The American economy is on track to grow at a 5.4 percent annualized rate in the first quarter of this year, the Atlanta Federal Reserve’s GDPNow forecast model showed on Monday.
The regional Fed’s forecast rose from last week’s 4.2 percent growth following a report on manufacturing that showed more expansion than expected. The forecast of real consumer spending growth rose from 3.1 percent to 4.0 percent, while the forecast of investment growth soared from 5.2 percent to 9.2 percent.
This is an early reading, based on just one-months data. Even the most optimistic economists do not expect the economy to expand at that rate in the first quarter.
Both the Atlanta Fed’s GDPNow and the New York Fed’s Nowcast had readings for the fourth quarter of 2017 that were substantially higher than the official initial estimate, which came in at a 2.6 percent annual growth rate.
Union Pacific (UNP) CEO Lance Fritz on Thursday told FOX Business that President Trump’s infrastructure and tax reform plans will boost the economy, which in turn will help his business prosper.
“Let’s start at the highest level. We love infrastructure investment because it helps the U.S. economy be more robust. A good highway system, a safe airway system, robust electricity grid, all of that ultimately would benefit the Union Pacific,” he told FOX Business’ Liz Claman on “Countdown to the Closing Bell.”
President Trump said Wednesday he would add an additional $700 million to his originally proposed $1 trillion infrastructure plan. The president plans to discuss the $1.7 trillion infrastructure package next week, during the annual State of the Union address
Manufacturing, which makes up more than 75 percent of total industrial production, accounts for about 12 percent of the U.S. economy. It increased 2.4 percent in December from the same month a year earlier.
Factory output climbed 1.3 percent in 2017, the strongest annual reading in five years
Expect lowest business inventory-to-sales ratio in three years could translate into increased production in coming months.
( Bloomberg by Katia Dmitrieva) U.S. factory production rose for a fourth straight month in December, capping the strongest quarter since 2010 and underscoring a resurgence in manufacturing that’s primed for further advances, Federal Reserve data showed Wednesday.
Factory output increased at a 7 percent annualized rate in the fourth quarter, the strongest since the second quarter of 2010. Combined with national and regional surveys of purchasing managers, the figures indicate manufacturing was robust at the end of the year.
Stronger consumer spending, increased business investment and more shipments of merchandise to overseas customers are providing plenty of fuel for the nation’s producers. What’s more, the lowest business inventory-to-sales ratio in three years could translate into increased production in coming months.
Factory output climbed 1.3 percent in 2017, the strongest annual reading in five years.
The Fed’s monthly data are volatile and often get revised. Manufacturing, which makes up more than 75 percent of total industrial production, accounts for about 12 percent of the U.S. economy. It increased 2.4 percent in December from the same month a year earlier.
Utility output jumped 5.6 percent, boosted by colder weather, after falling 3.1 percent the prior month
Mining production rose 1.6 percent; with oil and gas well drilling rising 0.9 percent
Production of motor vehicles increased 2 percent, the most in four months; excluding autos and parts, manufacturing output fell 0.1 percent
Production of consumer goods rose 1 percent, and output of business equipment increased 0.2 percent
Output of machinery and wood products increased in December
( CNBC ) Homeowners are racking up record amounts of home equity, thanks to fast-rising values in today’s competitive housing market. No surprise, more people are now starting to tap that cash. What are they spending it on? Mostly making their homes even more valuable.
Renovation spending is soaring, and 80 percent of borrowers taking out home equity lines of credit say they would consider using that money to renovate, according to a survey released in December by TD Bank.
“We’re not only seeing more requests for proposals, but more committed projects from home owners,” said Steve Cunningham, a remodeler from Williamsburg, Virginia, in a report from the National Association of Home Builders. “In addition to regular updates and repairs, there’s been an uptick in more ambitious large remodel requests.”
Remodeling spending topped $152 billion in 2017, and renovations for owner-occupied single-family homes will increase 4.9 percent in 2018 over 2017, according to the NAHB. That does not include remodeling done by investors looking to flip or rent properties, both of which are increasing as well.
Gary Cohn: ‘Since we announced tax reform, in just two weeks we’ve had well over 100 companies announce year-end bonuses, 401(K) contributions or increased minimum wages for about a million workers in the United States.”
Companies have already responded to the tax reform Opens a New Window. package, announcing plans to pass along some of the savings to their employees. AT&T (T) said it would give $1,000 bonuses even before the tax plan was signed into law and other companies such as Comcast (CMCSA), U.S. Bank and Fifth Third Bancorp (FITB) have followed suit. Wells Fargo (WFC) said it will raise the minimum wage at the company to $15 an hour.
White House National Economic Council Director Gary Cohn weighed in on corporate America’s response to the tax package telling FOX Business’ Stuart Varney on “Varney & Co.,” “Look at what’s happened since we announced tax reform. In just two weeks we’ve had well over 100 companies announce year-end bonuses, 401(K) contributions or increased minimum wages for about a million workers in the United States.”
According to Cohn, even those at the White House were surprised by the response.
“So, a million workers in the last week of 2017 got a surprise just because of the tax reform package and that is something that we didn’t even expect to see.”
The construction sector is ready to boom in 2018, but there’s just one problem: There aren’t enough qualified workers.
A new report released by the Associated General Contractors of America (AGC), found that 75% of contractors want to increase their headcount in 2018, thanks to the newly-approved tax reform bill, the government’s push to rollback red tape, strong economic growth and a continuation of favorable sector trends.
However, 50% of companies reported having a difficult time filling both craft and salaried worker positions. Over the coming year, 53% of companies told the AGC that they expect to continue struggling to find qualified applicants. These challenges come despite the fact that 60% of firms reported increasing base pay to retain or recruit professionals and 36% provided incentives and bonuses toward the same end.
“The general population doesn’t know how rewarding and profitable [construction jobs can be],” Stephen Mulva, director of the Construction Industry Institute (CII), told FOX Business. “Six-figure salaries are not uncommon.”
“Goods-producing jobs up 600% last year, that is absolutely remarkable.”
Charles Payne: It’s not about the service side, manufacturing, even this morning in this morning’s jobs report you have 30,000 construction jobs, 25,000 manufacturing jobs. ADP’s number for the full year – goods producing jobs, these are people who work with their hands. This is the heartland. This is what gave Trump Ohio and Pennsylvania. Those jobs up 600% year over year. Over 500,000 versus eighty something thousand.