West Coast ports are closing out the first half of the year with strong trade volumes, boosted by an early peak season, solid consumer spending, and threats of a labor strike at East and Gulf Coast ports.

The Port of Los Angeles handled 4.7 million 20-foot container equivalent units in the first half of 2024, 14.4% more than the same period last year, according to data out Wednesday. Imports ticked down 1.5% in June compared to the same month last year, while exports climbed more than 13% and empty container volumes fell 4.6%.

Declining inflation, higher wages and a robust job market are fueling consumer spending that has resulted in steady cargo volumes, Port of LA Executive Director Gene Seroka said at a press conference.

“I think we’ll see this pattern continue as we move into the third quarter,” Seroka said.

Worries about more US tariffs on Chinese goods, and the threat of labor turmoil at East and Gulf Coast ports, are helping to bring on an earlier-than-usual peak season.

Neighboring Port of Long Beach posted its strongest total volume for the month of June on record, and the highest reading for inbound containers since mid-2022, data released Tuesday showed. Total container volumes were up 15% in the first half of 2024 compared to last year.

Separately, the Port of Oakland reported 84,040 TEUs of imports in June, a 26.8% increase compared to the same month last year, marking the highest monthly total since August 2022. Loaded exports at the San Francisco Bay trade hub continued to stabilize at around 65,000 to 70,000 TEUs each month after falling during the pandemic.

Fed risks ‘golden path’ if it doesn’t cut soon

Federal Reserve Bank of Chicago President Austan Goolsbee suggested the central bank may need to lower borrowing costs soon in order to avoid a sharper deterioration in the labor market, which has cooled in recent months.

While the Fed’s inflation fight is ongoing, multiple months of improving data have reassured him that officials are back on track to bring inflation down to their 2% goal, Goolsbee said. But he said the labor market is “definitely an area of concern,” noting that keeping interest rates elevated while price pressures ease means monetary policy has “tightened substantially.”

Asked whether officials risk the “golden path,” as Goolsbee calls it — the prospect of winning their inflation battle without a significant rise in unemployment — the Chicago Fed chief answered immediately, “Yes.”

“Just look at the real fed funds rate — the interest rate minus inflation. That’s as high as it’s been in decades,” Goolsbee, who will vote at the Fed’s meeting later this month as an alternate member of the Federal Open Market Committee, said in a Yahoo Finance broadcast interview.

“And when do you want to be that restrictive? As I say, you want to be restrictive if you’re afraid of an overheating economy,” he said. “The economy’s not overheating.”

He stopped short of saying when officials ought to begin lowering rates.

Tesla’s sales in California plunge as competition mounts

Tesla’s new-car registrations fell 24% in California in the second quarter, the third time in a row the carmaker’s sales have fallen in the Golden State, according to a report released Thursday by the California New Car Dealers Association.

While the Model Y remains the state’s top-selling car, the Elon Musk-led company has seen its market share falter throughout the year. Tesla accounted for 53.4% of California’s battery-electric car market in the first half, down from 64.6% a year ago, the CNCDA report said. Overall Tesla sales in California are down 17% so far this year.

“Tesla’s allure seems to be wearing off, signaling potential trouble for the direct-to-consumer manufacturer,” the trade group’s analysts said.

New EV models have posed a competitive threat to Tesla, which has a relatively older lineup of cars. Ford Motor Co., Hyundai Motor Co. and Rivian Automotive Inc. are all among companies that have grabbed a bigger slice of California’s electric-vehicle market. Overall, battery-powered cars account for about a fifth of auto sales in the state, while California makes up a third of US EV sales.

Tesla is the second-bestselling car brand in California, but CNCDA believes it may have peaked. Earlier this month, the company reported global second-quarter sales that were lower than a year ago, but better than analysts expected.

Compiled from Bloomberg reports.