Consumer Spending in April Softened After March Rebound
Consumers remained cautious in their spending in April, according to the Census Bureau. Retail sales were unchanged for the month and overall spending has decelerated significantly since the start of the new year, down from a year-over-year rate of 4.7 percent in November to 0.9 percent in April. But the longer-term view may be encouraging, as the number above includes gasoline station sales, which have fallen 22.0 percent since April of last year. Excluding gasoline sales, retail sales grew 3.6 percent year-over-year. To learn more, visit here.
Producer Prices Lower in April Because of Reduced Energy Costs
Producer prices for final demand goods fell 0.4 percent in April, according to the Bureau of Labor Statistics. Final demand goods prices have declined in nine of the past 10 months, largely because of reduced energy costs. In addition to the energy sector, overall food costs are down, thanks to sharply lower egg prices, along with chicken, cooking oils, oilseeds, pork, processed fruits and vegetables and roasted coffee. Over the course of 2015, food costs have declined 4.2 percent. To learn more, visit here.
Weekly Economic Report Shows Continued Dampened Activity
Once again, significant headwinds such as a strong U.S. dollar, slow growth abroad, lower crude oil prices, the West Coast ports slowdown, a cautious consumer and weather have dampened activity in the manufacturing sector. Data points such as the addition of only 1,000 net new workers in April, a fall of labor productivity by 1.1 percent in the first quarter and a substantial widening of the U.S. trade deficit last month all reflect this weaker trend. To learn more, visit here.
R&D Tax Credit Renewal Up For a Vote
The Research and Development (R&D) tax credit helps manufacturers invest in the employees and advanced technology needed to innovate and stay on the cutting edge. Unfortunately, the R&D tax credit expired at the end of 2014. Thankfully, legislation H.R. 880 will soon be up for a vote in the U.S. House of Representatives. If passed, H.R. 880 would reinstate the R&D tax credit, strengthen it and make it permanent. To learn more, visit here.