On Wednesday, the Federal Reserve released the Minutes from their June 14-15 meeting. As always, this document provides a comprehensive overview of the current state of the u.s. economy. A majority of the discussion centers on coincident indicators, which are depicted below:

The above chart plots industrial production, total payroll employment, trade and manufacturing sales and total income less transfer payments on a base 100 scale dating from June 2009, which, according to the NBER, is when the recession ended. Industrial production (red line) is the only number declining; the other three are rising. The Conference Board provides another perspective on the coincident numbers:

The top table shows the month to month increase in the CEIs while the bottom table shows a rolling 6-month average. Monthly gains have been minimal for the last 7 months while the rolling average shows a consistent rise of .7%-1%. According to the Conference Board's analysis of the data, these readings show that, “economic activity should continue at a moderate pace in the near term, but risks for a slower growth outlook may be rising.” The Fed's analysis is slightly more bullish, as represented by the Atlanta Fed's 2.4% projection and the NY Fed's 2.1% forecast.    

At the meeting, the Fed discussed all major economic sectors, starting with personal consumption spending. Participants observed that consumer spending, which is responsible for 70% of economic growth, was increasing due to rising wages, the “wealth effect” of rising equity and real estate values and solid employment growth. They specifically discussed personal consumption expenditures:

The purple bar at the far right of each month represents the total monthly increase in PCE spending from the preceding month. Overall spending increased in all but 2 months. The Fed believes this trend will continue due to strong consumer balance sheets, positive sentiment and rising incomes.