US manufacturing slump deepens, factory gate price pressures subdued
U.S. manufacturing slumped further in June, reaching levels last seen when the nation was reeling from the initial wave of the COVID-19 pandemic, but price pressures at the factory gate continuedtodeflate,asilverliningfortheeconomy.
Shrinking activity left factories resorting to layoffs, the survey from the Institute for Supply Management (ISM) showed on Monday. ISM Manufacturing Business Survey Committee Chair Timothy Fiore described the practise as happening "toagreaterextentthaninpriormonths."
The ISM's manufacturing PMI dropped to 46.0 last month, the lowest reading since May 2020, from 46.9inMay.Thatmarkedtheeighthstraightmonth that the PMI stayed below the 50 threshold, which indicatescontractioninmanufacturing,thelongest suchstretchsincetheGreatRecession.
The ISM survey showed that transportation equipment was the only one of the six biggest industriesreportinggrowthlastmonth.Butevenso, makers of transportation equipment expressed worries that second-quarter sales could decrease andboostinventorylevels.
Souce:
https://www.reuters.com/markets/us/us-manufacturing-extends-slump-june-ismsurvey-2023-07-03/
A California company has received FAA certification for its flying car
Fordecades,futuristshavedreamedofflyingcars, with little real-worldprogress. Now,one company has gotten a step closer to making that vision a reality, receiving government approval to test-fly itssportscar.
Alef, a California-based aeronautics company, recently announced it received a Special Airworthiness Certification from the Federal AviationAdministration,allowingittoflythecarin limitedlocations.
The company's Armada Model Zero aircraft received the certification on June 12, the FAA told CBS MoneyWatch. "This certificate allows the aircraft to be used for limited purposes, including exhibition, research and development. This is not the first aircraft of its kind for which the FAA has issued a Special Airworthiness Certificate," the agencysaidinastatement.
Itcanalsotakeoffverticallyandflythroughtheair inanydirection,thecompanysaid.Thevehiclehas a flying range of 110 miles, and a driving range of 200,accordingtoAlef.
Workers are still raiding their retirement savings at record rates
Thirty-seven percent of workers have taken a loan, early withdrawal, and/or hardship withdrawal from their 401(k) or similar plan or IRA, according to a survey released by the nonprofit Transamerica Center for Retirement Studies (TCRS) in collaboration with the Transamerica Institute. That matches 2022’s level, which is also the highest level inthehistoryofthesurvey.
Those withdrawals underscore why many workers have a pessimistic outlook for their retirement as they grapple with a lack of emergency funds and stretched household budgets that have forced them to tap their nest eggs. The practice could become even more prevalent as new rules make it easiertodoso.
Forinstance,in2022,2.8%of401(k)planparticipants took a hardship withdrawal, a record high, up from 2.1% in 2021 and 1.9% in 2018, according to a recent Vanguardreport.
Andinthefirstthreemonthsof2023,thenumberof plan participants taking hardship withdrawals jumped 33% from the same period a year earlier, with workers taking out an average of $5,100 each, accordingtoaBankofAmericareport.
Souce: https://finance.yahoo.com/news/workers-are-still-raiding-their-retirement-savings-
Mortgage rates jump to 6.81%, their highest level this year
USmortgageratesjumpedupthisweekasrecent economic data showed inflation remains sticky andthejobmarketisstillredhot.
The30-yearfixed-ratemortgageaveraged6.81%in the week ending July 6, up from 6.71% the week before, according to data from Freddie Mac released Thursday. A year ago, the 30-year fixedratewas5.30%.
“Mortgage rates continued their upward trajectory again this week, rising to the highest rate this year so far,” said Sam Khater, Freddie Mac’schiefeconomist.“Thisupwardtrendisbeing driven by a resilient economy, persistent inflation and a more hawkish tone from the Federal Reserve. These high rates combined with low inventory continue to price many potential homebuyersoutofthemarket.”
Nearly 82% of home shoppers reported feeling “locked in” by their existing low-rate mortgage, according to Realtor.com, while around 1 in 7 homeowners without a selling plan cited their current low rate as their reason for remaining on thesidelines.
US economy adds 209,000 jobs in June as hiring slows
TherisewastheweakestgainsinceDecember2020,lowerthanthe240,000jobseconomistshadexpected and lower than the 309,000 jobs added in May. But the increase was also the 30th consecutive month of jobsgains,andtheunemploymentratetickeddowntothehistoricallylowrateof3.6%.
The US job market has remained robust despite the Federal Reserve’s aggressive attempts to slow the economy and tamp down inflation with more than a year of interest rate hikes. The Fed chair, Jerome Powell,hasindicatedthatthecentralbankwilllikelyraiseratesagainthismonthafterannouncingapause inJune. Wagesrose4.4%inJunefromayearearlier.
Inanotetoinvestors,CapitalEconomicssaidthe209,000rise“suggestslabourmarketconditionsarefinally beginning toease more markedly.Thatsaid, it is unlikelytostoptheFed fromhiking rates again later this month”.
ThelatestfiguresfromtheBureauofLaborStatisticscomeaftertheprivatesectorreportedasharperthan expected rise in hiring in June. Private employers added 497,000 new jobs last month, the private payroll supplier ADP reported on Thursday, well ahead of the 267,000 gain in May and much better than the 220,000 analysts had estimated. The near half-million rise was the largest monthly increase in over a year withleisureandhospitalityjobsaccountingforthelargestvolumeofhires.
Souce:
https://www.theguardian.com/business/2023/jul/07/june-jobs-report-2023-unemployment-rate