Blue World Economic Index™
Released Monday, August 31, 2015 for August 2015
The Blue World Economic Index™ remains fractionally negative for August 2015 at -.06.vs a -.14 in July. Three out of the eight major categories were negative including Employment, Inflation and Manufacturing while Real Estate made it back above zero for the month joining General and Consumer measures, Services and Retail Sales.
We’ve been asked why Inflation is receiving a “negative” index assignment when it is so low. It is true that rising inflation can be the enemy of growth but when it runs too low for too long it is more an indication of weak demand as has been the case now for several years. We don’t want to see run-away inflation develop but some steady pricing pressure to indicate growing demand would be a welcome change.
We continue to believe a rate hike is not imminent and the Fed will require a great deal more evidence of strengthening.