August 15, 2024
Stat Spotlight: Inflation’s Last Gasp?
While the economy faces certain headwinds, decelerating inflation, the likelihood of a federal interest rate cut and rising consumer spending are positive signs for the marketplace.
Nate Kucsma, ASI’s senior executive director of research, has said he wouldn’t be surprised if the fourth quarter of 2024 is especially strong for promotional products sales.
Certain marketplace developments may help engender that hoped-for strong finish to the year.
Wild runaway inflation appears to have been tamed finally, consumers have continued to increase their spending and the Federal Reserve is widely expected to cut benchmark interest rates by a quarter percentage point to a half-percentage point in September – a move many economists believe will help stimulate economic activity and contribute to avoiding a recession.
Rising unemployment, a slowdown in hiring and stock market wobbles are undeniable headwinds not to be ignored, but there’s a wealth of positive macro data that provides cause for levelheaded optimism about the economy – a reality that could help promo buyers who’ve been reluctant to spend on merch to begin investing again in the medium. Here’s a look at some key numbers:
2.9%
Annual rise in the Consumer Price Index (CPI) in July 2024 compared to July 2023. The CPI is an inflation gauge measuring what consumers pay. The July reading marked the lowest annual rise since March 2021.(Labor Department)
3.2%
Increase in the core CPI in July 2024 compared to July 2023. Core CPI excludes volatile food and energy prices.(Labor Department)
2.2%
The annual-basis increase in the Producer Price Index (PPI) this July relative to the same month last year. That was down from a 2.7% jump in June. PPI essentially measures what’s paid at the wholesale level.(Labor Department)
2.4%
The core PPI annual increase in July, the lowest reading since March of this year. Core PPI excludes volatile categories, like food and energy.(Labor Department)
2.8%
Annualized rate of gross domestic product (GDP) growth in the second quarter of 2024. That was double the 1.4% rise in the first quarter and beat the forecasts of economists.(Bureau of Economic Analysis)
Consumer Spending
Retail and food services sales in the U.S. increased 2.7% year over year in July and were up 1% over June, the prior month.(Census Bureau)
2.4%
Researcher Deloitte’s prediction for the real GDP growth of the U.S. economy for the whole of 2024. Annual growth will slow to 1.1% in 2025 but tick up above 1.5% between 2026 and 2028, Deloitte says.(Deloitte)
114,000
Number of jobs U.S. employers added in July 2024, down significantly from the 206,000 positions added in June of this year.(Labor Department)
4.3%
The U.S. unemployment rate at the end of July. That was the highest level since late 2021, but still not far above historical lows, analysts said.(Labor Department)
227,000
The number of initial unemployment claims filed the week ending Aug. 10. That’s a decrease of 7,000 from the previous week.
1.3%
Average collective year-over-year increase in sales that promotional products distributors engineered in Q2 2024 compared to Q2 2023.(ASI Research)