This coming week we’re going to get a bunch of economic data that will show whether the US economy is really taking off or not.
But regardless of what it shows, we know that some parts of the economy are already VERY hot.
This week the Philadelphia Fed released its map showing the economic strength of the states, measuring each one by indicators such as employment growth, wage growth, average work-week, and the unemployment. The greener the state, the stronger the data. Anyway, some parts of the US economy are VERY hot.
Neal Dutta of Renaissance Macro wrote in an email to clients pointing out how fast some of the state accelerations have been:
Let’s run through some of the details for May. California, roughly 15% of US GDP, is up 4.1% annualized. Texas, roughly 10% of US GDP, rose 7.1% annualized. New York, which is about 8% of US GDP, is up 2.6%. The neighbouring states of Pennsylvania and New Jersey, about 7% of US GDP together are up 6.3% and 3.3%, respectively. As a whole, the United States rose 3.4% annualized in May and is up 3.2% so far this year. Over the last three months, about 84% of the country is in an expansion.
Remember these numbers if you hear anyone continuing to talk about the weak Q1 GDP. Not only is the economy growing, some parts are already really seeing the accelerator being pressed.
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