Nowcast: US industrial production stagnates while retail sales stay robust

Following its June 11-12 meeting, the Federal Reserve offered few hints that it was prepared to start lowering interest rates soon. As our nowcasts suggest, the mixed picture in the economy has probably not been pessimistic enough for Chairman Powell to ease off in the battle against inflation.

Industrial production is likely to show stagnation (but not a decline) for May; meanwhile, the US consumer remains robust.

According to CEIC’s proprietary weekly nowcast, the industrial production index (IPI) for May will be little changed after contracting in April. Our machine-learning model projected that the May IPI growth rate was in slightly negative territory in its weekly readings last month; the second week of June saw a move to relative optimism, with the weekly nowcast showing a growth rate just above zero.

Consumption, on the other hand, was repeatedly projected to have maintained its growth pace throughout May. The CEIC nowcast estimates that retail sales growth will accelerate to a 3.5% year-on-year pace from 2.7% in April.

CEIC’s nowcasts rely on high-frequency and alternative data within a machine-learning model to deliver weekly and monthly estimates, offering insights into the underlying factors and high-frequency indicators shaping economic dynamics.

The US economy's resilience after a year of borrowing costs at a 23-year high contrasts with the eurozone and Canada -- which have seen fit to cut rates even as inflation persists.

Explore more of CEIC's proprietary nowcasts:

United States Inflation Nowcast

Japan Inflation Nowcast

Euro Area Inflation Nowcast

United Kingdom Inflation Nowcast

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