Dec. 9-13: Inflation heats up, business optimism rises, & more
This week brought us a critical—and frankly disappointing—update on inflation, new information on surging small business optimism, and more.
Monday
TSA Checkpoint Travel Numbers
Travel volumes have fallen off from the Thanksgiving rush, according to TSA data. Despite the decline, air travel is about 4% higher over the past week than in 2023. This will go down as a most excellent year for travel in America, as passenger volumes rose, hotel occupancy expanded, and as airlines and cruise lines fared well. The big question is whether a consumer that has been hit hard by inflation over the past three years can keep spending the way they have.
Gas Prices & Diesel Prices
Gas prices fell to $3.13/gallon this week. That’s (again) the lowest price since mid-2021. Diesel prices fell pretty sharply, down to $3.46/gallon. All of that is great for shopping and shipping costs this holiday season.
Tuesday
NFIB Small Business Optimism Index
Last month, I predicted that small business optimism would surge because of election results. Sure enough, this index rose to its highest level since mid-2021. Small business swings hard to the right.
Softer index components (that is, the ones that don’t involve concrete plans) improved dramatically. The hard components (like cap ex or hiring plans) improved only modestly. While business confidence has surged, election uncertainty has become policy uncertainty.
I think it’s pretty safe to deduce that hard components of this measure reflect actual business expectations, while the soft components reflect who’s in the White House.
Wednesday
Consumer Price Index (INFLATION)..,
