Expected data this week should confirm the slowing growth in the economy.

Evidence of a slowing economy due to the surge in the virus is expected to be released this week. Auto sales are expected to remain below 16 million annualized as it was in November. The ISM Index is expected to drop to 56 after reaching a peak of 59.3 in October. This is still above the expansion level of 50 but does indicate the strong manufacturing activity of the past six months is easing. The strength in consumer spending has been in goods and not services in the past two quarters. The service sector of the economy is the most sensitive to closing in an effort to stem the surge in the virus. Consumers have been increasing spending on goods.

 

PROBANK AUSTIN ADVISOR - JANUARY 4, 2021