U.S. Economy Posts Three Positives

Bad news, it's said, comes in threes. But good news can, too, if three positive U.S. economic reports released July 14 are an indicator.

First, retail sales for June were a seasonally adjusted $350.8 billion, 1.7% higher than May's figure and 9.6% better than the mark for June 2004, the U.S. Commerce Department said.

Second, as a result of an increase in average hourly earnings, inflation-adjusted average weekly earnings for private-sector production and non-supervisory workers rose two-tenths of a percentage point between May and June, the U.S. Labor Department said.

And third, the closely watched Consumer Price Index (CPI), a key measure of inflation in the U.S., was unchanged in June, the Labor Department said. Even the so-called core CPI, a measure that excludes often-volatile month-to-month changes in the prices of food and fuel, rose just one-tenth of a percentage point, continuing "a trend of a favorable readings," notes Peter Morici, a professor at the University of Maryland's Smith School of Business in College Park.

The only seemingly economic negative from the Feds on July 14 was the Labor Department's report that initial claims in the U.S. for unemployment insurance increased to 336,000 last week, up 16,000 from the previous week. However, the department's four-week moving average of initial claims, often regarded as a better reflection of underlying labor market conditions because its smooths out week-to-week swings, edged up only 250 claims to 320,750 for the week ending July 9.

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