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March 2019

National & Regional Economy

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National Economy

  • Real gross domestic product (GDP) increased at an annual rate of 2.6 percent in the fourth quarter of 2018, according to the initial estimate released by the Bureau of Economic Analysis.
  • Overall growth in fourth quarter GDP reflected positive contributions from personal consumption expenditures (PCE), nonresidential fixed investment, private inventory investment and government spending, and negative contributions from net exports and residential fixed investment.
  • Real PCE increased at an annual rate of 2.8 percent in the fourth quarter of 2018, which was a decline from the 3.5 percent growth reported in the third quarter.
  • Real private nonresidential investment growth picked up in the fourth quarter to 6.2 percent, up from the annual rate of 2.5 percent reported in the third quarter of 2018. At the same time, real private residential investment contracted 3.5 percent, compared to the 3.6 percent decline reported in the previous quarter.
  • Inflation, as measured by the consumer price index (CPI), decelerated for the fourth straight month, slowing to a 12-month change of 1.5 percent in February. Meanwhile, year-over-year growth in core CPI, which excludes food and energy, ticked down 0.1 percentage point in February to 2.1 percent.
  • Total nonfarm employment was little changed in February as employers added 20,000 net new jobs (0.0 percent) to the economy. On a year-over-year basis, payroll employment increased 1.7 percent in February. Meanwhile, the unemployment rate declined 0.2 percentage point to 3.8 percent in the month while the labor force participation rate held steady at 63.2 percent.

Sources: Bureau of Economic AnalysisBureau of Labor Statistics

Regional Economy

  • Our most recent surveys suggested fairly steady growth in both the manufacturing and the service sector in the Fifth District in March. The manufacturing composite diffusion index registered a value of 10 in March while in the service sector the overall revenues index declined but remained positive at a reading of 5. Survey results suggested continued employment growth in both sectors.
  • Total nonfarm employment declined slightly in the Fifth District in February as 5,700 jobs were cut, on net, in the month. Job losses were reported in every District jurisdiction except North Carolina and West Virginia, where 3,800 jobs and 100 jobs were added, respectively.
  • On a year-over-year basis, payroll employment in the Fifth District grew 1.1 percent, with the strongest growth of 2.4 percent coming from West Virginia and the weakest growth of 0.5 percent coming from both D.C. and Maryland.
  • The unemployment rate in the Fifth District was unchanged at 3.6 percent in February, but declined 0.4 percentage point compared to last February. Unemployment rates held steady or edged slightly higher in February among all District jurisdictions and ranged from 2.9 percent in Virginia to 5.5 percent in D.C.
  • Since January 2018, home prices in the Fifth District grew 3.1 percent, trailing the national increase of 4.4 percent. Home prices increased over the year in every jurisdiction. West Virginia saw the fastest year-over-year home price growth (6.0 percent), while the slowest growth was reported in Maryland (1.9 percent).

Sources: Snapshot, Regional Economy, Bureau of Labor Statistics, CoreLogic

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