The “second” estimate for U.S. real gross domestic product (GDP) for the fourth quarter of 2017 rose at an annual rate of 2.5 percent, down slightly from the previous estimate of 2.6 percent. The revision reflected a smaller private inventory investment than previously reported. Consumer spending accelerated to the fastest pace in a year, and business investment, residential investment, and government spending also contributed positively to real GDP growth. Private inventory investment and net exports, however, contributed negatively to growth. U.S. nonfarm employment added a surprising 313,000 jobs in February, substantially larger gains than expected. The pace of retail sales growth slowed in January, up by 3.6 percent in spite of highly favorable consumer confidence. January housing starts increased by 7.5 percent year-over-year, and seasonally adjusted housing prices in the United States continued to gain. Historically high business and consumer confidence, tightening labor market conditions, and favorable fiscal stimulus suggest four interest rate hikes by the Fed in 2018.
Nevada posted generally positive signals in economic activity based on the most recent data. Seasonally adjusted statewide employment added 1,300 jobs in January. Taxable sales and gasoline sales (in gallons) in December grew by 2.3 and 3.6 percent, respectively, year-over-year. January gaming revenue declined by 2.0 percent compared to a year ago as the Lunar New Year fell in February in 2018.
For Clark County, somewhat mixed signals emerged with the latest data. Seasonally adjusted employment lost 300 jobs from December to January. January visitor volume for Clark County continued its year-over-year loss of 2.9 percent, while total McCarran Airport passengers increased by 2.7 percent during the same period. January gaming revenue continued its yearly decline of 3.7 percent, mainly due to an 8.9 percent loss in the Las Vegas Strip. Clark County taxable sales and gasoline sales for December climbed by 3.1 and 2.2 percent, respectively, relative to last year. November residential housing permits were up strongly by 41.1 percent year-over-year.
Favorable signals were posted for Washoe County. The Reno-Sparks seasonally adjusted employment gained 200 jobs from December to January and rose robustly by 4.5 percent from last year. December taxable sales for Washoe and Storey Counties decreased by 3.3 percent year-over-year. December visitor volume was up by 4.2 percent from a year ago. Residential housing permits in December continued a significant year-over-year gain of 153.5 percent.
Stephen M. Miller, Director
Jinju Lee, Economic Analyst
The views expressed are those of the authors and do not necessarily represent those of the University of Nevada, Las Vegas or the Nevada System of Higher Education.