Despite a disappointing start to 2015 with -0.2 GDP change in the first quarter, economic analysts are confident that America's GDP growth will hover just over 3 per cent for the rest of the year, says the Confederation of British Industry (CBI).
Jobs created in June reached 223,000 and the unemployment rate fell to the lowest point in seven years at 5.3 per cent. Unfortunately, the labor force participation rate dropped to 62.6 per cent, which shows the change in unemployment is due to Americans retiring or simply not looking for work, according to a CBI report on the US economy.
Manufacturing growth exceeded expectations in June. The index of national factory activity rose to 53.5, the highest level since January according to the Institute for Supply Management. However, the industry continues to struggle with the lasting effects of dollar strength and lower energy prices.
Oil prices declined across the US after two months of consistent increases. Regular grade petrol cost an average of $2.85 a gallon which is an impressive 86 cents lower than prices in June last year.
Consumer confidence increased significantly according to the Conference Board. The index of consumer attitudes rose to 101.4 in July from 94.6 in May. Experts attribute this to the decline in gas prices and the perception of a strong labor market.
Appreciation in the housing market has gradually slowed since April. This will likely ease concerns about affordability and encourage first time buyers. The National Association of Home Builders and Wells Fargo Housing Market Index indicate Builder Confidence reached a yearly high in June. The housing market is expected to continue to improve as the labor market experiences wage growth.