- Real GDP decreased at an annual rate of 32.9% in the second quarter of 2020, according to the “advance” estimate by the Bureau of Economic Analysis. In the first quarter, real GDP decreased 5.0%. The decrease in real GDP reflected decreases in personal consumption expenditures, exports, private inventory investment, nonresidential fixed investment, residential fixed investment, and state and local government spending that were partly offset by an increase in federal government spending.
- Real final sales of domestic product (GDP less change in private inventories) decreased 29.3% in the second quarter, in contrast to a decrease of 3.6% in the first quarter.
- The price index for gross domestic purchases decreased 1.5% in the second quarter, compared with an increase of 1.4% in the previous quarter.
- The personal consumption expenditures (PCE) price index decreased 1.9%, compared with an increase of 1.3% in the previous quarter. Excluding food and energy prices, the PCE price index decreased 1.1%, compared with an increase of 1.6%.
- Current-dollar GDP decreased 34.3%, or $2.15 trillion, in the second quarter to a level of $19.41 trillion. In the first quarter, GDP decreased 3.4%, or $186.3 billion.
- It was noted by the Bureau of Economic Analysis: “The decline in second quarter GDP reflected the response to COVID-19, as “stay-at-home” orders issued in March and April were partially lifted in some areas of the country in May and June, and government pandemic assistance payments were distributed to households and businesses. This led to rapid shifts in activity, as businesses and schools continued remote work and consumers and businesses canceled, restricted, or redirected their spending. The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the second quarter of 2020 because the impacts are generally embedded in source data and cannot be separately identified.
- Personal income decreased $222.8 billion (1.1%) in June according to the Bureau of Economic Analysis. Disposable personal income (DPI) decreased $255.3 billion (1.4%) and personal consumption expenditures (PCE) increased $737.7 billion (5.6%). Real DPI decreased 1.8% in June and real PCE increased 5.2%.
- The PCE price index for June increased 0.4% from the previous month and increased 0.8% from a year ago. Excluding food and energy, the PCE price index increased 0.2% from the previous month and increased 0.9% from June of 2019.
- The advance figure for initial claims for unemployment insurance increased 12 thousand to 1,434 thousand in the week ending July 25. The 4-week moving average was 1,368.5 thousand, an increase of 6.5 thousand from the previous week’s revised average. The advance number for seasonally adjusted insured unemployment (ongoing) during the week ending July 18 was 17,018 thousand, an increase of 867 thousand from the previous week’s revised level. The 4-week moving average was 17,058.25 thousand, a decrease of 435.5 thousand from the previous week’s revised average. The advance seasonally adjusted insured unemployment rate was 11.6% for the week ending July 18, an increase of 0.5 percentage point from the previous week’s unrevised rate. It was stated that: “The COVID-19 virus continues to impact the number of initial claims and insured unemployment. This report now includes information on claimants filing Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation claims.”
- Unemployment rates were higher in June than a year earlier in 388 of the 389 metropolitan areas and lower in 1 area, according to the U.S. Bureau of Labor Statistics. A total of 218 areas had jobless rates of less than 10.0% and 6 areas had rates of at least 20.0%. Nonfarm payroll employment decreased over the year in 307 metropolitan areas and was essentially unchanged in 82 areas. The national unemployment rate in June was 11.2%, not seasonally adjusted, up from 3.8% a year earlier.
- Compensation costs for civilian workers increased 0.5%, seasonally adjusted, for the 3-month period ending in June 2020, according to the U.S. Bureau of Labor Statistics. Wages and salaries increased 0.4% and benefit costs increased 0.8% from March 2020. Compensation costs for civilian workers increased 2.7% for the 12-month period ending in June 2020, the same increase a year ago.
- From September 2019 to December 2019, gross job gains from opening and expanding private-sector establishments were 7.8 million, an increase of 490 thousand jobs from the previous quarter, according to the U.S. Bureau of Labor Statistics. Over this period, gross job losses from closing and contracting private-sector establishments were 7.0 million, a decrease of 291 thousand jobs from the previous quarter. The difference between the number of gross job gains and the number of gross job losses yielded a net employment gain of 792 thousand jobs in the private sector during the fourth quarter of 2019.
- Labor productivity rose 0.4% in wholesale trade, 5.3% in retail trade in 2019, according to the U.S. Bureau of Labor Statistics. Unit labor costs, which reflect the total labor costs required to produce a unit of output, rose in wholesale trade and decreased in retail trade.
- The results of Freddie Mac’s Primary Mortgage Market Survey showed that mortgage rates decreasing slightly. The 30-year fixed mortgage rate averaged 2.99% for the week ending July 30, down slightly from last week when it averaged 3.01%. A year-ago at this time, the 30-year fixed-rate averaged 3.75%. The 15-year fixed mortgage rate averaged 2.51%, down from last week when it averaged 2.54%. A year-ago at this time, the 15-year fixed-rate averaged 3.20%.
- Mortgage applications decreased 0.8% from a week earlier, according to data from Mortgage Bankers Association’s (MBA) Weekly Applications Survey for the week ending July 24, 2020.
- There were 17,859,763 COVID-19 confirmed cases in the world, 685,179 deaths, and 10,564,263 recovered, according to Johns Hopkins University, Coronavirus Resource Center (access date and time: 8/2/2020, 10:00 EST). In the United States, there are 4,620,502 confirmed cases, 154,449 deaths, and 1,461,885 recovered cases. The world is struggling to control the spread of the virus.
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