A roundup of June's indicators shows that the U.S. economy is in trouble
June was an ugly month for the U.S. economy. After seeing the recovery slow in April and May, the backwards trend continued through the end of the second quarter. Taking stock of the major economic indicators, you really have to squint to see anything good. One thing is clear: the U.S. economy had better break out of its funk if it wants to avoid a double dip.
Here's our usual roundup of 15 major economic indicators (click to enlarge):
That's a lot of red. In fact, if you compare the chart to those from April and May, you can see a steady decline as more indicators are turning red. In June, 10 were worsening, compared to eight in May and seven in April. The direction of change doesn't provide any reason for optimism either. A majority of June's worsening indicators are either newly negative or getting worse faster than they were in May. Let's look a little deeper.
The U.S. Consumer
If there's any way to squeeze some hope out of the grim June statistics, it would be by hoping that consumers are responding positively to declining energy prices. Although real consumer spending technically worsened during the month, it was really virtually flat. That's by no means wonderful, but it's certainly better than the declines we saw in the prior two months. Retail sales, however, increased and hit another new high. This stronger spending came despite worsening consumer confidence; however, we know that in July confidence actually rose a bit.