Consumer credit increased at an annual rate of 8% to $2.57 trillion in May. The U.S. trade deficit narrowed 3.8% to $48.7 billion in May. Some FOMC members believe more monetary stimulus will be needed. The U.S. Treasury recorded a deficit of $59.7 billion in June. The topline PPI rose 0.1% while the core PPI was up 0.2%. Initial jobless claims declined 25,000 to a level of 350,000 for the week ended 7/7.

• Consumer credit increased $17.1 billion (annual rate of 8%) to $2.57 trillion in May. Revolving credit (i.e., credit cards) rose at an annual pace of 11.2% while non-revolving credit (i.e., auto loans) was up 6.5%.

• The U.S. trade deficit unexpectedly narrowed $1.9 billion (3.8%) to $48.7 billion in May. Exports rose 0.2% while imports fell 0.7%. Exports to both Europe and China were up, despite Europe’s troubles and China’s cooling growth.

• The minutes of the June 19-20 FOMC meeting revealed that some members feel more monetary stimulus may be needed. Some members expressed the risk that further easing might pose, noting that excessive purchases of Treasuries could “at some point, lead to deterioration in the functioning of the Treasury securities market that could undermine the intended effects of the policy.”

• The U.S. Treasury reported a deficit of $59.7 billion in June.

• The topline producer price index edged up 0.1% in June. The core PPI rose 0.2%.

• Initial jobless claims declined 25,000 to a level of 350,000 for the week ended July 7th. This marks the lowest level of initial claims in four years, although the July 4th holiday could have contributed to the lower-than-expected level.