This Week's State Of The Economy - What Is Ahead? - 13 August 2021

By: Taro Chellaram /Wells Fargo Economics & Financial Report/Aug 19, 2021

This Week's State Of The Economy - What Is Ahead? - 13 August 2021

Census numbers dropped this week, and although Houston was the second fastest growing major city in the U.S. the last decade, at 9.8% (Phoenix was first at 11.2%), we didn’t quite catch Chicago to officially take over as the 3rd largest city in the U.S.  We’ll get ’em next time.  Meanwhile, the CPI data this week showed that the sharpest monthly consumer price hikes may be behind us, but inflation is not about to quietly fade away.

Ongoing supply constraints for products and labor, rising costs and renewed risks around COVID weighed on small business optimism in July and on the Wells Fargo Economics team’s outlook for growth, which includes an expectation for a 7.3% annual rate rise in Personal Consumption Expenditures (“PCE”) for Q3, down from 8.3% before the COVID Delta variant began its current run. 

That is expected to pull PCE back to 8.7% for the year, versus the prior 9.0% expectation.  The general outlook remains positive as households have accumulated over $2T in excess savings on their balance sheets and net worth has risen across all income groups.




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