WASHINGTON » No, the economy isn’t roaring ahead. And no, companies aren’t making lots of job offers. But a fresh batch of economic data yesterday at least eased summertime fears that the economy might be on the brink of another recession.
Far fewer people applied for unemployment aid last week, suggesting layoffs are easing. And the nation’s trade deficit narrowed in July, thanks to a bigger appetite overseas for American exports.
Other recent data support the notion that the economy, while growing only fitfully, is at least not in danger of stalling:
» Hiring by private companies over the summer turned out to be better than expected. The pace still isn’t enough to bring down high unemployment, but it indicates economic expansion.
» Stock prices have staged a September rally and put the Dow Jones industrial average back about even for 2010. Stocks posted their sixth gain in the past seven days yesterday, a sign of rising investor confidence.
» Drivers are benefiting from lower gas prices, which are expected to keep falling because the summer driving season ended with plentiful supplies in storage.
» Shoppers are enjoying discounted prices in stores and have helped lift retail sales. Analysts think stores will continue to discount to get shoppers to spend this fall and for the holiday season.
Analysts say they think the economy will continue to plod along in the coming months. The economy will grow, though too weakly to create many jobs for the nearly 15 million unemployed Americans.
"At the moment, we can rule out a double-dip for the economy," Chris Rupkey, chief economist at Bank of Tokyo-Mitsubishi, said yesterday. "Things look better than they have in several weeks, and there is no danger of a new downturn in activity."
The last time the nation suffered something like a double-dip recession was in 1980 and 1981. That period met a generally accepted definition of a double-dip: The economy shrinks, starts growing again, then shrinks again for at least six months.
That second recession, from July 1981 to November 1982, was a severe one. But it ushered in a period of explosive growth starting in 1983.
This time, few economists foresee a similar bust-boom-bust. Rather, they expect a continuation of the steady but low-grade rebound from the recession, which began in December 2007 and is thought to have ended last year.
Yesterday’s data added to confidence that the economy will keep growing slowly and eventually lead to more job creation.
Still, some economists warn that despite the latest encouraging data, the threat of a double-dip hasn’t been extinguished. After all, it was just weeks ago, after a flurry of gloomy reports, that some had raised concerns about a possible new recession.