The “advance” estimate for U.S. real gross domestic product (GDP) for the first quarter of 2017 grew at a weaker-than-expected 0.7 percent annualized rate. The biggest positive contribution came from private domestic investment, while consumer spending posted the slowest growth since the end of the Great Recession based on incomplete data. Weak consumer spending, in spite of high consumer confidence, mainly reflected fewer auto sales, which most analysts believe to have already passed its peak. The unemployment rate ticked down to 4.4 percent from March to April, which is the lowest level since early 2007. February retail sales continued a strong 5.2 percent year-over-year increase. March housing starts also increased markedly by 9.2 percent from a year ago; the seasonally adjusted housing price index continued a robust 5.7 percent year-over-year gain. The Federal Reserve decided to keep its benchmark rate unchanged in May, but hinted they will probably raise the interest rate two additional times in 2017.
The Nevada economy posted generally positive economic activity based on the most recent data. The unemployment rate fell to 4.8 percent, the lowest since October 2007. Taxable sales in February posted a robust 4.8 percent year-over-year increase. The gain reflected a thousand-fold jump in sales in Storey County due to the operation of the Tesla Gigafactory, Switch and many others at the Tahoe-Reno Industrial Center (TRIC). Gasoline sales (in gallons) fell by 4.7 percent during the same period. Gaming revenue and total air passengers in March increased by 7.4 and 4.0 percent, respectively, compared to last year.
The Clark County economy also exhibited generally positive signals on its economic outlook. The unemployment rate edged down to 4.9 from 5.0 percent in March. March visitor volume for Clark County was the second highest number after July 2016, up by 1.5 percent year-over-year, which is mainly boosted by a 13.3 percent yearly gain from the number of Las Vegas convention attendees. Residential housing permits and commercial permits in February decreased substantially by 58.2 and 32.6 percent, respectively, from last year.
Washoe County also experienced generally positive signals for its economy. The unemployment rate fell to 4.0 percent for the month, the lowest level since early 2007. Taxable sales for Washoe and Storey Counties in February increased substantially by 24.5 percent from a year ago. Residential housing permits in February posted a large 36.1 percent decrease compared to February 2016.
Stephen M. Miller, Director, Jinju Lee, Economic Analyst, UNLV Center for Business and Economic Research