• U.S. mobility dipped in April as COVID-19 cases rose, though the caseload remains comparatively low.
• Spending remains steady despite high prices and lower consumer sentiment.
• The 10-year forward inflation rate remains near an all-time high.

Virus and mobility

COVID-19 cases:  As of April 26, on average new daily cases in the U.S. stood at 52,340, up by almost 35% over the previous seven days. However, the count remained 22% below the level seen two months prior and 94% below its Jan. 15 all-time high. The average daily number of deaths continued to decline, hitting 359, down by 7% over the previous seven days and by 86% from the Feb. 10 peak. About 66% of the total U.S. population is fully vaccinated, while 77% has received at least one dose.

Mobility:  Mobility in the retail and recreation subindex nationally was 11% below the pre-pandemic baseline as of April 18. However, this was a 10-percentage-point (ppt) improvement from Jan. 7. Recurrence of COVID-19 has kept some milder restrictions in place, as reflected by the Oxford Stringency Index, which was at 58.8 (100=strictest) as of April 26--stricter than all other countries that we track except China, which was at 75.5%.

People-facing COVID-19-sensitive

OpenTable:  Seated diners at restaurants nationally were just 0.71% below the pre-pandemic level as of April 23 as most states lifted capacity constraints and mask mandates. Florida and Texas are operating at 25% and 23% above pre-pandemic levels, respectively. Despite withdrawal of stricter COVID-19 restrictions, some states, like New York and Illinois, still show dining below pre-pandemic levels (by 30% and 24%, respectively).

Air traffic:  The air traffic recovery in the U.S. seems to have stabilized just under the 2019 rate. Travelers passing through Transportation Security Administration checkpoints were just 9% below the pre-pandemic level as of April 23. Lagging corporate travel--particularly long-haul travel--has prevented a full recovery.

Hotel occupancy:  The occupancy rate has hovered around its 2019 average (66.1%) in the past six weeks. As of April 23, the rate was 65.8%. As the omicron wave subsided, leisure travel gained momentum, pushing the hotel occupancy rate higher.

Current and future activity

Johnson Redbook Same-Store Sales Index:  For the week ended April 23, the same-store sales index increased by 13.9% year over year (four-week moving average), showing steady sales momentum compared with the previous week after an upward trajectory for the prior four weeks. Retail sales remain well above the pre-pandemic level, though people are buying fewer items per dollar spent amid increased price pressures.

Consumer confidence:  The weekly Ipsos-Forbes Advisor U.S. Consumer Confidence Tracker came in at 53.1 for the week ended April 19, down by 2.3 points from two weeks prior and down by 9.3 points from its June 25 high. The rise in inflation to historic highs has dampened consumer sentiment. The Michigan Consumer Sentiment increased to 65.2 in April from its 11-year low of 59.4 in March as optimism about job gains and higher wages helped offset inflation fears. The Conference Board Consumer Confidence reading in April was almost steady at 107.3, from 107.6 in March.

Weekly Economic Index (WEI):  The WEI came in at 4.31% year over year for the week ended April 28, down by 0.16 ppt from the previous week. The decline was mainly due to decreases in retail sales and fuel sales, which more than offset increases in steel production, tax withholding, consumer confidence, railroad traffic, and electricity output and a fall in initial unemployment insurance claims. The index has trended lower since May 2021 but remains elevated compared with the pre-pandemic level.

Rigs count:  The number of active drilling rigs in the U.S. in the week ended April 22 was 549, up by 69 year to date. However, this remains below the pre-pandemic average of 733. Producers appear hesitant to increase production given high oil prices might not last.

Raw steel capacity:  Raw steel capacity utilization for the week ended April 23 came in at 81.7, which is almost 1% above the previous week and the 2019 average. It has been above the 2019 average for two consecutive weeks, after staying below that level for nine consecutive weeks.

Home mortgage applications:  The mortgage purchase applications index dropped by approximately 19 points to 235 for the week ended April 22 amid rising interest rates and high prices. For the week ended April 21, the 30-year mortgage rate was 5.11%, the highest since April 2010. Currently, the applications index is almost 31 points below the pre-pandemic average.

Prices

Lumber futures:  Lumber futures on April 26 traded at $1,035 per 1,000 board feet, up by 18% from the recent low though 29% below a March 3 high and 39% below the May 2021 all-time high. The prices of lumber have been rising mostly on the back of historically low inventory and strong demand created by the homebuilding season. Rising mortgage rates usually mean less demand for new homes, putting downward pressure on lumber prices.

CBR-BLS Metal Price Index:  This index ebbed to $1,372 on April 26 from its record high of $1,431 per point in early April. Nonetheless, it is 122% above the low recorded in April 2020, mainly due to supply shocks caused by the Russia-Ukraine war. According to the World Bank's Commodity Markets Outlook, commodity prices should remain high till the end of 2024.

Freightos Baltic Global Index:  The Freightos Baltic Global Index was at $9,023 per point as of April 26, which is almost 19% below its record high in September 2021 but still high. China's "zero COVID" policy has disrupted availability of goods due to factory closures, and the Russia-Ukraine conflict has restricted trade while demand for freight remains high, keeping ocean rates up.

Gasoline prices:  Oil prices edged down to $4.11 per gallon for the week ended April 25 from an all-time high of $4.32 per gallon for the week ended March 14, but they remain elevated. The U.S. government, along with other major nations, has pledged to put more than 1 million barrels per day on the market for the next six months to ease energy price pressures. Any countermeasures from OPEC could offset this effect.

Forward inflation expectations:  The five-year inflation expectation increased to 2.45% as of April 26, 0.49 ppt above the Feb. 18 low. Meanwhile, the 10-year inflation expectation moved to 2.85% on April 26 from its 19-year high of 3.02% on April 21. Both long-term inflation expectations are high as consumers expect price pressures to persist amid rising input prices driven by the Russia-Ukraine conflict.

Labor market

Initial jobless claims versus Indeed job postings:  Initial jobless claims dipped to 180,000 for the week ended April 23 from the previous week's revised level of 185,000, though this was still near the March 17 53-year low of 166,000. Meanwhile, Indeed job postings as of April 21 were 54% above the Feb. 1, 2020, level. The decline in postings over the past three months could be attributable to some positions (finally) being filled. Job postings remain extremely elevated, reflecting a still-tight jobs market.