The economy, inflation and how those forces could impact the lives of Americans were front and center over the past week. Trips to the grocery store or gas station are more painful than they were last year, and rising costs are impacting the decisions of both households and businesses.
Here’s a snapshot of prominent economic data and news that occurred over the past week and what it potentially means for you.
US gas prices fall below $4 for 1st time since March
U.S. gas prices fell below $4 a gallon on average Thursday, but just barely.
It is the first time since March that the average cost for a regular gallon has been that low. Prices fell overnight after President Donald Trump signed an agreement with Iran that calls for Tehran to dilute its stockpile of highly enriched uranium and waives U.S.-backed sanctions on the country.
Gas prices are at $3.999 on average in the U.S., according to motor club AAA. The drop below $4 follows a 15% decline in the price of U.S. crude this month.
But fluctuations in gas prices remain across the country. In California, gas prices are averaging $5.64 per gallon, while in South Carolina it’s $3.58 per gallon.
Retail sales edge higher in May
Shoppers increased their spending in May as temperatures warmed and gasoline prices cooled.
Retail sales rose a better-than-expected 0.9%, up from a revised 0.4% gain in April, according to new Commerce Department data released Wednesday. Sales got a boost from generous government tax refunds in both April and May, though economists say that cushion is starting to fade.
Excluding sales at gas stations, retail sales in May rose 0.7%.
The data released Wednesday offers only a snapshot of consumer spending and doesn’t include activities like travel and hotel stays. The lone services category – restaurants – registered a 0.1% decline.
Federal Reserve keeps key interest rate unchanged
The Federal Reserve kept its key rate unchanged Wednesday yet almost half the central bank’s policymakers said they could support a rate hike later this year.
The lack of a shift at the Fed under new Chair Kelvin Walsh would likely disappoint President Trump and suggests heightened concerns about persistent inflation among Fed officials.
In an unusually short statement after their two-day meeting, the officials dropped language that had suggested their next move would be to cut the key rate. The brief statement reflects the influence of Warsh, who was appointed by Trump. Warsh has previously criticized the Fed for commenting too broadly on the economy.
Average 30-year U.S. mortgage rate falls
The average long-term U.S. mortgage rate fell this week, tracking Treasury yields that have retreated since a deal to end the war with Iran was announced.
The benchmark 30-year fixed rate mortgage rate fell to 6.47% from 6.52% last week, mortgage buyer Freddie Mac said Thursday. One year ago, the average rate was 6.81%.
Borrowing costs on 15-year fixed-rate mortgages, often sought by borrowers refinancing a home loan, also came down this week.
Unemployment claims decline as layoffs remain historically low
The number of Americans applying for jobless aid fell modestly last week as layoffs remained in the same historically low range of recent years.
U.S. applications for unemployment benefits in the week ending June 13 dropped by 4,000 to 226,000, the Labor Department reported Thursday. That’s in line with the 225,000 new applications forecast by analysts surveyed by the data firm FactSet.
Weekly filings for unemployment benefits are considered representative of U.S. layoffs and are close to a real-time indicator of the health of the job market.
Wall Street climbs during holiday-shortened week
Stocks rose on Wall Street this week in volatile trading.
The S&P 500, Dow Jones Industrial Average and Nasdaq composite all climbed and edd the week higher. U.S. markets were closed Friday for the Juneteenth holiday.
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