2021-08-04-牛津经济研究院-US_Recovery_Tracker_shows_signs_of_peak_growth_3页_402kb

US Recovery Tracker Summary

Core Content

The US Recovery Tracker has shown signs of reaching peak growth in July, with the national index plateauing at 97.0 after a five-month upward trend. This stagnation indicates that the pace of recovery has slowed, with no significant gains recorded in the week ended July 23. The recovery is now facing headwinds due to worsening health conditions, slower employment growth, and production constraints, despite continued consumer and business spending.

Main Views

• National Recovery Plateau: The US Recovery Tracker has essentially held steady since early July, with only a 0.1ppt increase. This suggests that the momentum of the recovery is waning, and peak growth is behind us.
• Financial Conditions Improved: Financial conditions eased, rising to 107.9, driven by reduced equity market volatility and low interest rates.
• Consumer Demand Strengthened: Demand increased by 0.7ppt to 105.8, supported by higher spending at grocery stores and on recreational activities, as well as a jump in restaurant bookings.
• Mobility and Activity Improved: Mobility rose to 98.4, fueled by increased air travel, transit ridership, and gasoline demand. Activity also showed modest improvement.
• Employment Growth Slowed: Employment increased slightly to 100.2, with job postings and temporary employment contributing to the modest rise.
• Health Conditions Deteriorated: Health conditions worsened, with the index at 82.1, reflecting a rise in new cases and hospitalizations, though the impact on economic activity is mitigated by high vaccination rates.
• Production Activity Weakened: Production activity fell to 87.5, due to a decline in business applications and lower refinery output, highlighting ongoing supply-side challenges.

Key Information

• Regional Performance:

  • South: The region weakened the most (-2.4ppts to 83.4), with a sharp decline in health conditions, mobility, activity, and employment. Louisiana, Mississippi, and Alabama saw the sharpest drops among all states.
  • Southwest & Mountains: The region gave back some gains (-0.9ppts to 87.0), with weaker health conditions and employment partially offset by modestly stronger mobility and activity.
  • Pacific: The region lost momentum (-0.4ppts to 80.3), with weaker mobility, employment, and health conditions contributing to the slowdown. California's SRT fell to its lowest level since May.
  • East: The region also recorded a loss (-0.4ppts to 87.1), with mobility being the only component that did not decline. New York's SRT declined, while Pennsylvania and New Jersey held steady.
  • Midwest: The region eked out a slight gain (+0.2ppts to 89.3), driven by improved mobility and activity, despite a decline in health conditions and weaker employment.

• Covid-19 Impact:

  • New cases have increased significantly since early July, raising concerns about a potential slowdown in the recovery.
  • However, vaccine uptake has accelerated, with 75% of adults having received at least one dose, which is helping to reduce the economic vulnerability to the virus.

• Delta Variant Concerns:

  • The Delta variant is contributing to a new wave of infections, particularly in the South, but vaccine progress offers hope that severe restrictions may be avoided.

• Supply Chain Constraints:

  • Ongoing supply chain disruptions and logistical bottlenecks are impeding production activity, leading to uneven economic recovery across regions.

Conclusion

The US recovery is showing signs of slowing, with the national Recovery Tracker plateauing in July. While consumer demand and mobility have improved, health conditions and production activity remain key challenges. The regional performance highlights uneven recovery, with the South experiencing the most significant setbacks. However, the high vaccination rate and improved financial conditions provide some optimism for continued economic healing.