I have had a rough time for the last few weeks coming up with commentary that has anything new to say. It seems that we are bombarded day after day with talk of trade wars, tariffs and counter-tariffs.
Just today, April retail and industrial production numbers came out in China and in the USA. To say the least, the numbers were uninspiring at best.
In the USA retail sales for April contracted 0.2%. Much of the weakness was in auto sales because taking the auto numbers out there was a .1% gain in April. Electronics and building materials also fell. US industrial production, which has been stagnant all year, was not expected to grow in April either. It still surprised on the downside contracting 0.5%. That is the largest monthly drop since May of 2018.
Durable consumer goods dropped 0.8%. What caught my eye, however, was production decreased for business equipment, construction supplies and business supplies. This appears to confirm that 500,000 less people are actually working today than were at the beginning of 2019 even though we have “full employment”. What a joke that is! The only reason production wasn’t hurt worse was an increase in defense and space equipment materials.