On Wednesday, the economic calendar was packed with various economic indicators and events.
One of the most notable was the publication of the ADP National Employment Report, which showed that private sector employment increased by 179,000 jobs in July, slightly below analysts’ expectations. However, the report also revised the June figure upward to 194,000, indicating that the labor market is still growing, albeit at a slower pace. The ADP report is seen as a reliable precursor to the government’s official jobs report, which is due to be released on Friday.
Another important report was the Institute for Supply Management’s (ISM) non-manufacturing index, which measures activity in the services sector. The index fell to 53.7 in July, down from 57.1 in June, indicating that the pace of growth in the sector has slowed. This was a surprising result, as analysts had expected the index to remain steady. However, the report showed that employment in the services sector continued to rise, which is a positive sign for the labor market.
In addition, the Energy Information Administration (EIA) released its weekly report on crude oil inventories, which showed that oil stocks had fallen by 8.9 million barrels, the largest drop since September 2017. This was partly due to a decline in imports, but also reflected strong demand for oil as the summer driving season continues. The news pushed oil prices higher, with Brent crude rising above $74 a barrel, the highest level since November 2018.
Finally, the Federal Reserve’s Beige Book, which provides a snapshot of economic activity across the United States, was released on Wednesday. The report indicated that the economy continued to expand at a modest pace in most regions, although there were concerns about the impact of trade tensions and tariffs on some industries, particularly agriculture and manufacturing. The report also noted that there were some signs of slowing activity in the housing sector, but that consumer spending remained strong.
Overall, Wednesday’s economic calendar showed a mixed picture of the US economy. While the labor market is still growing, activity in the services sector has slowed, and there are concerns about the impact of trade tensions on some industries. However, the sharp drop in oil inventories is a positive sign for the energy sector, and consumer spending remains strong. The Federal Reserve will no doubt be closely monitoring all these indicators as it considers its next move on interest rates.