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• Global Business Confidence
• Global business sentiment remains weak and fragile. The survey results suggest that the global economy is skirting recession, but just barely. The U.S., European and Japanese economies are contracting according to the survey results, but the Asian economy continues to post growth that is near its potential. Businesses are notably worried about sales and their broad assessments of present conditions and the outlook into 2009 remain firmly negative. Pricing pressures continue to be very elevated, but have moderated a bit with the recent decline in energy and other commodity prices.

• FOMC Meeting
• As expected, the Federal Open Market Committee held the fed funds target rate steady at 2%. This is the second straight meeting with no change in the target rate. The committee's statement cited the weakening labor market and financial market stress. The statement also discussed high inflation; although the FOMC expects inflation to decline in the months ahead, the members said "the inflation outlook remains highly uncertain." The statement acknowledged both downside risks to growth and upside risks to inflation. This would indicate no near- term change in monetary policy. Dallas Fed President Richard Fisher voted against the action, preferring a rate increase.

• Productivity and Costs
• Friday's productivity and costs numbers came in worse than expected on the productivity side but better than expected on the cost side. On net, it is a positive report that augurs well for margins and stems inflation fears.

• Wholesale Trade (MWTR)
• Wholesale inventories rose by 1.1% in June, surpassing consensus expectations, following an upwardly revised 0.9% gain in May. Sales rose by 2.8% in June compared with an upwardly revised 2.2% rise in May. The inventory-to-sales ratio fell two- hundredths of a point from an unrevised 1.08 to 1.06 in June.

• Construction Spending (C30)
• Construction spending fell by 0.4% from May to June, a figure expected by most forecasts. For the first six months of 2008, construction spending was 5.4% below the total for the first six months of 2007. Most of the fall in spending from May to June was in private residential construction, though nonresidential construction also started to slow as a result of the economic downturn.

• Factory Orders (M3)
• New orders for factory goods rose 1.7% in June. The stronger than expected increase owed to a 2.5% increase in orders at nondurable manufacturers. Most of this increase occurred at petroleum refiners and chemical factories as commodity prices continue to boost nominal values. The news in the report regarding capital spending was also encouraging, although capital goods orders were revised slightly lower.

• Semiconductor Billings
• Global semiconductor sales rose 0.5% in June to $21.57 billion on a three-month moving average basis. If not for falling chip prices, sales would have grown at a double-digit pace. Sales are now 8% higher than in June of last year, with gains seen in all regions of the world.

• Employment Situation
• The economy lost fewer jobs than expected in July, but it is certainly not out of the woods. Payrolls fell by 51,000, while losses for the previous two months were revised downward. However, the unemployment rate, derived from the household survey, increased by 20 basis points, to 5.7%. Workers put in fewer hours in July as well, with further implications for income growth. Losses in goods-producing industries abated somewhat compared with June, but employment in service-providing industries declined. The economy lost fewer jobs than expected in July, but it is certainly not out of the woods. Payrolls fell by 51,000, while losses for the previous two months were revised downward. However, the unemployment rate, derived from the household survey, increased by 20 basis points, to 5.7%. Workers put in fewer hours in July as well, with further implications for income growth. Losses in goods-producing industries abated somewhat compared with June, but employment in service-providing industries declined.

• Personal Income
• Personal income inched up 0.1% in June after soaring 1.8% in May. Income growth was hurt by a reduction in the quantity of tax rebates counted as transfer income. Excluding the tax rebate effect, personal income rose 0.3% in June, up from 0.4% in May. Spending growth slipped to 0.6% from 0.8% the prior month. Real spending fell 0.2% as prices soared. The core PCE deflator rose 0.3%, the fastest since September, while the top-line deflator jumped 0.8%. The saving rate fell back to 2.5% from 4.9% in May but remained inflated by rebates.

• Jobless Claims
• Initial claims for unemployment insurance benefits increased 7,000 to 455,000 for the week ending August 2. Although expectations had been for claims to remain high, this figure exceeds them. A large portion of this is due to the extension of UI benefits, and thus does not necessarily suggest a severe loosening in the labor market.

• Job Cuts
• Job cut announcements have been trending higher in recent months and reached 103,312 in July. This is more than twice as many as a year ago. They have averaged 96,000 during the past three months. Transportation and financial services accounted for the highest number of cuts during the month and financial services led all others year to date.

• Consumer Credit (G19)
• Total consumer credit outstanding increased by $14.3 billion in June to a total of $2.586 trillion. This was the largest monthly increase so far this year. Both revolving and nonrevolving lines of credit increased at similar rates.

• Pending Home Sales
• The pending home sales index rose 5.3% in June to 89. The increase from May's downwardly revised number places the index just above its April high. The rise came as a surprise. The consensus had expected a month-ago decline of 0.5%. The rise in pending sales suggests that existing-home sales may have risen in July.

• MBA Mortgage Applications Survey
• The market composite indices finished up for the week ending August 1, as mortgage demand rallied for the first time in four weeks. The market index finished up by 2.8%. Most of the gain in the market index came from refinancing-the refinance index increased by 4.4%, but the purchase index also had a modest 1.8% gain for the week. Also, contract rates fell slightly.

• Vehicle Sales - AutoData
• July was an awful month for the U.S. vehicle industry. Vehicle sales fell to 12.5 million units on a seasonally adjusted annual basis, down from 13.6 million units in June, which was considered to be terrible. The last time sales were as low as they were in July was during the recession of the early 1990s. The main drag, of course, came from sales of SUVs, vans and pickup trucks, which fell sharply. Vehicle sales were off 13% in July from a year ago; light truck sales were 25% lower.

• Chain Store Sales
• Chain store sales rose 2.6% in July, in line with or slightly below expectations. Rising gasoline prices also played a role in the strength, lifting sales at warehouse clubs. Rebates continued to support sales. Discounters, particularly Wal-Mart, outperformed as financially pressed consumers focused on necessities and lower-priced goods.

• Oil and Gas Inventories
• Crude oil inventories rose by 1.7 million barrels for the week ending August 1, according to the Energy Information Administration, more than expectations of a 0.3 million barrel increase. Gasoline inventories fell sharply by 4.4 million barrels, far surpassing estimates of a 1.2 million barrel decline. Distillate supplies rose by 2.8 million barrels, surpassing expectations. Refinery operating capacity unexpectedly fell. Total domestic petroleum was unchanged. This mixed report is mildly bullish.

• Natural Gas Storage Report
• Working gas in underground storage rose by 56 billion cubic feet during the week ending August 1, slightly below consensus expectations of a 60 bcf increase. Inventories remained well below their year- ago level but only slightly below their five-year average for this time of year.