (OECD) Weekly Tracker, and the Baumeister-Leiva-Leon-Sims Weekly Economic Conditions Index for the US, for knowledge up to a couple days in the past (September 17th):

Figure 1: Lewis-Mertens-Stock (NY Fed) Weekly Economic Index (blue), Woloszko (OECD) Weekly Tracker (tan), Baumeister-Leiva-Leon-Sims Weekly Economic Conditions Index for US plus 2% pattern (inexperienced) Source: NY Fed by way of FRED, OECD, WECI, and writer’s calculations.

The WEI took a dive from the earlier week, all the way down to 1.8% from 2.8%, whereas the Weekly Tracker continued to rise. It’s truthful to say there some divergence, which isn’t stunning, given the big variations in methodologies. The WEI depends on correlations in ten sequence out there on the weekly frequency (e.g., unemployment claims, gasoline gross sales, retail gross sales). The Weekly Tracker is “big data” strategy that makes use of Google Trends and machine studying to trace GDP.

The WEI studying for the week ending 9/17 of 1.8 is interpretable as a y/y quarter development of 1.8% if the 1.8% studying have been to persist for a whole quarter. The OECD Weekly Tracker studying of three.8 is interpretable as a y/y development fee of three.8% for yr ending 9/17. The Baumeister et al. studying of 1.1% is interpreted as a 1.1% development fee in extra of long run pattern development fee. Average development of US GDP over the 2000-19 interval is about 2%, so this means a 3.1% development fee for the yr ending 9/17.

Since these are year-on-year development charges, it’s attainable we have been in a recession in H1 as one observer instructed a month in the past, however it (nonetheless) appears unlikely.