On Tuesday, August 11, the Labor Department said that productivity jumped at an annual rate of 6.4% in the second quarter of 2009. The increase was the biggest quarterly gain in nearly six years and follows a 0.3% increase in the first quarter.

The Commerce Department said wholesalers reduced their inventories by 1.7% in June, following a revised 1.2% drop in May. It was the 10th straight monthly decline. Sales at the wholesale level rose 0.4% in June and 0.2% in May. It was the first back-to-back increase in a year.

The trade deficit rose 4% to $27 billion in June, from $26 billion in May. Exports rose 2% to $125.8 billion, indicating that demand for American-made goods is picking up.

Retail sales unexpectedly fell 0.1% in July following an upwardly revised 0.8% increase in June. Economists had expected retail sales to rise 0.7% in July.

Initial claims for unemployment benefits rose by 4,000 to 558,000 in the week ending August 8. The figure was higher than the 545,000 that economists had forecast. The number of people continuing to claim jobless benefits in the week ending August 1 fell by 141,000 to 6.2 million.

The Federal Reserve reported that industrial production at the nation’s factories, mines and utilities rose for the first time in nine months. The 0.5% increase in July followed a 0.4% decrease in June. The overall factory-operating rate rose to 68.5% of capacity in July, up from a record low of 68.1% in June.

The Reuters/University of Michigan consumer sentiment index for August fell to 63.2 from 66 in July. Economists had forecast a reading of 69.

Consumer prices were unchanged in July, and for the year are down 2.1%, the biggest decline since 1950.

Upcoming on the economic calendar are reports on the housing market index on August 17, housing starts on August 18 and existing home sales on August 21.

On Monday, July 20, the Conference Board reported that its index of leading economic indicators rose 0.7% in June after a revised 1.3% gain in May. It was the third straight monthly increase and an indication the recession might be nearing an end. Economists had expected an increase of 0.4%.

According to the ICSC-Goldman Sachs index, retail sales rose 0.5% in the week ending July 18. On a year-on-year basis, retailers saw sales decrease by 0.3%.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications for the week ending July 17 rose 2.8% to 528.9. Purchase volume rose 1.3% to 262.1. Refinancing applications increased 4% to 2089.7. The refinance share of mortgage activity increased to 55.5% of total applications from 54.9% the previous week.

Initial claims for unemployment benefits rose by 30,000 to 554,000 in the week ending July 18. The figure was slightly higher than the 550,000 economists had forecast. The number of people continuing to claim jobless benefits in the week ending July 11 decreased by 88,000 to 6.23 million, the lowest level since April.

The National Association of Realtors said existing home sales rose 3.6% in June to a seasonally adjusted annual rate of 4.89 million units from a revised level of 4.72 million units in May. June marks the third consecutive monthly increase in existing home sales for the first time in five years, giving hope the housing crisis is ending.

Meanwhile, the Federal Housing Finance Agency reported U.S. home prices rose 0.9% in May.