“Stronger activity will help to support firms’ ability to
raise prices modestly, very modestly,” said Jade Zelnik, chief
economist at RBS Greenwich Capital in Greenwich, Conn. “It
could help firms continue to repair profit margins.”
The U.S. government was able to produce its reports Friday
because Washington escaped Thursday’s power blackouts that swept
through the Northeast United States and Canada. The University of Michigan is expected to delay its August consumer sentiment report until Tuesday.
Rhode Island's Market Has Changed. Developers, Builders, Investors and Sellers Must Change With It.
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New York and other cities began to regain power Friday and
businesses tried to resume operations after the biggest power
failure in North American history. The adverse effects on monthly
gauges of activity will be minimal and the economy may get a boost
from sales of emergency items and investment in new power
generating systems, economists at Banc One Corp. and Bear Stearns
& Co. said.
The pickup in production may extend into this month as well.
Manufacturing in New York state expanded in August, albeit at a
slower pace than in July. A factory index compiled by the Buffalo
branch of the Federal Reserve Bank of New York registered 9.98
this month, after a revised 20.83 for July. Values greater than
zero signal most manufacturers reported improved business.
The consumer price index matched the median of 64 forecasts in a Bloomberg News survey, while the core index that excludes
food and energy rose 0.2 percent, more than the forecast 0.1
percent. Industrial production exceeded the median forecast of a
0.2 percent increase.
Gasoline prices rose in July amid concern that production
wasn’t growing fast enough to keep up with summer travel demands,
and cash-strapped states are raising tuition at public
universities. The increase in consumer prices came after the Fed
in June cut interest rates to the lowest in 45 years to prevent
deflation, or a broad-based decline in prices.
So far this year, consumer prices have been rising at a 2.2
percent annual rate. For all of last year, prices rose 2.4
percent, the Labor Department said.
Bloomberg News
