A new report, Quarterly Economic Outlook Planning For First Quarter of 2018, conducted for PMMI Business Intelligence by ITR, says the majority of segments of the US core economy are expanding, and leading indicators corroborate expectation of accelerating growth into the first half of 2018. Rising global demand and higher commodity prices contributed to growth in US Non-defense Capital Goods New Orders and both US Wholesale Trade of Durable Goods and Nondurable Goods.
The report says to plan for increasing volume and higher costs over the next three quarters if your business is related to the industrial economy. US Industrial Production is accelerating, up 1.3% year over year in October. The manufacturing and mining components of US Industrial Production are expanding while the utilities sector declines.
US consumers are finding themselves in an optimal economic situation consisting of rising real wages, low unemployment, low inflation, low interest rates, a rising stock market, and relatively-low commodity prices.
One market not showing such a positive outlook was pharmaceutical and medical device production.
US Pharmaceutical and Medical Devices Production during the 12 months through September was down 2.3% compared to the year-ago level. Production is trending within the forecast range, which is unchanged since the previous report.
Production was set to transition to a rising trend by year-end 2017 and will rise through 2018. Predicted industry growth in 2018 is 2.1% (see graphic). Decline will then characterize the majority of 2019.
US Pharmaceutical and Medicine Production transitioned to a recovery trend in July and is expected to begin accelerating upward in the first quarter of 2018. This corroborates our forecast for Pharmaceutical and Medical Devices Production to begin rising imminently.
US Personal Consumption Expenditures for Pharmaceutical and Other Medical Products, an eight-month leading indicator, is up 4.8% year over year (quarterly data). Rising Personal Consumption Expenditures will provide upward momentum for Production into at least the second quarter of 2018.
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