New York City is the largest economy city in the United States. There are many service sector companies that have established themselves in New York. These companies operate in the fields of banking, management, insurance, law and accountancy among others. The concentration of these firms in New York has provided employment to many of the residents of the city. This has raised the standards of living of the people in New York. The macroeconomic situation in the city can be measured using different parameters including gross domestic product (GDP), consumer price index (CPI), industrial production/capacity utilization, housing starts, retail sales and stock index among other parameters.
Macroeconomic situation in New York
In the last quarter of 2013, the GDP of New York was $1096 billion; nonfarm payroll employment was 9,046,607. According to the Bureau of Labor Statistics (2014), CPI rose by 0.4% in March after reducing by 0.2% in February. The CPI was 259.971 in March, 29.019 in February and 259.596 in January (Bureau of Labor Statistics , 2014). Industrial production increased by 0.7% in March 2014. According to the Federal Reserve, consumers reduced their spending on general merchandise in early 2014. However, tourism activity especially visits to the Broadway theatres increased by 7% in 2014. Retail sales per capita income is $11,879. Home sales around New York increased by 10%; further, housing prices for rental property in the city increased by between 6 to 9% from the previous year (The Federal Reserve, 2014). According to Yahoo Finance, the S & P 500 index has been increasing over the past month. For example, the index closed at 1822.08 on April 10, 1815.69 on April 11, 1830.61 on April 14 and 1842.98 on April 14 (Yahoo Finance, 2014).
From the information, it can be seen that New York has a positive general macroeconomic situation. This is based on the increased production of the industries. Through this, there have been employment opportunities that have been created that have helped to drive the growth of the city. It is expected that the economic environment will improve further due to the reduction in inflation to almost 2.4% (Federal Reserve Bank of New York, 2014). Personal income for most citizens is also expected to increase going into the remaining quarters of the year. This is based on the fact that the government has put up measures to increase more employment opportunities. However, there are some economic issues that need urgent concern. One of these issues is the average number of homelessness population in the city. This should be addressed by the authorities. The other issue is the uneven economic growth that has been experienced over the years in the city. This has increased the gap between the rich and the poor in New York.
The FOMC should slightly lower the interest rates in the short term. This will encourage many people to access mortgages and credit with which they can use to purchase homes. This will help in reducing the number of homelessness in New York. Reduction in interest rates will also allow businesses to acquire credit that they can use to expand the businesses (Bergsten, 2013). This will help in creating more employment opportunities and improve the economic outlook.
Bergsten, C. F. (2013). The United States and the World Economy: Foreign Economic Policy for
the Next Decade. New York: Peterson Institute.
Bureau of Labor Statistics . (2014). Bureau of Labor Statistics . Retrieved April 16, 2014, from
Federal Reserve Bank of New York. (2014). Retrieved April 16, 2014, from Federal Reserve
Bank of New York: http://www.newyorkfed.org/index.html
The Federal Reserve. (2014, March 5). The Federal Reserve. Retrieved April 16, 2014, from
Yahoo Finance. (2014). Retrieved April 16, 2014, from Yahoo Finance: