Advisors on This Week’s Show

(with Max Hoelzl, Joel Dresang, engineered by Jason Scuglik)

Week in Review (Jan. 13-17, 2025)

Significant Economic Indicators & Reports

Monday

No major announcements

Tuesday

The Bureau of Labor Statistics reported that wholesale inflation rose 0.2% in December, as prices on goods increased while services were unchanged. The Producer Price Index advanced 3.3% from the year before, the highest since early 2023 but down from the record 11.7% reached in March 2022. Increased interest rates by the Federal Reserve have since lowered inflation, but the December reading, led by a 9.7% jump in gas prices, kept the rate above the Fed’s long-range target of 2% overall. Excluding volatile prices for food, energy and trade services, the so-called core PPI rose 0.1% from November and was up 3.3% from December 2023.

Wednesday

The broadest measure of inflation rose again in December, though it stayed closer to the Federal Reserve Board target than the peak two and a half years ago. The Bureau of Labor Statistics reported the Consumer Price Index, rose 0.4% from November, the most in nine months, fueled by a 4.4% jump in gas prices. The CPI advanced 2.9% from December 2023. That’s up from a recent low of 2.4% in September but less than a third of the 40-year high of 9.1% in June 2022. The Federal Reserve’s long-range inflation target is 2%. Excluding volatile prices for food and energy items, the core CPI rose by 0.2%, down from three months in a row at 0.3%. Year to year, the core measure was up 3.2%, tied with July and August for the lowest rate since early 2021.

Thursday

The four-week moving average for initial unemployment claims fell to its lowest level since April, dropping 41% below the all-time average. An indicator of employers’ reluctance to let workers go, the moving average was 2% above its level just before the COVID-19 pandemic, according to Labor Department data. Meanwhile, total claims for jobless benefits rose 17% from the week before to 2.2 million, affected in part by year-end layoffs. That was up 4% from the year before.

The Commerce Department said retail sales rose 0.4% in December for the fifth increase in six months, though the weakest gain since a setback in August. The advance overall suggested continued resilience in the economy, with 10 of 13 retail categories expanding, led by car dealers and furniture stores. Sales at bars and restaurants fell for the first time since March. Compared to the end of 2023, total retail sales rose nearly 4%, with 11 of 13 categories gaining. Adjusting for inflation, retail sales were up 1% since December 2023.

Friday

The pace of U.S. housing starts rose while building permits slowed in December. The Commerce Department reported the annual rate of new construction climbed nearly 16% to its highest level in 10 months, still below the pre-pandemic pace but on par with early 2007. Meanwhile, the annual pace of permits fell, but authorizations for single-family construction increased for the fourth time in five months, rising above the pre-pandemic rate for the first time since February. The pace of single-family houses under construction slowed for the 13^th month in a row but remained at levels unreached in 50 years.

Industrial production rose in December for the second month in a row and eked out a 0.5% gain from the year before. The Federal Reserve Board cited a boost in output from aircraft manufacturers, following the resolution of a strike at Boeing. Production from factories, mines and utilities all rose from November. Only manufacturing failed to advance from December 2023, having ended the year unchanged. Industries’ capacity utilization rate – an indicator of inflation – also gained for the second consecutive month, though it stayed below its 50-year average for the 22^nd month in a row, suggesting higher prices weren’t imminent.

Market Closings for the Week

Nasdaq – 19630, up 469 points or 2.4%
Standard & Poor’s 500 – 5997, up 170 points or 2.9%
Dow Jones Industrial – 43488, up 1549 points or 3.7%
10-year U.S. Treasury Note – 4.61%, down 0.17 point

Money Talk Podcast, Friday Jan. 17, 2025