February’s Industrial Heating Equipment Association’s (IHEA) Executive Economic Summary suggests, “The numbers revealed in this month’s index will someday be remembered as the ‘good old days.’ This will be the last version that can be termed “PCV” or pre-corona virus.” The report continues, “It will be important to look back on the last couple of months and remember that conditions looked pretty decent at the start of the year.”
The three indices that are trending positive include new automobile and light truck sales which reveal strongly that consumers favor their new vehicles. There was also a nice boost in steel consumption which suggests that there has been more construction activity in the public sector. Additionally, despite the threat, consumers remained active as factory orders were also up slightly.
While eight indices are trending downward, the summary reports, “The semi-good news is that several of the negative readings are only slight in that category.” The biggest declines were seen in “metal prices (and commodities in general) as well as capital expenditure, credit and transportation. The only one that really crashed hard was capital expenditure and that is partly due to the slump in manufacturing that started last year.”
A little less dramatic in declines are the housing market, which still remains healthy although new home starts are down; and, capacity utilization, that has been sinking, but “is still not all that far off the pace considered normal.” The durable goods numbers and the data from the Purchasing Managers’ Index also slowed down, but not significantly.
“The next month will show drastic reductions in business activity in many sectors and the job losses will start to mount. The hope on the horizon is that COVID-19 behaves like others of its kind and starts to fade as the weather warms. If the worst of the impact is in March and April the recovery will be obvious by June and July.” states the report.
It is an uncertain time for everyone, and we can all resonate with this concluding thought, “It is hard to say what these numbers tell us. This is uncharted territory for the US.”
The report is available to IHEA member companies. For membership information and a full copy of the 12-page report, contact Anne Goyer, Executive Director of the Industrial Heating Equipment Association (IHEA). Email Anne by clicking here.
