The Economic Situation, Third Quarter, 1926

October 4, 1926

Report Outline
Special Focus

Activity in industry and trade, notwithstanding the seasonal declines that usually occur in mid-summer, was maintained at a high level in the third quarter of the year, and the total volume of business was larger than in the corresponding period of any other recent year.

Production in basic industries, after declining in April and May from the high level reached in March, increased in the following two months and continued in large volume in August and September. Distribution of this large volume of production through domestic channels of trade remained constantly at a higher level during the summer and early weeks of September than in any previous summer. Exports continued to increase, relative to imports, and the large balance of $125,000,000 of merchandise imports at the end of March was reduced to $20,000,000 at the end of August. Harvesting and marketing of the year's crops began late in the summer and in August and September more definite information indicated that the total volume of crop production this year will be near that of other recent years.

Commodity prices, after declining rapidly in the first quarter of the year and remaining fairly steady in the second quarter, turned downward again early in the summer and in August and September reached a level lower than at any time since the summer of 1924. Price declines since the beginning of July have been particularly pronounced for agricultural commodities while prices of non-agricultural commodities have remained fairly stable.

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Economic Crises