While durable goods spending is growing at its fastest rate since March 2016, the increasing year/year change in the 10-year treasury rate indicates that durable goods spending has hit its peak rate of growth.
The growth rate remains above average, but it is moderating.
Annual growth in real disposable has been below 2.0 percent for a number of months. As the chart shows, this rate of growth is typically indicative of a recession.
Consequently, the annual rate of growth in disposable income decelerated to 1.3 percent, the slowest since August 2014.
Data from the Gardner Business Index (GBI) for August increased from the prior month to 55.0, bringing the index closer to its year-to-date index average to 55.3. Gardner Intelligence’s review of the data indicate that supplier deliveries, new orders, and production lifted the business index higher while employment, backlog and exports pulled the index lower. The only component that contracted for the month was exports. In the year-to-date and one-year ago periods, the GBI is up 8.7 percent and 12.2 percent respectively.
