SEPTEMBER 20, 2021 – THE US ECONOMY IS SHOWING TOUGHNESS
It seems the economy is not ready to cede to the delta variant of the virus that has taken hold. Retail sales were up 0.7 percent in August, recovering from a drop in July. While initial jobless claims, up last week by 20,000, remain close to a pandemic low. Some of the layoffs have been attributed to Hurricane Ida that passed through the south last week.
The delta virus is impacting leisure and travel more than the purchases of hard goods as consumers cut back on trips, concerts and restaurants. The global chip shortage is impacting supply despite the strong demand for certain products such as cars. The full picture on consumer spending will be seen October 1 when the Commerce department will release a report on overall spending.
Economists are guardedly optimistic the economy will regain momentum soon. Cases of the virus seemed to have peaked, supply shortages will abate, and as more Americans get vaccinated, spending habits should return to normal.