Four of five key economic indicators dipped in our region. The most volatile component may be the housing market.
The Augusta Leading Economic Index (LEI) fell 0.7 percent in July. It remains 0.9 percent higher than July 2025.
Residential building permits in the Augusta metro area fell 25 percent. This component is quite volatile; in June permits were at the highest level since March 2025. Initial claims for unemployment insurance were up 50 percent, not unusual in the summer months with school leavers entering the labor market.
Job openings in the South Census Region fell to the lowest level since September 2024, although there does not seem to be any long-term downward trend (see chart below).
Real deposits in local banks, a measure of future spending, declined amid continued elevated inflation. Last Friday the Bureau of Labor Statistics released the latest inflation data for August, and it came in hot. The monthly change was 0.4% compared to an expected 0.2%, for an annualized increase of 3.4%, raising expectations that the Federal Reserve will raise interest rates at its meeting this week.
The only component of the LEI that showed positive returns in July was the Dow Jones Industrial Average (DJIA). The DJIA is highly correlated with stock prices of companies that have a presence in Augusta and represents the discounted future profits of firms. Rising stock prices indicate rising expected future profits. Despite some strong economic headwinds in terms of inflation and potential interest rate rises, investors remain optimistic about the future.
