So, do you think we might be in a recession today (Part IV)?

Tracking Part I, Part IIas well as Part 3.

The weekly Lewis-Mertens-Stock index, based on data from June 25, is still in the positive range.

Source: FREDas of 07/03/2022.

The same can be said for the OECD Weekly Tracker using data up to June 25:

Source: OECDas of 07/03/2022.

The Google Mobility Index is above 2019 levels.

Source: Torsten Slok, “Slowdown Observation”, Apollo, July 2, 2022

Same store retail sales are down, but still on the rise compared to 2019 (and from what I can tell, compared to the 2019 trend):

Source: Torsten Slok, “Slowdown Observation”, Apollo, July 2, 2022

Credit indicators are on the rise, from rising bank loans to outstanding credit card debt. Both point to optimism about immediate conditions.

Source: Torsten Slok, “Slowdown Observation”, Apollo, July 2, 2022

Source: Torsten Slok, “Slowdown Observation”, Apollo, July 2, 2022

What is true is that some general indicators of activity have declined in recent months (namely, monthly GDP, last month’s consumption). However, employment and income ref. current transfers continue to grow. Monthly GDP in particular is sometimes substantially revised, as discussed in this post.

Figure 1: Nonfarm payrolls (dark blue), Bloomberg NFP consensus (blue+), industrial production (red), 2012 dollar non-transfer personal income (green), 2012 dollar manufacturing and trade sales yr (black), consumption in Ch.2012$ (light blue) and monthly GDP in Ch.2012$ (pink), all logarithms normalized to 2020M02 = 0. NBER recession dates, from peak to trough, shaded in gray color. Source: BLS, Federal Reserve, BEA, via FRED, IHS Markit (née Macroeconomic Advisors) (issue 07/01/2022), NBER and author’s calculations.

None of the above comments should be taken to mean that we will not be in a recession anytime soon or by the end of 2023. Really, June IGM-FT Poll indicated that 70% of economists surveyed see a recession next year. (More about the survey in this mail.)