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Category: Research - Topic: Economics


Industrial Production edged down 0.1%
Capacity Utilization decreased 0.3% to 78.8%

Posted: September 15, 2014 at 09:15 AM (Monday)

The index of industrial production edged down 0.1 percent in August, and the index for manufacturing output decreased 0.4 percent; the declines were the first for each since January. The gains in July for both indexes were revised down. The declines in total industrial production and in manufacturing output in August reflected a decrease of 7.6 percent in the production of motor vehicles and parts, which had jumped more than 9 percent in July. Excluding motor vehicles and parts, factory output rose 0.1 percent in both July and August. The production at mines moved up 0.5 percent in August, and the output of utilities rose 1.0 percent. At 104.1 percent of its 2007 average, total industrial production in August was 4.1 percent above its year-earlier level. Capacity utilization for total industry decreased 0.3 percentage point in August to 78.8 percent, a rate 1.0 percentage point above its level of a year earlier and 1.3 percentage points below its long-run (1972–2013) average.


Empire State Manufacturing Survey Conditions expanded at a robust pace
Posted: September 15, 2014 at 08:30 AM (Monday)

The September 2014 Empire State Manufacturing Survey indicates that business activity expanded at a robust pace for New York manufacturers. The headline general business conditions index rose thirteen points to 27.5, a multiyear high. The new orders index moved up three points to 16.9, and the shipments index advanced two points to 27.1. The unfilled orders index fell three points to -10.9. The prices paid index declined three points to 23.9, indicating a slower pace of input price increases, while the prices received index climbed nine points to 17.4, suggesting a pickup in the pace of selling price increases. Employment indexes showed a slight increase in employment levels and hours worked. Indexes for the six-month outlook conveyed a high degree of optimism about future business conditions.

Business Activity Expands Robustly
Growth in business activity for New York manufacturers was solid, according to the September 2014 survey. The general business conditions index climbed thirteen points to 27.5, its highest level since late 2009. Forty-six percent of respondents reported that conditions had improved over the month, while 18 percent reported that conditions had worsened. The new orders index rose three points to 16.9, indicating a sturdy increase in orders, and the shipments index advanced two points to 27.1, pointing to a substantial increase in shipments. The unfilled orders index dropped three points to -10.9, suggesting that fewer orders remained unfilled over the month. The delivery time index was little changed at -5.4, and the inventories index, up seven points to -7.6, showed a decline in inventory levels for a third consecutive month.

Selling Prices Rise More Sharply
The prices paid index was slightly lower this month, falling three points to 23.9—a sign that input price increases were somewhat less widespread. The prices received index, however, jumped nine points to 17.4, indicating a pickup in the pace of selling price increases. Employment indexes pointed to a small increase in employment levels and hours worked: the index for number of employees fell ten points to 3.3, and the average workweek index dropped five points to 3.3.

Outlook Remains Bright
Optimism about future business conditions remained high. The index for future general business conditions was unchanged from last month at 46.7. The future new orders index fell five points to 45.6, and the future shipments index declined seven points to 47.5. Though both of these indexes were somewhat below their August levels, they remained high by historical standards. The index for expected number of employees dipped to 14.1, and the future average workweek index was 5.4. The capital expenditures index fell five points to 13.0, and the technology spending index edged down three points to 9.8.


Business Inventories up 0.4% in July
Posted: September 12, 2014 at 10:00 AM (Friday)

The U.S. Census Bureau announced today that the combined value of distributive trade sales and manufacturers’ shipments for July, adjusted for seasonal and trading-day differences but not for price changes, was estimated at $1,360.3 billion, up 0.8 percent (±0.2%) from June 2014 and were up 5.3 percent (±0.6%) from July 2013.

Manufacturers’ and trade inventories, adjusted for seasonal variations but not for price changes, were estimated at an end-of-month level of $1,750.1 billion, up 0.4 percent (±0.1%) from June 2014 and up 5.9 percent (±0.4%) from July 2013.

The total business inventories/sales ratio based on seasonally adjusted data at the end of July was 1.29. The July 2013 ratio was 1.28.


U.S. Import Price Index declined 0.9% in August
Posted: September 12, 2014 at 08:30 AM (Friday)

Prices for U.S. imports decreased 0.9 percent in August following a 0.3-percent decline in July, the U.S. Bureau of Labor Statistics reported today. Both the August and July drops in overall import prices were driven by lower fuel prices. U.S. export prices declined 0.5 percent in August, after ticking up 0.1 percent the previous month.


U.S. Retail Sales for August increase 0.6%, Ex-Auto up 0.3%
Posted: September 12, 2014 at 08:30 AM (Friday)

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for August, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $444.4 billion, an increase of 0.6 percent (±0.5%) from the previous month, and 5.0 percent (±0.9%) above August 2013. Total sales for the June through August 2014 period were up 4.5 percent (±0.7%) from the same period a year ago. The June to July 2014 percent change was revised from virtually unchanged (±0.5%)* to 0.3 percent (±0.2%).

Retail trade sales were up 0.6 percent (±0.5%) from July 2014, and 4.8 percent (±0.7%) above last year. Auto and other motor vehicle dealers were up 9.5 percent (±3.0%) from August 2013 and health and personal care stores were up 8.1 percent (±1.9%) from last year.


DJ-BTMU U.S. Business Barometer unch%
Posted: September 11, 2014 at 10:00 AM (Thursday)

For the week ending August 30 2014, the DJ-BTMU U.S. Business Barometer remained at the same level, 98.6, from the prior week as minor gains in most indexes were entirely cancelled out by sharp drops in others. On one side, electric output and lumber production rose by 1.7 and 1.8 percent, respectively, in line with other minor gains in truck and steel production. However, on the other side, auto production plummeted by 8.4 percent this week as well as MBA’s purchase index and coal production, which declined by around 1.0 percent.

On a year-over-year basis, the barometer showed a gain of 1.1 percent, which compares to an average -3.3 percent decline over the Great Recession (ended in June 2009 according to the NBER). After flat lining in 2006, and declining from 2007 through 2009, the barometer bounced back in 2010 to rise by 3.4 percent, which was the strongest increase since 1994 (+4.0 percent), but not so impressive when compared to an -8.0 percent drop in 2009. The rate of increase for the 2013 slowed to 0.7 percent following 1.5 percent in 2012.

The smoothed version of the barometer, which attempts to account for weekly volatility, surged 0.1 percent to 98.6. Its year-over-year growth rate remained at 1.1 percent.


Weekly Initial Unemployment Claims Increase 11,000 to 315,000
Posted: September 11, 2014 at 08:30 AM (Thursday)

In the week ending September 6, the ad vance figure for seasonally adjusted initial claims was 315,000, an increase of 11,000 from the previous week's revised level. The previous week's level was revised up by 2,000 from 302,000 to 304,000. The 4-week moving average was 304,000, an increase of 750 from the previous week's revised average. The previous week's average was revised up by 500 from 302,750 to 303,250. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.9 percent for the week ending August 30, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending August 30 was 2,487,000, an increase of 9,000 from the previous week's revised level. The previous week's level was revised up 14,000 from 2,464,000 to 2,478,000. The 4-week moving average was 2,498,750, a decrease of 15,500 from the previous week's revised average. This is the lowest level for this average since June 30, 2007 when it was 2,489,500. The previous week's average was revised up by 3,500 from 2,510,750 to 2,514,250.


Wholesale Inventories up 0.1% in July
Posted: September 10, 2014 at 10:00 AM (Wednesday)

The U.S. Census Bureau announced today that July 2014 sales of merchant wholesalers, except manufacturers’ sales branches and offices, after adjustment for seasonal variations and trading-day differences but not for price changes, were $458.6 billion, up 0.7 percent (+/-0.5) from the revised June level and were up 7.5 percent (+/-1.8%) from the July 2013 level. The June preliminary estimate was revised upward $0.7 billion or 0.2 percent. July sales of durable goods were up 0.4 percent (+/-0.9%)* from last month and were up 8.0 percent (+/-1.4%) from a year ago. Sales of metals and minerals, except petroleum were up 4.5 percent from last month. Sales of nondurable goods were up 1.0 percent (+/-0.7%) from June and were up 7.2 percent (+/-2.8%) from last July. Sales of grocery and related products were up 2.9 percent from last month and sales of petroleum and petroleum products were up 2.6 percent.

Total inventories of merchant wholesalers, except manufacturers’ sales branches and offices, after adjustment for seasonal variations but not for price changes, were $533.8 billion at the end of July, up 0.1 percent (+/-0.4%)* from the revised June level and were up 7.9 percent (+/-0.7%) from the July 2013 level. The June preliminary estimate was revised downward $0.5 billion or 0.1 percent. July inventories of durable goods were up 0.3 percent (+/-0.2%) from last month and were up 8.4 percent (+/-1.2%) from a year ago. Inventories of hardware and plumbing and heating equipment and supplies were up 1.8 percent from last month, while inventories of computer and computer peripheral equipment and software were down 4.0 percent. Inventories of nondurable goods were virtually unchanged (+/-0.7%)* from June, but were up 7.0 percent (+/-1.2%) from last July. Inventories of farm product raw materials were down 8.2 percent from last month, while inventories of drugs and druggists' sundries were up 3.2 percent.

The July inventories/sales ratio for merchant wholesalers, except manufacturers’ sales branches and offices, based on seasonally adjusted data, was 1.16. The July 2013 ratio was 1.16.


Purchase Apps down, Refi's down in Latest MBA Weekly Survey
Posted: September 10, 2014 at 07:00 AM (Wednesday)

Mortgage applications decreased 7.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 5, 2014. This week’s results included an adjustment for the Labor Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, decreased 7.2 percent on a seasonally adjusted basis from one week earlier, to the lowest level since December 2000. On an unadjusted basis, the Index decreased 17 percent compared with the previous week. The Refinance Index decreased 11 percent from the previous week, to the lowest level since November 2008. The seasonally adjusted Purchase Index decreased 3 percent from one week earlier, to the lowest level since February 2014. The unadjusted Purchase Index decreased 14 percent compared with the previous week and was 12 percent lower than the same week one year ago.

The refinance share of mortgage activity decreased to 55 percent of total applications from 57 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.5 percent of total applications from 7.8 percent the previous week.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.27 percent, the first increase in four weeks, from 4.25 percent, with points increasing to 0.25 from 0.24 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) decreased to 4.15 percent from 4.22 percent, with points increasing to 0.23 from 0.19 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.97 percent from 3.99 percent, with points increasing to 0.08 from 0.03 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.44 percent from 3.48 percent, with points decreasing to 0.28 from 0.30 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to 3.12 percent from 3.19 percent, with points remaining unchanged at 0.45 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.


Job Openings were 4.7 million in July
Posted: September 9, 2014 at 10:00 AM (Tuesday)

There were 4.7 million job openings on the last business day of July, little changed from June, the U.S. Bureau of Labor Statistics reported today. The hires rate (3.5 percent) and the separations rate (3.3 percent) were unchanged in July. Within separations, the quits rate (1.8 percent) and the layoffs and discharges rate (1.2 percent) were unchanged. This release includes estimates of the number and rate of job openings, hires, and separations for the nonfarm sector by industry and by four geographic regions.

There were 4.7 million job openings on the last business day of July and the rate was 3.3 percent. The 1-month change in the number of openings was not significant for total private, government, all industries, and in all four regions. (See table 1.) Although the number of total nonfarm job openings was little changed in July, there were 799,000 more job openings in July than in January 2014. The largest increases since January were in retail trade, professional and business services, and health care and social assistance.

The number of job openings (not seasonally adjusted) increased over the 12 months ending in July 2014 for total nonfarm, total private, and government. The job openings level increased in several of the industries and in all four regions.


ICSC Chain Store Sales increased by 0.7% in Sept 6 Wk
Posted: September 9, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 4.0% for the week ending September 6 - relative to the prior year. On a week-over-week basis, sales popped up by 0.7%.

"According to the ICSC-GS consumer tracking survey business over the past week was healthy overall and strong for department, apparel, discount, electronics and furniture stores," said Michael Niemira, ICSC research consultant. "September tends to have the third highest volume in sales during the year, capturing the last of the back-to-school shopping and fall merchandise demand. I expect sales for the month to continue to show a healthy trend - increasing by 4% to 5%," he added.


NFIB Small Business Optimism Index rose 0.4 points to 96.1
Posted: September 9, 2014 at 07:30 AM (Tuesday)

August’s Optimism Index rose 0.4 points to 96.1 making it the second highest reading since October 2007. Expectations are still glum, although improving grudgingly. More owners still think business conditions will be worse in six months than think they will be better. Few see the current period as a good time to expand. The outlook for improvements in real sales volumes faded. Interest in borrowing continues to remain at record low levels; owners are satisfied with inventories and aren’t planning a lot of investment. There is still no evidence that we are about to ramp up spending and hiring to “3 percent” GDP growth levels.

The good news, no recession signal. The bad news, no expansion signal. The NFIB Optimism Index was steady at the high end of its fairly narrow tunnel of moderately poor performances. A persistent up-trend in reported increases in average selling prices snapped, probably in response to unexpectedly weak consumer spending. Capital spending showed a bit more life, along with a hike in plans to continue it. But employment indicators were flat. Job openings increased, anticipating a lower unemployment rate but not more jobs as job creation plans faltered. There just wasn’t a lot of good GDP news in the numbers, just a “more of the same” picture. Spending and hiring seem to be driven mostly by population growth and the need to replace depreciated assets. Weak consumer spending is not helping. Strong exports do not help most small businesses. Manufacturers and some transportation companies benefit but not most others.

The litany of issues that need to be addressed have been laid out by observers for years now, but there is little progress in Washington on any of them. And new ones are being added along the way. Consumer sentiment (Reuters/University of Michigan) is as low in August as it was a year ago and the readings this year are no better than the weak December, 2013 reading. Only 11 percent of consumers think government is doing a “good” job, 48 percent say “poor”. Incomes are rising only for the top 10 percent and they don’t spend enough of that income to compensate for the weak spending of the 90 percent.

Manufacturing is doing well, but there are not many jobs there. However, the small business and consumer segments are not strong and that means economic growth cannot fundamentally be strong. Government spending will not be a major source of stimulus. So, the plodding on continues.


Consumer Credit Increased at an annual rate of .75%
Posted: September 8, 2014 at 03:00 PM (Monday)

In July, consumer credit increased at a seasonally adjusted annual rate of 9-3/4 percent. Revolving credit increased at an annual rate of 7-1/2 percent, while nonrevolving credit increased at an annual rate of 10-1/2 percent.


Employment Trends Index increased in August to 121.29
Posted: September 8, 2014 at 10:00 AM (Monday)

The Conference Board Employment Trends Index™ (ETI) increased in August. The index now stands at 121.29, up from 120.62 (an upward revision) in July. This represents a 6.4 percent gain in the ETI compared to a year ago.

The strong increase in the Employment Trends Index in recent months signals robust job growth through the fall. The disappointing employment numbers for August seem to be a one-month deviation from a stronger trend.

August’s increase in the ETI was driven by positive contributions from seven of its eight components. In order from the largest positive contributor to the smallest, these were: Percentage of Firms with Positions Not Able to Fill Right Now, Industrial Production, Ratio of Involuntarily Part-time to All Part-time Workers, Real Manufacturing and Trade Sales, Number of Temporary Employees, Job Openings, and Percentage of Respondents Who Say They Find “Jobs Hard to Get.”


August Employment increased by 142,000
Unemployment Rate dropped to 6.1%

Posted: September 5, 2014 at 08:30 AM (Friday)

Total nonfarm payroll employment increased by 142,000 in August, and the unemployment rate was little changed at 6.1 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in professional and business services and in health care.

In August, both the unemployment rate (6.1 percent) and the number of unemployed persons (9.6 million) changed little. Over the year, the unemployment rate and the number of unemployed persons were down by 1.1 percentage points and 1.7 million, respectively.

Among the major worker groups, the unemployment rates in August showed little or no change for adult men (5.7 percent), adult women (5.7 percent), teenagers (19.6 percent), whites (5.3 percent), blacks (11.4 percent), and Hispanics (7.5 percent). The jobless rate for Asians was 4.5 percent (not seasonally adjusted), little changed from a year earlier.

The number of long-term unemployed (those jobless for 27 weeks or more) declined by 192,000 to 3.0 million in August. These individuals accounted for 31.2 percent of the unemployed. Over the past 12 months, the number of long-term unemployed has declined by 1.3 million.

The civilian labor force participation rate, at 62.8 percent, changed little in August and has been essentially unchanged since April. In August, the employment-population ratio was 59.0 percent for the third consecutive month but is up by 0.4 percentage point from a year earlier.

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was little changed in August at 7.3 million. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.

In August, 2.1 million persons were marginally attached to the labor force, down by 201,000 from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

Among the marginally attached, there were 775,000 discouraged workers in August, little changed from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.4 million persons marginally attached to the labor force in August had not searched for work for reasons such as school attendance or family responsibilities.

Total nonfarm payroll employment increased by 142,000 in August, compared with an average monthly gain of 212,000 over the prior 12 months. In August, job growth occurred in professional and business services and in health care.

In August, the average workweek for all employees on private nonfarm payrolls was 34.5 hours for the sixth consecutive month. The manufacturing workweek edged up by 0.1 hour to 41.0 hours, and overtime was unchanged at 3.4 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls was 33.7 hours for the sixth consecutive month.

Average hourly earnings for all employees on private nonfarm payrolls rose by 6 cents in August to $24.53. Over the year, average hourly earnings have risen by 2.1 percent. In August, average hourly earnings of private-sector production and nonsupervisory employees rose by 6 cents to $20.68.

The change in total nonfarm payroll employment for June was revised from +298,000 to +267,000, and the change for July was revised from +209,000 to +212,000. With these revisions, employment gains in June and July combined were 28,000 less than previously reported.


ISM Non-Manufacturing Index grew at 59.6%
Posted: September 4, 2014 at 10:00 AM (Thursday)

Economic activity in the non-manufacturing sector grew in August for the 55th consecutive month, say the nation's purchasing and supply executives in the latest Non-Manufacturing ISM® Report On Business®.

The NMI® registered 59.6 percent in August, 0.9 percentage point higher than the July reading of 58.7 percent. This represents continued growth in the Non-Manufacturing sector. The August reading of 59.6 percent is the highest for the composite index since its inception in January 2008. The Non-Manufacturing Business Activity Index increased to 65 percent, which is 2.6 percentage points higher than the July reading of 62.4 percent, reflecting growth for the 61st consecutive month at a faster rate. This is the highest reading for the index since December of 2004 when the index also registered 65 percent. The New Orders Index registered 63.8 percent, 1.1 percentage points lower than the reading of 64.9 percent registered in July. The Employment Index increased 1.1 percentage points to 57.1 percent from the July reading of 56 percent and indicates growth for the sixth consecutive month. The Prices Index decreased 3.2 percentage points from the July reading of 60.9 percent to 57.7 percent, indicating prices increased at a slower rate in August when compared to July. According to the NMI®, 15 non-manufacturing industries reported growth in August. Respondents' comments vary by business and industry. The majority of the comments reflect continued optimism in regards to business conditions. Some respondents indicate that there may be some tapering off in the recent strong rate of growth in the non-manufacturing sector.

INDUSTRY PERFORMANCE
The 15 non-manufacturing industries reporting growth in August — listed in order — are: Construction; Retail Trade; Management of Companies & Support Services; Educational Services; Transportation & Warehousing; Wholesale Trade; Information; Public Administration; Other Services; Professional, Scientific & Technical Services; Health Care & Social Assistance; Agriculture, Forestry, Fishing & Hunting; Finance & Insurance; Accommodation & Food Services; and Real Estate, Rental & Leasing. The two industries reporting contraction in August are: Arts, Entertainment & Recreation; and Mining.


DJ-BTMU U.S. Business Barometer picked up by 0.2%
Posted: September 4, 2014 at 10:00 AM (Thursday)

For the week ending August 23 2014, the DJ-BTMU U.S. Business Barometer picked up by 0.2 percent to 98.6 as most indexes reversed their weakening trend. Chain store sales surged 0.6 percent, after declining for two consecutive weeks. MBA’s purchase index also bounced back by a solid 2.6 percent following three weeks of negative performance. As to the production side, electric output and coal production rose by 4.8 and 2.1 percent, respectively, although it was partially offset by weak performance in lumber production.

On a year-over-year basis, the barometer showed a gain of 1.2 percent, which compares to an average -3.3 percent decline over the Great Recession (ended in June 2009 according to the NBER). After flat lining in 2006, and declining from 2007 through 2009, the barometer bounced back in 2010 to rise by 3.4 percent, which was the strongest increase since 1994 (+4.0 percent), but not so impressive when compared to an -8.0 percent drop in 2009. The rate of increase for the 2013 slowed to 0.7 percent following 1.5 percent in 2012.

The smoothed version of the barometer, which attempts to account for weekly volatility, remained at 98.5 for three successive weeks. Its year-over-year growth rate was 1.1 percent.


Weekly Initial Unemployment Claims Increase 4,000 to 302,000
Posted: September 4, 2014 at 08:30 AM (Thursday)

In the week ending August 30, the advance figure for seasonally adjusted initial claims was 302,000, an increase of 4,000 from the previous week's unrevised level of 298,000. The 4-week moving average was 302,750, an increase of 3,000 from the previous week's unrevised average of 299,750. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.9 percent for the week ending August 23, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending August 23 was 2,464,000, a decrease of 64,000 from the previous week's revised level. This is the lowest level for insured unemployment since June 16, 2007 when it was 2,453,000. The previous week's level was revised up 1,000 from 2,527,000 to 2,528,000. The 4-week moving average was 2,510,750, a decrease of 13,750 from the previous week's revised average. This is the lowest level for this average since July 7, 2007 when it was 2,509,250. The previous week 's average was revised up by 250 from 2,524,250 to 2,524,500.


2Q2014 Productivity Growth Increased 2.3%
Posted: September 4, 2014 at 08:30 AM (Thursday)

Nonfarm business sector labor productivity increased at a 2.3 percent annual
rate during the second quarter of 2014, the U.S. Bureau of Labor Statistics
reported today, as hours increased 2.6 percent and output increased 5.0
percent. (All quarterly percent changes in this release are seasonally
adjusted annual rates.) From the second quarter of 2013 to the second quarter
of 2014, productivity increased 1.1 percent as output and hours worked rose
3.2 percent and 2.0 percent, respectively.

Labor productivity, or output per hour, is calculated by dividing an index of
real output by an index of hours worked of all persons, including employees,
proprietors, and unpaid family workers. The measures released today were
based on more recent source data than were available for the preliminary
report.

Unit labor costs in nonfarm businesses edged down 0.1 percent in the second
quarter of 2014, and increased 1.7 percent over the last four quarters.

Manufacturing sector productivity increased 3.3 percent in the second quarter
of 2014, as output increased 6.9 percent and hours worked increased 3.5
percent. The increase in output was the largest since the second quarter of
2010 (11.6 percent). Productivity increased 3.4 percent in the durable goods
sector and increased 4.7 percent in the nondurable goods sector. Over the
last 4 quarters, manufacturing productivity increased 2.1 percent, as output
increased 3.7 percent and hours increased 1.6 percent. Unit labor costs in
manufacturing decreased 1.6 percent in the second quarter of 2014 and
increased 0.8 percent from the same quarter a year ago.

Preliminary second-quarter 2014 measures of productivity and costs were
announced for the nonfinancial corporate sector. Productivity increased 3.1
percent in the second quarter of 2014 as output and hours rose 7.8 percent
and 4.5 percent, respectively. Unit labor costs fell 1.2 percent, as the
1.8 percent gain in hourly compensation was less than the 3.1 percent gain
in productivity.


Goods and Services Deficit Decreased in July 2014
Posted: September 4, 2014 at 08:30 AM (Thursday)

The Nation’s international trade deficit in goods and services decreased to $40.5 billion in July from $40.8 billion in June (revised), as exports and imports increased.

The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that total July exports of $198.0 billion and imports of $238.6 billion resulted in a goods and services deficit of $40.5 billion, down from $40.8 billion in June, revised. July exports were $1.8 billion more than June exports of $196.2 billion. July imports were $1.6 billion more than June imports of $237.0 billion.

In July, the goods deficit decreased $0.2 billion from June to $60.2 billion, and the services surplus was virtually unchanged at $19.6 billion. Exports of goods increased $1.8 billion to $138.6 billion, and imports of goods increased $1.5 billion to $198.8 billion. Exports of services increased $0.1 billion to $59.4 billion, and imports of services were virtually unchanged at $39.8 billion.

The goods and services deficit increased $1.1 billion from July 2013 to July 2014. Exports were up $8.1 billion, or 4.3 percent, and imports were up $9.2 billion, or 4.0 percent.


ADP National Employment Report increased by 204,000 in August
Posted: September 4, 2014 at 08:15 AM (Thursday)

Private sector employment increased by 204,000 jobs from July to August according to the August ADP National Employment Report®. Broadly distributed to the public each month, free of charge, the ADP National Employment Report is produced by ADP®, a leading global provider of Human Capital Management (HCM) solutions, in collaboration with Moody’s Analytics. The report, which is derived from ADP’s actual payroll data, measures the change in total nonfarm private employment each month on a seasonally-adjusted basis.

Goods-producing employment rose by 41,000 jobs in August, up from 23,000 jobs gained in July. The construction industry added 15,000 jobs over the month, slightly above last month’s gain. Meanwhile, manufacturing added 23,000 jobs in August, the highest total in that sector since December 2012.

Service-providing employment rose by 164,000 jobs in August, down from 190,000 in July. The ADP National Employment Report indicates that professional/ business services contributed 51,000 jobs in August, down from 60,000 in July. Expansion in trade/transportation/utilities grew by 28,000, down from July’s 43,000. The 5,000 new jobs added in financial activities was down almost half from last month’s number.

August marks the fifth straight month of employment gains above 200,000, continuing an encouraging trend for the U.S. labor market.

Steady as she goes in the job market. Businesses continue to hire at a solid pace. Job gains are broad based across industries and company sizes. At the current pace of job growth the economy will return to full employment by the end of 2016.

Payrolls for businesses with 49 or fewer employees increased by 78,000 jobs in August. That’s down from 89,000 in July. Job growth was also down over the month for medium-sized firms. Employment among medium-sized companies with 50-499 employees rose by 75,000, down from 88,000 in July. Employment at large companies – those with 500 or more employees – increased by 52,000, up from 35,000 the previous month. Companies with 500-999 employees added 5,000, down from July’s 13,000.


Challenger Layoffs declined 15% in August
Posted: September 4, 2014 at 07:30 AM (Thursday)

Planned job cuts announced by US-based employers totaled 40,010 in August, a 15 percent decline from the 46,887 planned layoffs reported in July, according to the report released Thursday by global outplacement consultancy Challenger, Gray & Christmas, Inc.

The August total was 21 percent lower than the same month a year ago, when 50,462 job cuts were announced. This marks just the fourth time this year that the monthly total was lower than the comparable period a year ago.

Despite this trend, job cuts for the year are down slightly from 2013. Through August 31, planned job cuts total 332,931, which is 4.0 percent fewer than the 347,095 cuts announced between January and August of last year.

August job cuts were heaviest in the tech sector, where electronics firm Cisco Systems announced plans to reduce its payroll by 6,000 jobs following weak quarterly sales numbers. It joins fellow tech-sector giants Microsoft, Hewlett-Packard, and Intel in announcing large downsizing initiatives this year.

To date, employers in the technology sector, including computer, telecommunications, and electronics firms have announced 80,088 job cuts in 2014. That is 41 percent more than the 56,918 tech-sector job cuts announced in all of 2013.

Computer firms have experienced the heaviest downsizing so far this year, announcing a total of 48,928 job cuts, to date. That is 87 percent more than the 26,180 job cut announced by this industry through August 2013.

Electronics firms, such as Cisco Systems, have seen the largest increase in year-over-year job cuts. The 16,406 job cuts announced by these firms to date ranks ninth among all industries. However, that total represents a 170 percent increase from the 6,078 job cuts announced during the same period in 2013.

Meanwhile, retailers have the second highest number of job cuts this year, but downsizing in the industry has slowed from a year ago. Retail employers have announced plans to shed 30,109 workers so far this year, which is 15 percent fewer than the 35,567 planned layoffs recorded by this point in 2013.

Like retail, the majority of industries have seen job cuts decline in 2014. For many of the industries where job cuts are on the rise, economic weakness is not the driving factor. Instead, the cuts appear to be motivated by fundamental changes in the industry.

Electronics, computer, telecommunications, transportation, and entertainment are all areas that should be flourishing right now. And, in many cases, firms in these industries are doing well. The cuts we are seeing, are coming from companies that did not keep up with the rapidly changing trends that are constantly redefining what products and services are in demand. Now, they are playing catch-up, laying off workers in some areas, hiring in others, and simply cutting layers of management in order to become more nimble and better prepared to meet the next trend shift.


Beige Book: Economic Activity Continues to Expand at Steady Pace
Posted: September 3, 2014 at 02:00 PM (Wednesday)

Reports from the twelve Federal Reserve Districts indicated that economic activity has expanded since the previous Beige Book report; however, none of the Districts pointed to a distinct shift in the overall pace of growth. The New York, Cleveland, Chicago, Minneapolis, Dallas, and San Francisco Districts characterized their growth rates as moderate; Philadelphia, Atlanta, St. Louis, and Kansas City reported modest growth. Boston reported that business activity appeared to be improving, and Richmond reported further strengthening. Philadelphia, Atlanta, Chicago, Kansas City, and Dallas explicitly reported that contacts in their Districts generally remained optimistic about future growth; most of the other Districts cited various examples of ongoing optimism from specific sectors.

General consumer spending grew in most Districts at rates ranging from slight to moderate, with few changes in the pace of growth compared with the last Beige Book. Most Districts reported a continued expansion of auto sales, noting record-high levels for several markets within the Philadelphia and Dallas Districts; however, in some parts of the New York and Philadelphia Districts sales began to fall back from their relatively high levels. Tourism activity was reported to have increased across much of the nation, with many Districts reporting higher hotel booking and occupancy rates.

Activity among nonfinancial service sectors improved overall. District reports on manufacturing were mixed--divided almost evenly into one of three characterizations of the sector's activity: expanding, contracting, or unchanged. Among Districts reporting on their firms' near-term expectations, the manufacturing outlook remained generally upbeat, with New York, Philadelphia, Richmond, and Atlanta reporting increased optimism.

Since the previous Beige Book, residential real estate activity, particularly sales of existing homes and construction of new homes, generally expanded or held steady in about half of the Districts. About half of the Districts also reported some growth in construction and in sales or leasing of nonresidential properties.

Overall, loan demand rose in eight Districts and held steady in one. Credit standards were largely unchanged. Six Districts reported improving credit quality, falling delinquency rates, or both.

Reports regarding farm products were mixed; for some crops, high anticipated harvests have put downward pressure on prices and expected farm incomes. Generally, oil and gas production and demand for related activities continued to edge up from already high levels, while total coal production mostly held steady.

Trends in employment, wages, and prices were relatively unchanged in the Federal Reserve Districts, with greater wage pressures reported in sectors where shortages of skilled labor persisted.


New orders for manufactured goods increased 10.5%
Posted: September 3, 2014 at 10:00 AM (Wednesday)

New orders for manufactured goods in July, up five of the last six months, increased $53.1 billion or 10.5 percent to $558.3 billion, the U.S. Census Bureau reported today. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 1.5 percent June increase. Excluding transportation, new orders decreased 0.8 percent.

Shipments, up five of the last six months, increased $6.0 billion or 1.2 percent to $507.4 billion. This was also at the highest level since the series was first published on a NAICS basis and followed a 0.8 percent June increase.

Unfilled orders, up fifteen of the last sixteen months, increased $58.9 billion or 5.4 percent to $1,158.2 billion. This was also at the highest level since the series was first published on a NAICS basis and followed a 1.0 percent June increase. The unfilled orders-to-shipments ratio was 6.64, up from 6.47 in June.

Inventories, up twenty of the last twenty-one months, increased $0.9 billion or 0.1 percent to $653.8 billion. This was also at the highest level since the series was first published on a NAICS basis and followed a 0.2 percent June increase. The inventories-to-shipments ratio was 1.29, down from 1.30 in June.


Help Wanted OnLine Labor Demand Rises 164,600 in August
Posted: September 3, 2014 at 10:00 AM (Wednesday)

Online advertised vacancies gained 164,600 to 5,209,200 in August, according to The Conference Board Help Wanted OnLine® (HWOL) Data Series released today. The July Supply/Demand rate stands at 1.9 unemployed for each advertised vacancy with a total of 4.6 million more unemployed workers than the number of advertised vacancies. The number of unemployed was 9.7 million in July.

“Labor demand has shown some renewed strength over the past three months with an average increase of 102,000 per month,” said Gad Levanon, Director of Macroeconomics and Labor Markets at The Conference Board. “The 2014 gains through August are an improvement over the slower-paced gains of 2013 for the same time period.”

In August the professional occupations continued to show improvements after earlier 2014 losses. Gains included Business and Finance (10,700), Computer and Math (19,300), and Healthcare (24,200). The Services/Production occupations also showed gains in Office and Administration (20,100), Sales (13,900), and Food Preparation (12,300).


New York Purchasing Managers Business Activity dropped to 57.1 in August
Posted: September 3, 2014 at 08:30 AM (Wednesday)

New York City business activity expanded at the slowest pace in three months, according to the survey taken by the Institute for Supply Management-New York (ISM-NY).

Current Business Conditions were 57.1 in August, cooling down from July’s eight-month high, but still running above the long-run average (between 55-56).

Future optimism came off a five-month high, but maintained solid expansion. The Six-Month Outlook came in at 67.8 in August.

Job growth accelerated to the best reading on record since this series began in November 2007. Employment improved to 67.4 in August.

Purchase volume quickened to a six-month high. Quantity of Purchases rose to 59.1 in August.

Price measures firmed. Prices Paid increased to a three-year high of 67.4 in August, and Prices Received hit a six-month high of 62.5 in August.

The top line and forward guidance both improved to the highest levels in six months. Current Revenues were 71.4 in August, and Expected Revenues were 75.0 in August.


ICSC Chain Store Sales unch% in Aug 30 Wk
Posted: September 3, 2014 at 07:45 AM (Wednesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 4.8% for the week ending August 30 - relative to the prior year. On a week-over-week basis, sales were unchanged.

"According to the ICSC-GS consumer tracking survey business was overall very healthy, and extremely strong for dollar stores and wholesale cubs. With relatively positive weather over the pre-Labor Day weekend, other retailers - department, discount, apparel, electronic and furniture stores - all experienced solid sales." said Michael Niemira, ICSC research consultant. "For the month of August, which is when most of the back-to-school shopping occurs, I expect sales to show a gain of 4% to 5%," he added.


Purchase Apps up, Refi's up in Latest MBA Weekly Survey
Posted: September 3, 2014 at 07:45 AM (Wednesday)

Mortgage applications increased 0.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 29, 2014.

The Market Composite Index, a measure of mortgage loan application volume, increased 0.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 1 percent compared with the previous week. The Refinance Index increased 1 percent from the previous week. The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 4 percent compared with the previous week and was 12 percent lower than the same week one year ago.

The refinance share of mortgage activity increased to 57 percent of total applications, the highest level since March 2014, from 56 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.8 percent of total applications.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.25 percent, the lowest level since June 2013, from 4.28 percent, with points decreasing to 0.24 from 0.25 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) remained unchanged at 4.22 percent, with points decreasing to 0.19 from 0.28 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.99 percent from 3.98 percent, with points decreasing to 0.03 from 0.13 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.48 percent from 3.47 percent, with points decreasing to 0.30 from 0.34 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.

The average contract interest rate for 5/1 ARMs increased to 3.19 percent from 3.10 percent, with points decreasing to 0.45 from 0.52 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.


August Manufacturing ISM expanded at 59
Posted: September 2, 2014 at 10:00 AM (Tuesday)

Economic activity in the manufacturing sector expanded in August for the 15th consecutive month, and the overall economy grew for the 63rd consecutive month, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®.

The August PMI® registered 59 percent, an increase of 1.9 percentage points from July's reading of 57.1 percent, indicating continued expansion in manufacturing. This month's PMI® reflects the highest reading since March 2011 when the index registered 59.1 percent. The New Orders Index registered 66.7 percent, an increase of 3.3 percentage points from the 63.4 percent reading in July, indicating growth in new orders for the 15th consecutive month. The Production Index registered 64.5 percent, 3.3 percentage points above the July reading of 61.2 percent. The Employment Index grew for the 14th consecutive month, registering 58.1 percent, a slight decrease of 0.1 percentage point below the July reading of 58.2 percent. Inventories of raw materials registered 52 percent, an increase of 3.5 percentage points from the July reading of 48.5 percent, indicating growth in inventories following one month of contraction. The August PMI® is led by the highest recorded New Orders Index since April 2004 when it registered 67.1 percent. At the same time, comments from the panel reflect a positive outlook mixed with caution over global geopolitical unrest.

Of the 18 manufacturing industries, 17 are reporting growth in August in the following order: Plastics & Rubber Products; Furniture & Related Products; Fabricated Metal Products; Apparel, Leather & Allied Products; Wood Products; Printing & Related Support Activities; Miscellaneous Manufacturing; Paper Products; Petroleum & Coal Products; Food, Beverage & Tobacco Products; Nonmetallic Mineral Products; Chemical Products; Primary Metals; Transportation Equipment; Computer & Electronic Products; Machinery; and Electrical Equipment, Appliances & Components. The only industry reporting contraction in August is Textile Mills.


Construction Spending increased 1.8% in July
Posted: September 2, 2014 at 10:00 AM (Tuesday)

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during July 2014 was estimated at a seasonally adjusted annual rate of $981.3 billion, 1.8 percent (±1.6%) above the revised June estimate of $963.7 billion. The July figure is 8.2 percent (±2.3%) above the July 2013 estimate of $906.6 billion. During the first 7 months of this year, construction spending amounted to $535.4 billion, 7.9 percent (±1.5%) above the $496.3 billion for the same period in 2013.

PRIVATE CONSTRUCTION
Spending on private construction was at a seasonally adjusted annual rate of $701.7 billion, 1.4 percent (±0.8%) above the revised June estimate of $692.2 billion. Residential construction was at a seasonally adjusted annual rate of $358.1 billion in July, 0.7 percent (±1.3%)* above the revised June estimate of $355.6 billion. Nonresidential construction was at a seasonally adjusted annual rate of $343.6 billion in July, 2.1 percent (±0.8%) above the revised June estimate of $336.6 billion.

PUBLIC CONSTRUCTION
In July, the estimated seasonally adjusted annual rate of public construction spending was $279.6 billion, 3.0 percent (±3.0%)* above the revised June estimate of $271.5 billion. Educational construction was at a seasonally adjusted annual rate of $63.5 billion, 1.6 percent (±4.9%)* above the revised June estimate of $62.5 billion. Highway construction was at a seasonally adjusted annual rate of $84.8 billion, 6.9 percent (±7.7%)* above the revised June estimate of $79.3 billion.


Paychex-IHS Small Business Jobs Index decreased to 100.99 in August
Posted: September 2, 2014 at 08:30 AM (Tuesday)

While the Paychex | IHS Small Business Jobs Index grew 0.20 percent in the past 12 months through August, the national index decreased to 100.99, as the pace of small business employment growth slowed slightly. August marks the third decline for the index in the past four months. Strong small business employment growth propelled the Mountain region into the lead among regions. Wisconsin surpassed Washington, taking over as the top performing state. Among the metro areas, Dallas continues to hold the top spot, now for the third consecutive month.

Although the Paychex | IHS Small Business Jobs Index continues to show positive year-over-year growth, the short-term trend has declined 0.16 percent in the past three months. As most other employment indicators accelerated over the summer, it appears that small businesses may have been on the front end of that trend, in the spring, with the index reaching its peak level in April 2014.

The index continues to show positive, long-term gains. However, that growth has slowed in the past several months.

The August 2014 Paychex | IHS Small Business Jobs Index fell 0.11 percent from last month as the pace of employment growth slowed slightly. The record employment growth rate set in April 2014 has declined three of the past four months.


University of Michigan Consumer Confidence increased in August to 82.5
Posted: August 29, 2014 at 10:00 AM (Friday)

Consumers reported that their finances had improved due to more jobs, higher wages, and gains in wealth. Indeed, consumers judged their current financial situation more favorably than anytime since the start of the Great Recession. While past gains have usually been associated with optimism about future gains, consumers remained skeptical about their future financial prospects. Most of the August gains were driven by rising stock prices and wages among households in the top third of the income distribution, while those in the bottom two-thirds reported slightly less positive gains than in July. To be sure, all households have benefited from the resurgent economy. The data indicate that consumption spending will grow at a 2.5% pace in the year ahead.

Gap in Finances Widens
A growing divide in personal finances across income groups was found in the latest survey. Among households with incomes in the top third, 59% reported being better off, compared with just 36% with incomes in the bottom two-thirds. Net income gains were reported by 34% among the top third in incomes, compared with no net gains in the bottom two-thirds. Moreover, net wealth gains were cited by 22% with incomes the top third, while just 2% cited net wealth gains in the bottom two-thirds. Importantly, these gaps have widened in the past year.

Less Optimism about Future Prospects
People do not expect as much financial progress during the year ahead as in the past year. Among households with incomes in the top third, just 39% expect to improve financially, significantly less than the 59% who reported recent financial progress, and only 27% expect improvement among those with incomes in the bottom two thirds, well below the 36% who reported recent financial gains.

Consumer Sentiment Index
The Sentiment Index was 82.5 in the August 2014 survey, just above the 81.8 in July and slightly above last August’s 82.1. Over the past nine months, the Sentiment Index has remained largely unchanged, in the narrow range between 80.0 and 82.5. The renewed strength in the past year was focused on Current Conditions (+4.8%), while the Expectations Index fell by a slightly larger amount (-3.3%).

The stability in consumer expectations during the past nine months has helped to insulate the economy from much larger swings in business investments. At the same time, the problem is that confidence has been unable to rise above those modestly positive levels. This reflects the ability of the Fed to raise asset prices, which has primarily benefitted upper income households, and their inability to prompt wage increases, which has prevented the reestablishment of a more broadly based optimism. A weakened trend in equity and home prices in the absence of resurgent wages would threaten the modest pace of consumer spending now expected.


Chicago Purchasing Managers Index surged 11.7 points to 64.3 in August
Posted: August 29, 2014 at 09:45 AM (Friday)

The Chicago Business Barometer surged 11.7 points to 64.3 in August, regaining all the lost ground seen in July, and pointing to continued strength in the US economy.

Strong growth in the Barometer and three of its key components in August followed a sharp slowdown in July. As expected, it appears that the July lull was temporary and that the momentum exhibited in the Chicago Report in the second quarter has carried through to Q3.

Strong gains in Production, New Orders and Order Backlogs lifted the Barometer in August to the highest since May. Production posted the largest monthly increase on record, rising over 20 points to the highest in nearly ten years. Both New Orders and Order Backlogs rose sharply unwinding all and more of July’s weakening, with the latter moving well out of contraction.

Employment was the only component of the Barometer to fall, although it remained well above the neutral 50 level and continues to point to firm demand for labour.

With expectations for strong future demand, firms built stocks at the fastest pace for eight years. Inventories of finished goods jumped above 60 to the highest since October 2006, coupled with a fourth consecutive monthly increase in Supplier Delivery Times.

Prices Paid also inched up above 60 amid strong demand, although at this level it doesn’t point to a severe inflationary threat.

Commenting on the MNI Chicago Report, Philip Uglow, Chief Economist at MNI Indicators said, “We had speculated that July’s downturn would prove temporary rather than signal the start of a downward trend. The sharp bounceback in August, with growth in output at the highest for nearly ten years, suggests that growth in the US economy will continue apace in Q3.“


Personal Income increased 0.2%, Spending decreased 0.1%
Posted: August 29, 2014 at 08:30 AM (Friday)

Personal income increased $28.6 billion, or 0.2 percent, and disposable personal income (DPI) increased $17.7 billion,or 0.1 percent, in July, according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) decreased $13.6 billion, or 0.1 percent. In June, personal income increased $67.1 billion, or 0.5 percent, DPI increased $62.9 billion, or 0.5 percent, and PCE increased $50.5 billion, or 0.4 percent, based on revised estimates.

Real DPI increased 0.1 percent in July, compared with an increase of 0.3 percent in June. Real PCE decreased 0.2 percent, in contrast to an increase of 0.2 percent.


Kansas City Fed Manufacturing Activity slowed slightly in August
Posted: August 28, 2014 at 11:00 AM (Thursday)

Growth in Tenth District manufacturing activity slowed slightly in August, but producer’ expectations for future activity remained solid. Price indexes indicated little change from the previous month , but expectations for future growth were slightly lower.

The month-over-month composite index was 3 in August, down from 9 in July and 6 in June. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. The overall slowing in manufacturing activity occurred at nondurable goods producers, while durable goods production increased somewhat. Most month-over-month indexes fell compared to July’s readings. The production index fell from 11 to 4 , and the shipments and new orders indexes also declined but remained above zero. The employment index was -4, the first negative result in 10 months, while the order backlog index remained relatively steady at -5. The inventory indexes were mixed , with materials slightly lower and finished goods considerably higher than in July.

Year-over-year factory indexes were mostly lower. The composite year-over-year index was unchanged at 13, while production index dropped from 24 to 8, its lowest level in seven months. The shipments, new orders, and order backlog indexes also fell. In contrast, the capital expenditures index rose from 10 to 14, after falling last month. The raw materials and finished good inventory indexes both increased considerably over last month.

Future factory indexes were mixed in August. The future composite index edged up from 15 to 17, and the future production, new orders, and order backlog indexes also rose. The future new orders for exports index increased to its highest level in seven months, while the future shipments index decreased from 28 to 20. The future employment index fell moderately, from 23 to 15, and the future capital expenditures index also declined. Both future inventories indexes increased moderately after being in negative territory last month.

Price indexes were once again mixed this month. The month-over-month raw materials price moved up slightly, while the finished goods price index was somewhat lower. The year-over-year finished goods price index eased from 37 to 35, but the raw materials price index remained unchanged. The future raw materials price index continued to edge lower from 46 to 43, and the future finished goods price index also decreased, indicating fewer firms plan to pass cost increases through to customers.


Pending Home Sales Index climbed 3.3% in July
Posted: August 28, 2014 at 10:00 AM (Thursday)

Pending home sales rebounded in July and have now risen in four of the last five months, according to the National Association of Realtors®. All major regions experienced healthy gains except for the Midwest, which saw a slight decline.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, climbed 3.3 percent to 105.9 in July from 102.5 in June, but is still 2.1 percent below July 2013 (108.2). The index is at its highest level since August 2013 (107.1) and is above 100 – considered an average level of contract activity – for the third consecutive month.

Lawrence Yun, NAR chief economist, says favorable housing conditions are behind July’s higher contract activity. “Interest rates are lower than they were a year ago, price growth continues to moderate and total housing inventory is at its highest level since August 20121,” he said. “The increase in the number of new and existing homes for sale is creating less competition and is giving prospective buyers more time to review their options before submitting an offer.”

Yun adds, “More importantly, steady job additions to the economy are helping family finances and giving them added confidence to enter the market.”

The PHSI in the Northeast jumped 6.2 percent to 89.2 in July, and is 8.3 percent above a year ago. In the Midwest the index marginally fell 0.4 percent to 104.6 in July, and is 6.4 percent below July 2013.

Pending home sales in the South increased 4.2 percent to an index of 119.0 in July, and is now 1.0 percent below a year ago. The index in the West rose 4.0 percent in July to 99.5, but remains 6.0 percent below July 2013.

Yun expects existing-homes sales to be down 2.1 percent this year to 4.98 million, compared to 5.09 million sales of existing homes in 2013. The national median existing-home price is projected to grow between 5 and 6 percent this year and 4 and 5 percent next year.


DJ-BTMU U.S. Business Barometer unch%
Posted: August 28, 2014 at 10:00 AM (Thursday)

For the week ending August 16 2014, the DJ-BTMU U.S. Business Barometer remained at 98.4 as negative performances of consumption indexes were cancelled out by gains in production indexes. Chain store sales fell by a sharp 1.3 percent, extending the weakening trend to two weeks. MBA’s purchase index also dropped 0.4 percent this week. As to the production side, all indexes except coal and steel production reported significant gains. For instance, auto production and electric output surged 2.4 and 1.8 percent, respectively.

On a year-over-year basis, the barometer showed a gain of 1.2 percent, which compares to an average -3.3 percent decline over the Great Recession (ended in June 2009 according to the NBER). After flat lining in 2006, and declining from 2007 through 2009, the barometer bounced back in 2010 to rise by 3.4 percent, which was the strongest increase since 1994 (+4.0 percent), but not so impressive when compared to an -8.0 percent drop in 2009. The rate of increase for the 2013 slowed to 0.7 percent following 1.5 percent in 2012.

The smoothed version of the barometer, which attempts to account for weekly volatility, remained at 98.5. Its year-over-year growth rate was 1.1 percent.


2Q2014 GDP preliminary estimate increased 4.2%
Posted: August 28, 2014 at 08:30 AM (Thursday)

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 4.2 percent in the second quarter of 2014, according to the "second" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP decreased 2.1 percent.

The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month. In the advance estimate, the increase in real GDP was 4.0 percent. With this second estimate for the second quarter, the general picture of economic growth remains the same; the increase in nonresidential fixed investment was larger than previously estimated, while the increase in private inventory investment was smaller than previously estimated.

The increase in real GDP in the second quarter primarily reflected positive contributions from personal consumption expenditures (PCE), private inventory investment, exports, nonresidential fixed investment, state and local government spending, and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.

Real GDP increased 4.2 percent in the second quarter after decreasing 2.1 percent in the first. This upturn in the percent change in real GDP primarily reflected upturns in exports and in private inventory investment, accelerations in PCE and in nonresidential fixed investment, and upturns in state and local government spending and in residential fixed investment that were partly offset by an acceleration in imports.


Weekly Initial Unemployment Claims Decrease 1,000 to 298,000
Posted: August 28, 2014 at 08:30 AM (Thursday)

In the week ending August 23, the advance figure for seasonally adjusted initial claims was 298,000, a decrease of 1,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 298,000 to 299,000. The 4-week moving average was 299,750, a decrease of 1,250 from the previous week's revised average. The previous week's average was revised up by 250 from 300,750 to 301,000. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.9 percent for the week ending August 16, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending August 16 was 2,527,000, an increase of 25,000 from the previous week's revised level. The previous week's level was revised up 2,000 from 2,500,000 to 2,502,000. The 4-week moving average was 2,524,250, a decrease of 3,750 from the previous week's revised average. The previous week's average was revised up by 500 from 2,527,500 to 2,528,000.


Purchase Apps up, Refi's up in Latest MBA Weekly Survey
Posted: August 27, 2014 at 07:00 AM (Wednesday)

Mortgage applications increased 2.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 22, 2014.

The Market Composite Index, a measure of mortgage loan application volume, increased 2.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 2 percent compared with the previous week. The Refinance Index increased 3 percent from the previous week. The seasonally adjusted Purchase Index increased 3 percent from one week earlier. The unadjusted Purchase Index increased 1 percent compared with the previous week and was 11 percent lower than the same week one year ago.

The refinance share of mortgage activity increased to 56 percent of total applications, the highest level since March 2014, from 55 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 8.0 percent of total applications.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.28 percent from 4.29 percent, with points decreasing to 0.25 from 0.26 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) increased to 4.22 percent from 4.18 percent, with points increasing to 0.28 from 0.23 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.98 percent, the lowest since June 2013, from 3.99 percent, with points increasing to 0.13 from 0.03 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.47 percent from 3.44 percent, with points increasing to 0.34 from 0.30 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs remained unchanged at 3.10 percent, with points increasing to 0.52 from 0.44 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.


Consumer Confidence increased in August to 92.4
Posted: August 26, 2014 at 10:00 AM (Tuesday)

The Conference Board Consumer Confidence Index®, which had increased in July, improved further in August. The Index now stands at 92.4 (1985=100), up from 90.3 in July. The Present Situation Index increased to 94.6 from 87.9, while the Expectations Index edged down to 90.9 from 91.9 in July.

Consumer confidence increased for the fourth consecutive month as improving business conditions and robust job growth helped boost consumers’ spirits. Looking ahead, consumers were marginally less optimistic about the short-term outlook compared to July, primarily due to concerns about their earnings. Overall, however, they remain quite positive about the short-term outlooks for the economy and labor market.

Consumers’ appraisal of current conditions continued to improve through August. Those saying business conditions are “good” edged up to 23.9 percent from 23.3 percent, while those claiming business conditions are “bad” declined to 21.5 percent from 22.8 percent. Consumers’ assessment of the job market was also more positive. Those stating jobs are “plentiful” increased to 18.2 percent from 15.6 percent, while those claiming jobs are “hard to get” declined marginally to 30.6 percent from 30.9 percent.

Consumers were slightly less optimistic in August about the short-term outlook. The percentage of consumers expecting business conditions to improve over the next six months held steady at 20.4 percent, while those expecting business conditions to worsen fell to 10.2 percent from 12.1 percent. Consumers, however, were somewhat mixed about the outlook for the labor market. Those anticipating more jobs in the months ahead fell to 17.0 percent from 18.7 percent, although those anticipating fewer jobs also declined to 15.8 percent from 16.6 percent. Fewer consumers expect their incomes to grow, 15.5 percent in August versus 17.7 percent in July, while those expecting a drop in their incomes rose marginally to 11.9 percent from 11.1 percent.


Richmond Fed's Current Activity Index climbed to a reading of 12
Posted: August 26, 2014 at 10:00 AM (Tuesday)

Fifth District manufacturing activity continued to improve in August, according to the most recent survey by the Federal Reserve Bank of Richmond. Shipments and the volume of new orders picked up this month. Although manufacturing employment and average wages rose at a slower pace this month, the average workweek lengthened.

Manufacturers anticipated stronger business conditions during the next six months. Firms expected faster growth in shipments and new orders in the six months ahead. Additionally, survey participants looked for increased capacity utilization and expected order backlogs to grow more quickly. Expectations were for longer vendor lead times.

Survey participants' outlook for the months ahead also included faster growth in average wages and the average workweek, with a pickup in hiring.

Prices of raw materials and finished goods rose at slower pace in August compared to last month. In contrast, manufacturers expected faster growth in prices paid and prices received over the next six months.

Overall, manufacturing conditions continued to improve in August. The composite index for manufacturing climbed to a reading of 12, the highest reading since March 2011. The index for shipments gained seven points and the new orders index advanced eight points, finishing at readings of 10 and 13, respectively. Manufacturing employment grew more slowly this month; the employment indicator slipped two points to a reading of 11.

Backlogs rose at a faster pace this month; the index jumped to a reading of 15. Additionally, capacity utilization grew at a faster pace, pushing the index up 13 points ending at 17. Vendor lead time lengthened, moving the index to 16 from a reading of 12 last month. Finished goods inventories rose at a faster pace compared to a month ago. The index gained four points, ending at 16. In contrast, raw materials inventories increased at a slower rate compared to last month. That gauge moved to 17 from 21.


S&P/Case-Shiller Home Price Indices gained 1.0% in June
Posted: August 26, 2014 at 09:00 AM (Tuesday)

Data through June 2014, released today by S&P Dow Jones Indices for its S&P/Case-Shiller1 Home Price Indices, the leading measure of U.S. home prices, show a sustained slowdown in price increases. The National Index gained 6.2% in the 12 months ending June 2014 while the 10-City and 20-City Composites gained 8.1%; all three indices saw their rates slow considerably from last month. Every city saw its year-over-year return worsen.

The National Index, now being published monthly, gained 0.9% in June. The 10- and 20-City Composites increased 1.0%. New York led the cities with a return of 1.6% and recorded its largest increase since June 2013. Chicago, Detroit and Las Vegas followed at +1.4%. Las Vegas posted its largest monthly gain since last summer.

The S&P/Case-Shiller U.S. National Home Price Index, which covers all nine U.S. census divisions, recorded a 6.2% annual gain in June 2014. The 10- and 20-City Composites posted year-over-year increases of 8.1%.

Home price gains continue to ease as they have since last fall. For the first time since February 2008, all cities showed lower annual rates than the previous month. Other housing indicators – starts, existing home sales and builders’ sentiment – are positive. Taken together, these point to a more normal housing sector.

The monthly National Index rose 0.9% in June. While all 20 cities saw higher home prices over the last 12 months, all experienced slower gains. In San Francisco, the pace of price increases halved since late last summer. The Sun Belt cities – Las Vegas, Phoenix, Miami and Tampa – all remain a third or more below their peak prices set almost a decade ago.

Bargain basement mortgage rates won’t continue forever; recent improvements in the labor markets and comments from Fed chair Janet Yellen and others hint that interest rates could rise as soon as the first quarter of 2015. Rising mortgage rates won’t send housing into a tailspin, but will further dampen price gains.

As of June 2014, average home prices across the United States are back to their levels posted in the spring of 2005. The National Index was up 0.9% over May 2014 and 6.2% above June 2013.

As of June 2014, average home prices across the United States are back to their autumn 2004 levels. Measured from their June/July 2006 peaks, the peak-to-current decline for both Composites is approximately 17%. The recovery from the March 2012 lows is 27.8% and 28.5% for the 10-City and 20-City Composites.

All 20 cities saw their year-over-year rates weaken in June. For the second consecutive month, San Francisco saw its rate decelerate by almost three percentage points – from 18.4% in April to 12.9% in June. Phoenix showed its smallest year-over-year gain of 6.9% since March 2012. Cleveland showed a marginal increase of 0.8% over the last 12 months while Las Vegas led with a gain of 15.2%.

All cities reported price increases for the third consecutive month; it would have been a fourth had New York not declined 0.4% in March. San Francisco posted its eighth consecutive price increase but showed its smallest gain of 0.3% since February. Five cities – Detroit, Las Vegas, New York, Phoenix and San Diego – posted larger gains in June than in May. Dallas and Denver continue to set new peaks while Detroit remains the only city below its January 2000 value.


New Orders for Durable Goods Increased 22.6%, Ex-Trans Up 0.8%
Posted: August 26, 2014 at 08:30 AM (Tuesday)

New orders for manufactured durable goods in July increased $55.3 billion or 22.6 percent to $300.1 billion, the U.S. Census Bureau announced today. This increase, up five of the last six months, was at the highest level since the series was first published on a NAICS basis in 1992, and followed a 2.7 percent June increase. Excluding transportation, new orders decreased 0.8 percent. Excluding defense, new orders increased 24.9 percent. Transportation equipment, also up five of the last six months, drove the increase, $56.6 billion or 74.2 percent to $133.0 billion.

Shipments of manufactured durable goods in July, up five of the last six months, increased $8.0 billion or 3.3 percent to $248.9 billion. This was at the highest level since the series was first published on a NAICS basis and followed a 1.2 percent June increase. Transportation equipment, up two consecutive months, led the increase, $5.6 billion or 7.9 percent to $76.3 billion.

Unfilled orders for manufactured durable goods in July, up fifteen of the last sixteen months, increased $59.2 billion or 5.4 percent to $1,158.5 billion. This was at the highest level since the series was first published on a NAICS basis and followed a 1.0 percent June increase. Transportation equipment, up ten of the last eleven months, led the increase, $56.7 billion or 8.3 percent to $738.4 billion.

Inventories of manufactured durable goods in July, up fifteen of the last sixteen months, increased $2.1 billion or 0.5 percent to $401.9 billion. This was at the highest level since the series was first published on a NAICS basis and followed a 0.5 percent June increase. Transportation equipment, also up fifteen of the last sixteen months, led the increase, $0.7 billion or 0.5 percent to $129.6 billion.

Nondefense new orders for capital goods in July increased $51.5 billion or 60.8 percent to $136.3 billion. Shipments increased $1.1 billion or 1.4 percent to $79.1 billion. Unfilled orders increased $57.2 billion or 8.6 percent to $725.2 billion. Inventories increased $2.3 billion or 1.2 percent to $184.2 billion.

Defense new orders for capital goods in July decreased $1.5 billion or 15.3 percent to $8.6 billion. Shipments increased $0.2 billion or 1.7 percent to $9.6 billion. Unfilled orders decreased $1.0 billion or 0.6 percent to $159.5 billion. Inventories decreased $0.2 billion or 1.0 percent to $23.8 billion.

Revised seasonally adjusted June figures for all manufacturing industries were: new orders, $505.6 billion (revised from $503.2 billion); shipments, $501.7 billion (revised from $499.8 billion); unfilled orders, $1,099.3 billion (revised from $1,098.5 billion); and total inventories, $654.1 billion (revised from $653.8 billion).


ICSC Chain Store Sales increased by 0.6% in Aug 23 Wk
Posted: August 26, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 4.2% for the week ending August 23 - relative to the prior year. On a week-over-week basis, sales increased 0.6%.

"According to the ICSC-GS consumer tracking survey business was strong across the board - especially for wholesale clubs, apparel stores, discounters, dollar stores, and furniture stores - as consumers continued their back-to-school shopping," said Michael Niemira, ICSC research consultant. "I expect sales for August to show a healthy gain of 4-5% - a notable improvement over the 3.6% gain in August 2013," he added


Texas Manufacturing Activity Expands but at a Slower Pace
Posted: August 25, 2014 at 10:30 AM (Monday)

Texas factory activity increased again in August, albeit at a slower pace than in recent months, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, fell from 19.1 to 6.8, indicating output growth slowed from July.

Other measures of current manufacturing activity also reflected notably slower growth in August. The new orders index fell 11 points to 2.2 after surging in July. The capacity utilization index also posted a sharp decline, moving down from 18 to 3.6. The shipments index experienced the largest fall, from 22.8 to 6.4, reaching its lowest reading in eight months.

Perceptions of broader business conditions were less optimistic this month. The general business activity index remained positive but fell to a five-month low of 7.1. The company outlook fell from 11.3 to 1.5, due to a smaller share of firms noting an improved outlook in August than in July.

Labor market indicators reflected continued employment growth and longer workweeks. The August employment index posted a third robust reading, holding steady at 11.1. Twenty-one percent of firms reported net hiring compared with 10 percent reporting net layoffs. The hours worked index slipped from 6.3 to 2.9, indicating a smaller rise in hours worked than last month.

Upward pressure on input prices continued at about the same pace in August as in July, while pressure increased for selling prices and wages. The raw materials price index held fairly steady at 26.4. The finished goods price index edged up from 7.3 to 9.1, reaching its highest level in six months. The wages and benefits index rose 5 points to 23.7, also posting a six-month high.

Expectations regarding future business conditions remained optimistic in August. The index of future general business activity inched down 1 point to 18.7, while the index of future company outlook rose 6 points to 30.1. Indexes for future manufacturing activity showed mixed movements in August but remained in solidly positive territory.


New Home Sales in July at annual rate of 412,000
Posted: August 25, 2014 at 10:00 AM (Monday)

Sales of new single-family houses in July 2014 were at a seasonally adjusted annual rate of 412,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 2.4 percent (±11.9%) below the revised June rate of 422,000, but is 12.3 percent (±17.1%) above the July 2013 estimate of 367,000.

The median sales price of new houses sold in July 2014 was $269,800; the average sales price was $339,100. The seasonally adjusted estimate of new houses for sale at the end of July was 205,000. This represents a supply of 6.0 months at the current sales rate.


Chicago Fed National Activity picked up in July
Posted: August 25, 2014 at 08:30 AM (Monday)

Led by improvements in production-related indicators, the Chicago Fed National Activity Index (CFNAI) rose to +0.39 in July from +0.21 in June. Three of the four broad categories of indicators that make up the index made positive contributions to the index in July, and two of the four categories increased from June.

The index’s three-month moving average, CFNAI-MA3, increased to +0.25 in July from +0.16 in June, marking its fifth consecutive reading above zero. July’s CFNAI-MA3 suggests that growth in national economic activity was somewhat above its historical trend. The economic growth reflected in this level of the CFNAI-MA3 suggests limited inflationary pressure from economic activity over the coming year.

The CFNAI Diffusion Index, which is also a three-month moving average, increased to +0.31 in July from +0.21 in June. Fifty-three of the 85 individual indicators made positive contributions to the CFNAI in July, while 32 made negative contributions. Forty-eight indicators improved from June to July, while 36 indicators deteriorated and one was unchanged. Of the indicators that improved, nine made negative contributions.

Production-related indicators made a contribution of +0.31 to the CFNAI in July, up from +0.05 in June. Manufacturing production rose 1.0 percent in July after rising 0.3 percent in June, and manufacturing capacity utilization rose to 77.8 percent in July from 77.2 percent in the previous month.

Employment-related indicators contributed +0.13 to the CFNAI in July, down from +0.26 in June. The unemployment rate increased to 6.2 percent in July from 6.1 percent in June; however, average weekly initial unemployment insurance claims decreased to 293,500 in July from 315,000 in the previous month. The contribution of the sales, orders, and inventories category to the CFNAI ticked down to +0.05 in July from +0.06 in June.

The contribution of the consumption and housing category to the CFNAI edged up to –0.10 in July from –0.15 in June. Housing starts rose to 1,093,000 annualized units in July from 945,000 in June, and housing permits increased to 1,052,000 annualized units in July from 973,000 in the previous month.

The CFNAI was constructed using data available as of August 21, 2014. At that time, July data for 51 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The June monthly index was revised to +0.21 from an initial estimate of +0.12. Revisions to the monthly index can be attributed to two main factors: revisions in previously published data and differences between the estimates of previously unavailable data and subsequently published data. The revision to the June monthly index was due primarily to the former.


Philadelphia July Outlook Suggests continuing growth
Posted: August 21, 2014 at 10:31 AM (Thursday)

Indicators for the August Business Outlook Survey suggest that the region’s manufacturing sector is continuing to grow. The survey’s indicator for general activity was higher this month, but indicators for new orders, shipments, and employment, while positive, fell from their readings in July. The survey’s broad indicators of future activity increased, suggesting that firms remain optimistic about continued growth over the next six months.

Activity Index Highest Since 2011

The diffusion index of current general activity increased from a reading of 23.9 in July to 28.0 this month. The index has increased for three consecutive months and is at its highest reading since March 2011 (see Chart). The new orders and shipments indexes remained positive but fell to near their levels in June. The new orders index decreased 20 points, while the shipments index decreased 18 points.

The current indicators for labor market conditions suggested continued modest expansion in employment. The employment index remained positive for the 14th consecutive month but declined 3 points from its reading in July. The percentage of firms reporting increases in employment (25 percent) exceeded the percentage reporting decreases (16 percent). The workweek index was positive for the sixth consecutive month and increased 1 point.

Price Pressures Moderate

Nearly 30 percent of the firms reported higher input prices this month, but this was lower than the 36 percent that reported input price increases last month. The prices paid index decreased nearly 10 points from July to its lowest reading in three months. The prices received index, which reflects firms’ own final goods prices, also decreased, from 16.8 to 4.2. The 12 percent of firms reporting higher prices was notably lower than the 21 percent reporting higher prices last month. Over 79 percent of the firms reported steady prices for their own products this month.

Six-Month Indicators Improve

Most of the survey’s broad indicators of future growth showed improvement this month. The future general activity index increased 8 points and is at its highest reading since June 1992 (see Chart). The index has increased for four consecutive months. The future indexes for new orders and shipments also improved this month, increasing 5 and 10 points, respectively. Firms remained relatively optimistic with respect to employment growth, although the future employment index fell 4 points. Nearly 37 percent of the firms are expecting growth in their employment levels over the next six months, but 12 percent of the firms expect employment reductions.

While most broad indicators of future growth have been improving, the survey’s future capital spending index has been slipping. Although the index decreased just 1 point this month, its reading, at 17.5, is now the lowest it has been in seven months.

In special questions this month, firms were asked qualitative questions about the effects of the Affordable Care Act (ACA) and how, if at all, they are making changes to their employment and compensation, including benefits (see Special Questions). Over 18 percent of the firms indicated that the number of workers they employ was lower because of the ACA; 3 percent indicated higher levels. The same percentage (18 percent) indicated that the proportion of part-time workers had increased. Regarding health insurance benefit coverage, 41 percent said their coverage was unchanged, but 52 percent indicated modifications to their offerings. Among those modifying their health insurance coverage, higher deductibles (91 percent), higher worker contributed premiums (88 percent), and higher out-of-pocket maximums (77 percent) were the most cited changes.

Summary

The August Business Outlook Survey suggests continued expansion of the region’s manufacturing sector, although some indicators returned to near their readings in June. Firms reported overall continued increases in general activity, new orders, shipments, and employment this month. The survey’s future activity continued to improve, indicating that firms expect continued growth in manufacturing over the next six months.


U.S. Leading Economic Index increased 0.9%
Posted: August 21, 2014 at 10:00 AM (Thursday)

The Conference Board Leading Economic Index® (LEI) for the U.S. increased 0.9 percent in July to 103.3 (2004 = 100), following a 0.6 percent increase in June, and a 0.6 percent increase in May.

The LEI improved sharply in July, suggesting that the economy is gaining traction and growth should continue at a strong pace for the remainder of the year. Although housing has been one of the weakest components this year, the sharp gain in building permits helped boost the LEI in July. Financial markets and labor market conditions have also supported recent gains, but business spending indicators remain soft and their contribution marginal.

The pace of economic activity remained reasonably strong in July. Although retail sales were a little disappointing, hiring and industrial activity improved. July’s increase in the LEI, coupled with its accelerating growth trend, points to stronger economic growth over the coming months.

The Conference Board Coincident Economic Index® (CEI) for the U.S. increased 0.2 percent in July to 109.6 (2004 = 100), following a 0.3 percent increase in June, and a 0.2 percent increase in May.

The Conference Board Lagging Economic Index® (LAG) for the U.S. increased 0.2 percent in July to 124.6 (2004 = 100), following a 0.5 percent increase in June, and a 0.4 percent increase in May.


Existing-Home Sales rose 2.4% in July
Posted: August 21, 2014 at 10:00 AM (Thursday)

Existing-home sales increased in July to their highest annual pace of the year, and the ongoing decline in distressed sales reached an important milestone, according to the National Association of Realtors®.

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 2.4 percent to a seasonally adjusted annual rate of 5.15 million in July from a slight downwardly-revised 5.03 million in June. Sales are at the highest pace of 2014 and have risen four consecutive months, but remain 4.3 percent below the 5.38 million-unit level from last July, which was the peak of 2013.

Sales momentum is slowly building behind stronger job growth and improving inventory conditions. The number of houses for sale is higher than a year ago and tamer price increases are giving prospective buyers less hesitation about entering the market. More people are buying homes compared to earlier in the year and this trend should continue with interest rates remaining low and apartment rents on the rise.

Warning signs that affordability is likely to decline in upcoming years. Although interest rates have fallen in recent months, median family incomes are still lagging behind price gains, and mortgage rates will inevitably rise with the upcoming changes in monetary policy.

The median existing-home price for all housing types in July was $222,900, which is 4.9 percent above July 2013. This marks the 29th consecutive month of year-over-year price gains.

Total housing inventory at the end of July rose 3.5 percent to 2.37 million existing homes available for sale, which represents a 5.5-month supply at the current sales pace. Unsold inventory is 5.8 percent higher than a year ago, when there were 2.24 million existing homes available for sale.

Distressed homes – foreclosures and short sales – accounted for 9 percent of July sales, down from 15 percent a year ago and the first time they were in the single-digits since NAR started tracking the category in October 2008. Six percent of July sales were foreclosures and 3 percent were short sales. Foreclosures sold for an average discount of 20 percent below market value in July, while short sales were discounted 14 percent.

Yun says the deepest housing wounds suffered during the Great Recession are beginning to fully heal. “To put it in perspective, distressed sales represented an average of 36 percent of sales during all of 2009,” he said. “Fast-forward to today and rising home values are helping owners recover equity and strong job creation are assisting those who may have fallen behind on their mortgage due to unemployment or underemployment.”

All-cash sales in July were 29 percent of transactions, down from 32 percent in June and representing the lowest overall share since January 2013 (28 percent). Individual investors, who account for many cash sales, purchased 16 percent of homes in July, unchanged from last month and July 2013. Sixty-nine percent of investors paid cash in July.

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage fell for the third consecutive month to 4.13 percent in July from 4.16 percent in June, and remains the lowest rate since June 2013 (4.07 percent).

The percent share of first-time buyers in July rose slightly for the second straight month to 29 percent (28 percent in June), but remain historically low.

NAR President Steve Brown, co-owner of Irongate, Inc., Realtors® in Dayton, Ohio, says the new credit scoring calculation recently announced by Fair Isaac Corp., or FICO, will improve access to homeownership. “NAR supports efforts to broaden access to credit for qualified homebuyers, especially those who have been shut out of the housing market or forced to pay higher interest rates because of flawed credit scores,” he said. “A solid credit score is necessary to keep borrowing costs down.”

The median time on market for all homes was 48 days in July, up from 44 days in June; it was 42 days on market in July 2013. Short sales were on the market for a median of 93 days in July, while foreclosures sold in 58 days and non-distressed homes typically took 45 days. Forty percent of homes sold in July were on the market for less than a month.

Single-family home sales increased 2.7 percent to a seasonally adjusted annual rate of 4.55 million in July from 4.43 million in June, but remain 4.2 percent below the 4.75 million pace a year ago. The median existing single-family home price was $223,900 in July, up 5.1 percent from July 2013.

Existing condominium and co-op sales remained unchanged in July from June at an annual rate of 600,000 units, and are 4.8 percent below the 630,000 unit pace a year ago. The median existing condo price was $215,000 in July, which is 3.3 percent higher than a year ago.


DJ-BTMU U.S. Business Barometer declined by 0.3%
Posted: August 21, 2014 at 10:00 AM (Thursday)

For the week ending August 9 2014, the DJ-BTMU U.S. Business Barometer declined by 0.3 percent to 98.4, after remaining flat the previous week. The decrease in this week’s barometer stemmed from weak performances in consumption indexes. Chain store sales and MBA’s purchase index fell by 1.4 and 1.0 percent, respectively. As to the production side, auto production reported solid gains, along with strong electric output; but it was partially offset by a drop of 5.7 percent in truck production.

On a year-over-year basis, the barometer showed a gain of 1.0 percent, which compares to an average -3.3 percent decline over the Great Recession (ended in June 2009 according to the NBER). After flat lining in 2006, and declining from 2007 through 2009, the barometer bounced back in 2010 to rise by 3.4 percent, which was the strongest increase since 1994 (+4.0 percent), but not so impressive when compared to an -8.0 percent drop in 2009. The rate of increase for the 2013 slowed to 0.7 percent following 1.5 percent in 2012.

The smoothed version of the barometer, which attempts to account for weekly volatility, remained at 98.6. Its year-over-year growth rate was 1.2 percent.


Weekly Initial Unemployment Claims Decrease 14,000 to 298,000
Posted: August 21, 2014 at 08:30 AM (Thursday)

In the week ending August 16, the advance figure for seasonally adjusted initial claims was 298,000, a decrease of 14,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 311,000 to 312,000. The 4-week moving average was 300,750, an increase of 4,750 from the previous week's revised average. The previous week's average was revised up by 250 from 295,750 to 296,000. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.9 percent for the week ending August 9, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending August 9 was 2,500,000, a decrease of 49,000 from the previous week's revised level. This is the lowest level for insured unemployment since June 16, 2007 when it was 2,453,000. The previous week's level was revised up 5,000 from 2,544,000 to 2,549,000. The 4-week moving average was 2,527,500, a decrease of 2,000 from the previous week's revised average. The previous week's average was revised up by 1,250 from 2,528,250 to 2,529,500.


Purchase Apps up, Refi's up in Latest MBA Weekly Survey
Posted: August 20, 2014 at 07:00 AM (Wednesday)

Mortgage applications increased 1.4 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 15, 2014.

The Market Composite Index, a measure of mortgage loan application volume, increased 1.4 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 1 percent compared with the previous week. The Refinance Index increased 3 percent from the previous week. The seasonally adjusted Purchase Index decreased 0.4 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 11 percent lower than the same week one year ago.

“Interest rates dropped last week as a result of the ongoing turmoil in Ukraine and other international concerns, which in turn pushed mortgage rates lower,” said Mike Fratantoni, MBA’s Chief Economist. “Overall application volume for conventional mortgages increased. However, there was a 5.9 percent decline in the number of applications for government mortgages, with both purchase and refinance applications declining. Within the government sector, this decline was led by an 8 percent decline in unadjusted Department of Veterans Affairs applications, while Federal Housing Administration and Rural Housing Service unadjusted applications also fell by 5 percent and 3 percent respectively.”

The refinance share of mortgage activity increased to 55 percent of total applications from 54 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.8 percent of total applications.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.29 percent from 4.35 percent, with points increasing to 0.26 from 0.22 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) decreased to 4.18 percent from 4.24 percent, with points increasing to 0.23 from 0.19 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.99 percent from 4.04 percent, while points remained unchanged at 0.03 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.44 percent from 3.48 percent, while points remained unchanged at 0.30 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to 3.10 percent from 3.24 percent, with points decreasing to 0.44 from 0.45 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.


Consumer Price Index increased 0.1% in July, Ex Fd & Engy up 0.1%
Posted: August 19, 2014 at 08:30 AM (Tuesday)

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1 percent in July on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 2.0 percent before seasonal adjustment.

The all items index posted its smallest seasonally adjusted increase since February; the indexes for shelter and food rose, but were partially offset by declines in the energy index and the index for airline fares. The food index rose 0.4 percent in July, with the food at home index also rising 0.4 percent after being unchanged in June. The decrease in the energy index was its first since March and featured declines in the indexes of all the major energy components.

The index for all items less food and energy increased 0.1 percent in July, the same increase as in June. Along with the shelter index, the indexes for medical care, new vehicles, personal care, and apparel all increased in July. Along with the index for airline fares, the indexes for recreation, for used cars and trucks, for household furnishings and operations, and for tobacco all declined in July.

The all items index increased 2.0 percent over the last 12 months, a slight decline from the 2.1 percent figure for the 12 months ending June. The index for all items less food and energy rose 1.9 percent over the last 12 months, the same figure as for the 12 months ending June. The energy index has increased 2.6 percent, and the food index has risen 2.5 percent over the span.


Real Average Hourly Earnings were unchanged% in July
Posted: August 19, 2014 at 08:30 AM (Tuesday)

Real average hourly earnings for all employees was unchanged from June to July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This result stems from an unchanged average hourly earnings, combined with a 0.1 percent increase in the Consumer Price Index for All Urban Consumers (CPI-U).

Real average weekly earnings was unchanged over the month due to both the real average hourly earnings and the average workweek being unchanged.

Real average hourly earnings was unchanged, seasonally adjusted, from July 2013 to July 2014. The unchanged real average hourly earnings, combined with a 0.3 percent increase in the average workweek, resulted in a 0.3 percent increase in real average weekly earnings over this period.


July Housing Starts up 15.7%, Permits up 8.1%
Posted: August 19, 2014 at 08:30 AM (Tuesday)

BUILDING PERMITS
Privately-owned housing units authorized by building permits in July were at a seasonally adjusted annual rate of 1,052,000. This is 8.1 percent (±1.8%) above the revised June rate of 973,000 and is 7.7 percent (±1.8%) above the July 2013 estimate of 977,000. Single-family authorizations in July were at a rate of 640,000; this is 0.9 percent (±1.5%) above the revised June figure of 634,000. Authorizations of units in buildings with five units or more were at a rate of 382,000 in July.

HOUSING STARTS
Privately-owned housing starts in July were at a seasonally adjusted annual rate of 1,093,000. This is 15.7 percent (±10.9%) above the revised June estimate of 945,000 and is 21.7 percent (±10.7%) above the July 2013 rate of 898,000. Single-family housing starts in July were at a rate of 656,000; this is 8.3 percent (±10.3%) above the revised June figure of 606,000. The July rate for units in buildings with five units or more was 423,000.

HOUSING COMPLETIONS
Privately-owned housing completions in July were at a seasonally adjusted annual rate of 841,000. This is 3.7 percent (±8.2%) above the revised June estimate of 811,000 and is 8.0 percent (±9.9%) above the July 2013 rate of 779,000. Single-family housing completions in July were at a rate of 635,000; this is 6.2 percent (±8.8%) above the revised June rate of 598,000. The July rate for units in buildings with five units or more was 199,000.


ICSC Chain Store Sales decreased by 1.3% in Aug 16 Wk
Posted: August 19, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 3.8% for the week ending August 16 - relative to the prior year. On a weekly basis, sales decreased 1.3% compared to the previous week.

"According to the ICSC-GS consumer tracking survey business was very strong over the past week for back-to-school categories - especially electronics and apparel," said Michael Niemira, ICSC research consultant. "Business was also strong for department, drug, discount, wholesale, and furniture stores. Looking ahead, I expect sales for August to show a healthy gain of 4-5% - a notable improvement over the 3.6% gain in August 2013," he added.


Builder Confidence rises 2 points in August to 55
Posted: August 18, 2014 at 10:00 AM (Monday)

Builder confidence in the market for newly built, single-family homes rose two points to 55 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for August, released today. This third consecutive monthly gain brings the index to its highest level since January.

As the employment picture brightens, builders are seeing a noticeable increase in the number of serious buyers entering the market. However, builders still face a number of challenges, including tight credit conditions for borrowers and shortages of finished lots and labor.

All three HMI components posted gains in August. The indices gauging current sales conditions and expectations for future sales each rose two points to 58 and 65, respectively. The index gauging traffic of prospective buyers increased three points to 42.

Each of the three components of the HMI registered consecutive gains for the past three months, which is a positive sign that builder confidence appears to be firming following an uneven spring. Factors contributing to this rise include sustained job growth, historically low mortgage rates and affordable home prices, which are helping to unleash pent-up demand.

Every region saw a gain in its three-month moving average HMI score in August. The Midwest posted a seven-point increase to 55 and the West registered a four-point gain to 56. The Northeast posted a two-point gain to 38 and the South was up one point to 52.


Forecasters Hold the Line on Projections for Growth
Posted: August 15, 2014 at 10:00 AM (Friday)

The outlook for growth in the U.S. economy over the next four years looks mostly unchanged from that of three months ago, according to 43 forecasters surveyed by the Federal Reserve Bank of Philadelphia. The panel expects real GDP to grow at an annual rate of 3.0 percent this quarter and 3.1 percent next quarter. On an annual-average over annual-average basis, the forecasters see real GDP growing 2.1 percent in 2014, down from the previous estimate of 2.4 percent. The forecasters predict real GDP will grow 3.1 percent in 2015, 2.9 percent in 2016, and 2.8 percent in 2017.

Healthier conditions in the labor market accompany the nearly stable outlook for output growth. The forecasters predict the unemployment rate will be an annual average of 6.3 percent in 2014, before falling to 5.7 percent in 2015, 5.4 percent in 2016, and 5.3 percent in 2017. These projections are below those of the last survey.

The forecasters are also more optimistic about the employment outlook. They have revised upward their estimates of the growth in jobs in the next four quarters. The forecasters see nonfarm payroll employment growing at a rate of 228,600 jobs per month this quarter and 211,200 jobs per month next quarter. The forecasters' projections for the annual-average level of nonfarm payroll employment suggest job gains at a monthly rate of 204,800 in 2014 and 214,000 in 2015, as the table below shows.


Industrial Production increased 0.4%
Capacity Utilization edged up 0.1% to 79.2%

Posted: August 15, 2014 at 09:15 AM (Friday)

Industrial production increased 0.4 percent in July for its sixth consecutive monthly gain. Manufacturing output advanced 1.0 percent in July, its largest increase since February. The production of motor vehicles and parts jumped 10.1 percent, while output in the rest of the manufacturing sector rose 0.4 percent. The production at mines moved up 0.3 percent, its ninth consecutive monthly increase. The output of utilities dropped 3.4 percent, as weather that was milder than usual for July reduced demand for air conditioning. At 104.4 percent of its 2007 average, total industrial production in July was 5.0 percent above its year-earlier level. Capacity utilization for total industry edged up 0.1 percentage point to 79.2 percent in July, a rate 1.7 percentage points above its level of a year earlier and 0.9 percentage point below its long-run (1972–2013) average.


Treasury International Capital Data for June 2014
Posted: August 15, 2014 at 09:00 AM (Friday)

The U.S. Department of the Treasury today released Treasury International Capital (TIC) data for June 2014. The sum total in June of all net foreign acquisitions of long-term securities, short-term U.S. securities, and banking flows was a monthly net TIC outflow of $153.5 billion. Of this, net foreign private outflows were $156.9 billion, and net foreign official inflows were $3.4 billion.

Foreign residents decreased their holdings of long-term U.S. securities in June; net sales were $18.4 billion. Net sales by private foreign investors were $44.6 billion, while net purchases by foreign official institutions were $26.3 billion. U.S. residents increased their holdings of long-term foreign securities, with net purchases of $0.4 billion.

Taking into account transactions in both foreign and U.S. securities, net foreign sales of long-term securities were $18.7 billion. After including adjustments, such as estimates of unrecorded principal payments to foreigners on U.S. asset-backed securities, overall net foreign sales of long-term securities are estimated to have been $30.2 billion in June.

Foreign residents decreased their holdings of U.S. Treasury bills by $15.9 billion. Foreign resident holdings of all dollar-denominated short-term U.S. securities and other custody liabilities decreased by $5.7 billion. Banks’ own net dollar-denominated liabilities to foreign residents decreased by $117.6 billion.


Producer Price Index rose 0.1% in July, ex Fd & Engy up 0.2%
Posted: August 15, 2014 at 08:30 AM (Friday)

The Producer Price Index for final demand rose 0.1 percent in July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This increase followed a 0.4-percent advance in June and a 0.2-percent decline in May. On an unadjusted basis, the index for final demand climbed 1.7 percent for the 12 months ended in July. (See table A.)

In July, the 0.1-percent increase in final demand prices can be traced to the index for final demand services, which also rose 0.1 percent. Prices for final demand goods were unchanged.

Within intermediate demand, prices for processed goods advanced 0.1 percent, the index for unprocessed goods dropped 2.7 percent, and prices for services moved up 0.3 percent.


Empire State Manufacturing Survey Conditions improvement was less widespread
Posted: August 15, 2014 at 08:30 AM (Friday)

The August 2014 Empire State Manufacturing Survey indicates that business conditions continued to improve for New York manufacturers, but the improvement was less widespread than in the previous month. The headline general business conditions index retreated eleven points to 14.7, after reaching a four-year high in July. The new orders index slipped almost five points to 14.1, while the shipments index edged up a point to 24.6—a multiyear high. The unfilled orders index inched down one point to -8.0. The indexes for both prices paid and prices received were up slightly, indicating a marginal pickup in the pace of price increases. Labor market conditions were mixed, with the employment index declining slightly but the index for hours worked rising modestly. Most of the indexes for the six-month outlook rebounded sharply, after slipping in the July survey; a number of them reached multiyear highs, signaling increasingly widespread optimism about the near-term outlook.

General Business Conditions Index Retreats from Four-Year High

Business conditions improved for a fourth consecutive month for New York manufacturers, although the improvement was less widespread than last month’s, according to the August 2014 survey. The general business conditions index retreated eleven points to 14.7, after climbing to a four-year high in July. Thirty-one percent of respondents reported that conditions had improved over the month, while 17 percent reported that they had worsened. The new orders index slipped nearly five points to 14.1, but the shipments index edged up one point to 24.6—its highest level since March 2010. The unfilled orders index eased back to -8.0, pointing to a slow but steady lessening in backlogs. The delivery time index fell five points to -5.7, and the inventories index fell another 11 points to -14.8, pointing to a noteworthy drawdown of inventories.

Mixed News on Employment

Both price indexes edged up this month, suggesting a marginal pickup in the pace of price increases. The prices paid index rose two points to 27.3, and the prices received index inched up one point to 8.0. Labor market conditions were mixed but continued to improve overall. The index for number of employees slipped three points to 13.6, suggesting a slight pullback in the pace of hiring. However, the average workweek index rose six points to 8.0, signaling a slight increase in hours worked.

Increasingly Widespread Optimism

Despite the pullback in most of the survey’s indexes for current conditions, optimism about the near-term outlook grew increasingly widespread. The index for future general business conditions climbed eighteen points to 46.8—its highest level in two-and-a-half years. The future new orders index surged twenty-five points to 50.4, and the future shipments index soared thirty points to 54.5. The index for expected number of employees rose six points to 22.7, and the future average workweek index edged up to zero. The capital expenditures index jumped nine points to 18.2, and the technology spending index inched up to 12.5.


DJ-BTMU U.S. Business Barometer unch%
Posted: August 14, 2014 at 10:00 AM (Thursday)

For the week ending August 2 2014, the DJ-BTMU U.S. Business Barometer remained at 98.7 as positive and negative performances of both consumption and production indexes neutralized each other. MBA’s purchase index dropped by 1.3 percent, but it was entirely offset by gains in chain store sales and railroad freight car loadings. As to the production side, a sharp drop of 4.2 percent in electric output was offset by expansions in other production indexes, especially auto production.

On a year-over-year basis, the barometer showed a gain of 1.3 percent, which compares to an average -3.3 percent decline over the Great Recession (ended in June 2009 according to the NBER). After flat lining in 2006, and declining from 2007 through 2009, the barometer bounced back in 2010 to rise by 3.4 percent, which was the strongest increase since 1994 (+4.0 percent), but not so impressive when compared to an -8.0 percent drop in 2009. The rate of increase for the 2013 slowed to 0.7 percent following 1.5 percent in 2012.

The smoothed version of the barometer, which attempts to account for weekly volatility, remained at 98.7 for three weeks in a row. Its year-over-year growth rate was 1.2 percent.


U.S. Import Price Index declined 0.2% in July
Posted: August 14, 2014 at 08:30 AM (Thursday)

U.S. import prices declined 0.2 percent in July, after increasing each of the 2 previous months, the U.S. Bureau of Labor Statistics reported today. The July decrease was driven by falling fuel prices. Prices for U.S. exports were unchanged in July following a 0.4-percent decrease in June. In July, declining agricultural prices offset higher nonagricultural prices.


Weekly Initial Unemployment Claims Increase 21,000 to 311,000
Posted: August 14, 2014 at 08:30 AM (Thursday)

In the week ending August 9, the advance figure for seasonally adjusted initial claims was 311,000, an increase of 21,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 289,000 to 290,000. The 4-week moving average was 295,750, an increase of 2,000 from the previous week's revised average. The previous week's average was revised up by 250 from 293,500 to 293,750. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.9 percent for the week ending August 2, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending August 2 was 2,544,000, an increase of 25,000 from the previous week's revised level. The previous week's level was revised up 1,000 from 2,518,000 to 2,519,000. The 4-week moving average was 2,528,250, an increase of 9,000 from the previous week's revised average. The previous week's average was revised up by 250 from 2,519,000 to 2,519,250.


Business Inventories up 0.4% in June
Posted: August 13, 2014 at 10:00 AM (Wednesday)

The U.S. Census Bureau announced today that the combined value of distributive trade sales and manufacturers’ shipments for June, adjusted for seasonal and trading-day differences but not for price changes, was estimated at $1,346.7 billion, up 0.3 percent (±0.2%) from May 2014 and were up 4.7 percent (±0.6%) from June 2013.

Manufacturers’ and trade inventories, adjusted for seasonal variations but not for price changes, were estimated at an end-of-month level of $1,743.1 billion, up 0.4 percent (±0.1%) from May 2014 and up 5.8 percent (±0.4%) from June 2013.

The total business inventories/sales ratio based on seasonally adjusted data at the end of June was 1.29. The June 2013 ratio was 1.28.


U.S. Retail Sales for July virtually unch%, Ex-Auto up 0.1%
Posted: August 13, 2014 at 08:30 AM (Wednesday)

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for July, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $439.8 billion, virtually unchanged (±0.5) from the previous month, and 3.7 percent (±0.9) above July 2013. Total sales for the May through July 2014 period were up 4.2 percent (±0.7) from the same period a year ago. The May to June 2014 percent change was unrevised from +0.2 percent (±0.2).

Retail trade sales were virtually unchanged (±0.5) from June 2014, and 3.4 percent (±0.7) above last year. Health and personal care stores were up 7.3 percent (±1.9) from July 2013 and auto and other motor vehicle dealers were up 6.4 percent (±3.2) from last year.


Purchase Apps down, Refi's down in Latest MBA Weekly Survey
Posted: August 13, 2014 at 07:00 AM (Wednesday)

Mortgage applications decreased 2.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 8, 2014.

The Market Composite Index, a measure of mortgage loan application volume, decreased 2.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 3 percent compared with the previous week. The Refinance Index decreased 4 percent from the previous week to the lowest level since May 2014. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier to the lowest level since February 2014. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 10 percent lower than the same week one year ago. The seasonally adjusted Government Purchase Index fell by 1 percent to the lowest level since 2007.

The refinance share of mortgage activity decreased to 54 percent of total applications from 55 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 8 percent of total applications.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) remained unchanged at 4.35 percent, with points unchanged at 0.22 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) decreased to 4.24 percent from 4.26 percent, with points decreasing to 0.19 from 0.35 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 4.04 percent from 4.06 percent, with points increasing to 0.03 from 0.02 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.48 percent from 3.51 percent, with points increasing to 0.30 from 0.28 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to 3.24 percent from 3.32 percent, with points increasing to 0.45 from 0.35 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.


Job Openings were 4.7 million in June
Posted: August 12, 2014 at 10:00 AM (Tuesday)

There were 4.7 million job openings on the last business day of June, little changed from 4.6 million in May, the U.S. Bureau of Labor Statistics reported today. The hires rate (3.5 percent) was little changed and the separations rate (3.3 percent) was unchanged in June. Within separations, the quits rate (1.8 percent) and the layoffs and discharges rate (1.2 percent) were unchanged. This release includes estimates of the number and rate of job openings, hires, and separations for the nonfarm sector by industry and by four geographic regions.

There were 4.7 million job openings in June, little changed from 4.6 million in May. In June, the number of job openings was little changed for total private and government. Over the month, the number of job openings was little changed for all industries and in all four regions.

Over the last 12 months, the movement of job openings has varied. From June 2013 to January 2014, the number of job openings was little changed, decreasing by 97,000. However, from January 2014 through June 2014, the number of job openings trended upward by an average 159,000 job openings per month, for a total increase of 797,000 openings.


ICSC Chain Store Sales decreased by 1.4% in Aug 9 Wk
Posted: August 12, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 3.2% for the week ending August 9 - relative to the prior year. On a weekly basis, sales decreased 1.4% compared to the previous week.

"Business was a bit more mixed this past week, with electronic stores leading the way from a performance standpoint," said Michael Niemira, ICSC research consultant. "The good news is that consumers are continuing to get a break at the pump, which will free up their ability to spend on back-to-school purchases. I expect sales for August to show a healthy gain of 4% to 5% - a notable improvement over the 3.6% gain in August 2013," he added.


NFIB Small Business Optimism Index rose 0.7 points to 95.7
Posted: August 12, 2014 at 07:30 AM (Tuesday)

The Index of Small Business Optimism rose 0.7 points in July to 95.7, not a “4 percent” GDP month for sure. There was little change in the 10 Index components other than outlook for expansion and business conditions which accounted for the small gain in the Index. Even though these improved, they remain historically low.

Job growth was anemic in July with 209,000 as a first guess by the BLS. But the media rejoiced calling it “not too hot, not too cold”, just right for the Federal Reserve and the stock market. Really? Well, financial markets don’t want a hot economy because interest rates will rise causing asset values fall. But the unemployment rate went up, not down although some excuse this as typical in a recovery when more re-enter the labor force. Total hours worked by all these workers barely increased. The Index of Total hours rose from 100.8 to 101.0, 2007=100. So, the total number of hours worked is virtually the same as in 2007, seven years later and after five years of “expansion”. Gains in part-time employment, offset by losses of full-time workers is not a good model for economic growth.

Clearly the stats are not acceptable to the Board of Governors, which recently reasserted the view that significant “accommodation” was still needed, this in spite of the volumes of empirical results that suggest that even historically low rates of interest aren’t enough to move the employment needle much if at all.

The denominator in the valuation model is as low as it can be. But it’s the numerator, expected profits and cash flow that is being crippled by current policies and high levels of uncertainty. A third of the owners who view the current period as a bad time to expand blame the political environment.

Year over year, GDP growth is running about 2.5 percent, been here, done that for too long now. Looking at the NFIB survey results for July, there is no evidence that economic activity is picking up in early Q3. Only job creation plans and job openings have reached growth levels from a historical perspective. But the actual reported job creation, though positive, is not strong. And capital spending and inventory investment both remain weak. Unfortunately, Q3 looks like more of the same.


Wholesale Inventories up 0.3% in June
Posted: August 8, 2014 at 10:00 AM (Friday)

The U.S. Census Bureau announced today that June 2014 sales of merchant wholesalers, except manufacturers’ sales branches and offices, after adjustment for seasonal variations and trading-day differences but not for price changes, were $454.4 billion, up 0.2 percent (+/-0.7)* from the revised May level and were up 6.5 percent (+/-1.8%) from the June 2013 level. The May preliminary estimate was revised upward $0.2 billion. June sales of durable goods were up 1.4 percent (+/-0.9%) from last month and were up 6.6 percent (+/-1.2%) from a year ago. Sales of nondurable goods were down 0.7 percent (+/-0.7%)* from May, but were up 6.5 percent (+/-3.2%) from last June. Sales of farm product raw materials were down 8.1 percent from last month.

Total inventories of merchant wholesalers, except manufacturers’ sales branches and offices, after adjustment for seasonal variations but not for price changes, were $533.5 billion at the end of June, up 0.3 percent (+/-0.4%)* from the revised May level and were up 7.9 percent (+/-0.9%) from the June 2013 level. The May preliminary estimate was revised downward $0.9 billion or 0.2 percent. June inventories of durable goods were up 0.7 percent (+/-0.4%) from last month and were up 8.8 percent (+/-1.2%) from a year ago. Inventories of metals and minerals, except petroleum, were up 3.2 percent from last month and inventories of computer and computer peripheral equipment and software were up 1.8 percent. Inventories of nondurable goods were down 0.2 percent (+/-0.5%)* from May, but were up 6.4 percent (+/-1.1%) from last June. Inventories of farm product raw materials were down 5.3 percent from last month, while inventories of chemicals and allied products were up 2.6 percent.

The June inventories/sales ratio for merchant wholesalers, except manufacturers’ sales branches and offices, based on seasonally adjusted data, was 1.17. The June 2013 ratio was 1.16.


2Q2014 Productivity Growth Increased 2.5%
Posted: August 8, 2014 at 08:30 AM (Friday)

Nonfarm business sector labor productivity increased at a 2.5 percent annual rate during the second quarter of 2014, the U.S. Bureau of Labor Statistics reported today, as hours increased 2.7 percent and output increased 5.2 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the second quarter of 2013 to the second quarter of 2014, productivity increased 1.2 percent as output and hours worked rose 3.2 percent and 2.0 percent, respectively.

Labor productivity, or output per hour, is calculated by dividing an index of real output by an index of hours worked of all persons, including employees, proprietors, and unpaid family workers.

In the first quarter of 2014, nonfarm business productivity decreased 4.5 percent--rather than falling 3.2 percent as reported June 4--reflecting a downward revision to output which was larger than a small downward revision to hours.


Consumer Credit Increased at an annual rate of 7.75%
Posted: August 7, 2014 at 03:00 PM (Thursday)

Consumer credit increased at a seasonally adjusted annual rate of 7-3/4 percent during the second quarter. Revolving credit increased at an annual rate of 5-1/2 percent, while nonrevolving credit increased at an annual rate of 8-3/4 percent. In June, consumer credit increased at an annual rate of 6-1/2 percent.


DJ-BTMU U.S. Business Barometer bounced back by 0.2%
Posted: August 7, 2014 at 10:00 AM (Thursday)

For the week ending July 26 2014, the DJ-BTMU U.S. Business Barometer bounced back by 0.2 percent to 98.7, after declining for two consecutive weeks. The recovery in this week’s barometer is largely driven by production indexes, in which truck production and electric output picked up by 11.5 and 6.3 percent, respectively, more than offsetting the 8.1 percent drop in auto production. As to the consumption side, chain store sales and MBA’s purchase index reported minor gains.

On a year-over-year basis, the barometer showed a gain of 1.2 percent, which compares to an average -3.3 percent decline over the Great Recession (ended in June 2009 according to the NBER). After flat lining in 2006, and declining from 2007 through 2009, the barometer bounced back in 2010 to rise by 3.4 percent, which was the strongest increase since 1994 (+4.0 percent), but not so impressive when compared to an -8.0 percent drop in 2009. The rate of increase for the 2013 slowed to 0.7 percent following 1.5 percent in 2012.

The smoothed version of the barometer, which attempts to account for weekly volatility, remained at 98.7 for two weeks in a row. Its year-over-year growth rate was 1.1 percent.


Weekly Initial Unemployment Claims Decrease 14,000 to 289,000
Posted: August 7, 2014 at 08:30 AM (Thursday)

In the week ending August 2, the advance figure for seasonally adjusted initial claims was 289,000, a decrease of 14,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 302,000 to 303,000. The 4 - week moving average was 293,500, a decrease of 4,000 from the previous week's revised average. This is the lowest level for this average since February 25, 2006 when it was 290,750. The previous week's average was revised up by 250 from 297,250 to 297,500.

There were no special factors impacting this week's initial claims. The advance seasonally adjusted insured unemployment rate was 1.9 percent for the week ending July 26, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending July 26 was 2,518,000, a decrease of 24,000 from the previous week's revised level. The previous week's level was revised up 3,000 from 2,539,000 to 2,542,000. The 4 - week moving average was 2,519,000, a decrease of 17,000 from the previous week's revised average. This is the lowest level for this average since July 7, 2007 when it was 2,509,250. The previous week's average was revised up by 750 from 2,535,250 to 2,536,000.


Goods and Services Deficit Decreased in June 2014
Posted: August 6, 2014 at 08:30 AM (Wednesday)

The Nation’s international trade deficit in goods and services decreased to $41.5 billion in June from $44.7 billion in May (revised), as exports increased and imports decreased.

The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that total June exports of $195.9 billion and imports of $237.4 billion resulted in a goods and services deficit of $41.5 billion, down from $44.7 billion in May, revised. June exports were $0.3 billion more than May exports of $195.6 billion. June imports were $2.9 billion less than May imports of $240.3 billion.

In June, the goods deficit decreased $3.0 billion from May to $60.3 billion, and the services surplus increased $0.1 billion from May to $18.7 billion. Exports of goods increased $0.1 billion to $136.9 billion, and imports of goods decreased $2.9 billion to $197.2 billion. Exports of services increased $0.1 billion to $59.0 billion, and imports of services were virtually unchanged at $40.2 billion.

The goods and services deficit increased $5.0 billion from June 2013 to June 2014. Exports were up $5.5 billion, or 2.9 percent, and imports were up $10.5 billion, or 4.6 percent.


Purchase Apps up, Refi's up in Latest MBA Weekly Survey
Posted: August 6, 2014 at 07:00 AM (Wednesday)

Mortgage applications increased 1.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 1, 2014.

The Market Composite Index, a measure of mortgage loan application volume, increased 1.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 1 percent compared with the previous week. The Refinance Index increased 4 percent from the previous week. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 14 percent lower than the same week one year ago.

The refinance share of mortgage activity increased to 55 percent of total applications, the highest level since March 2014, from 53 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 8 percent of total applications.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.35 percent from 4.33 percent, with points decreasing to 0.22 from 0.24 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) increased to 4.26 percent from 4.22 percent, with points increasing to 0.35 from 0.23 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 4.06 percent from 4.03 percent, with points increasing to 0.02 from 0.00 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.51 percent from 3.47 percent, with points increasing to 0.28 from 0.25 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs increased to 3.32 percent from 3.31 percent, with points decreasing to 0.35 from 0.40 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.


ISM Non-Manufacturing Index grew at 58.7%
Posted: August 5, 2014 at 10:00 AM (Tuesday)

Economic activity in the non-manufacturing sector grew in July for the 54th consecutive month, say the nation's purchasing and supply executives in the latest Non-Manufacturing ISM® Report On Business®.

The NMI® registered 58.7 percent in July, 2.7 percentage points higher than the June reading of 56 percent. This represents continued growth in the Non-Manufacturing sector. This month's NMI® is the highest reading for the index since its inception in January 2008. The Non-Manufacturing Business Activity Index increased to 62.4 percent, which is 4.9 percentage points higher than the June reading of 57.5 percent, reflecting growth for the 60th consecutive month at a faster rate. This is the highest reading for the index since February 2011 when the index registered 63.3 percent. The New Orders Index registered 64.9 percent, 3.7 percentage points higher than the reading of 61.2 percent registered in June. This represents the highest reading for the New Orders Index since August 2005 when it registered 65.3 percent. The Employment Index increased 1.6 percentage points to 56 percent from the June reading of 54.4 percent and indicates growth for the fifth consecutive month. The Prices Index decreased 0.3 percentage point from the June reading of 61.2 percent to 60.9 percent, indicating prices increased at a slightly slower rate in July when compared to June. According to the NMI®, 16 non-manufacturing industries reported growth in July. Respondents' comments indicate that stabilization and/or improving market conditions have positively affected the majority of the respective industries and businesses."

INDUSTRY PERFORMANCE

The 16 non-manufacturing industries reporting growth in July — listed in order — are: Construction; Educational Services; Public Administration; Real Estate, Rental & Leasing; Arts, Entertainment & Recreation; Retail Trade; Accommodation & Food Services; Professional, Scientific & Technical Services; Management of Companies & Support Services; Finance & Insurance; Mining; Wholesale Trade; Health Care & Social Assistance; Transportation & Warehousing; Information; and Other Services. The only industry reporting contraction in July is Utilities.


New orders for manufactured goods increased 1.1%
Posted: August 5, 2014 at 10:00 AM (Tuesday)

New orders for manufactured goods in June, up four of the last five months, increased $5.7 billion or 1.1 percent to $503.2 billion, the U.S. Census Bureau reported today. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.6 percent May decrease. Excluding transportation, new orders increased 1.1 percent.

Shipments, up four of the last five months, increased $2.5 billion or 0.5 percent to $499.8 billion. This was also at the highest level since the series was first published on a NAICS basis and followed a 0.1 percent May decrease.

Unfilled orders, up fourteen of the last fifteen months, increased $10.4 billion or 1.0 percent to $1,098.5 billion. This was also at the highest level since the series was first published on a NAICS basis and followed a 0.7 percent May increase. The unfilled orders-to-shipments ratio was 6.52, unchanged from May.

Inventories, up nineteen of the last twenty months, increased $1.8 billion or 0.3 percent to $653.8 billion. This was also at the highest level since the series was first published on a NAICS basis and followed a 0.8 percent May increase. The inventories-to-shipments ratio was 1.31, unchanged from May.


ICSC Chain Store Sales increased by 0.2% in Aug 2 Wk
Posted: August 5, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 0.2% for the week ending August 2 - relative to its prior week. On a year-over-year basis, sales accelerated rapidly by 4.5% compared to the same week of the prior year.

"The fiscal month sustained a strong pace of 4.1% overall," noted Michael Niemira, ICSC research consultant. "There were 12 states that had a sales tax holiday during the week, which helped propel back-to-school sales. As a result, I expect sales for July to increase by better than 4%," he added.


Employment Trends Index increased in July to 120.31
Posted: August 4, 2014 at 10:00 AM (Monday)

The Conference Board Employment Trends Index™ (ETI) increased in July. The index now stands at 120.31, up from 119.92 (an upward revision) in June. This represents a 6.6 percent gain in the ETI compared to a year ago.

The six-month growth rate in the Employment Trends Index is the strongest in over two years, suggesting solid job growth is likely to continue in the coming months. The pickup in economic activity in recent months will likely increase the need and willingness of employers to accelerate hiring.

July’s increase in the ETI was driven by positive contributions from five of its eight components. In order from the largest positive contributor to the smallest, these were: Initial Claims for Unemployment Insurance, Job Openings, Industrial Production, Number of Temporary Employees, and Real Manufacturing and Trade Sales.


New York Purchasing Managers Business Activity jumped to 68.1 in July
Posted: August 4, 2014 at 08:30 AM (Monday)

New York City business activity expanded at the fastest pace in eight months, according to the survey taken by the Institute for Supply Management-New York (ISM-NY).

Current Business Conditions were 68.1 in July, the highest level since November 2013. Future optimism rose to a five-month high. The Six-Month Outlook came in at 70.7 in July.

Job growth accelerated to the best reading in five months. Employment improved to 59.5 in July.

Purchase volume expanded at a more moderate pace than last month. Quantity of Purchases eased to 54.8 in July. Prices Paid increased at the fastest rate in four months, at 64.3 in July.

We introduce the Prices Received index with this Report, a measure of selling prices by regional firms. Prices Received was stuck in neutral at 50.0 in July for a second straight month.

The top line and forward guidance both eased versus last month. Current Revenues were 61.8 in July, and Expected Revenues were 72.2 in July.

Potential Business Opportunities/Impediments: Both parts of labor compensation – cost of benefits and cost of labor – topped the table for impediments, with regulations and inflation also tied for second. The strongest opportunities came from management skills, domestic demand, foreign demand and skilled labor.


University of Michigan Consumer Confidence dipped in July to 81.8
Posted: August 1, 2014 at 10:08 AM (Friday)

More rapid job creation, higher wages, and gains in household wealth have eased the financial strains on households as well as supported more favorable buying plans for vehicles and household durables. While consumers considered their current financial situation to now be in the best shape since the start of the Great Recession, those gains have not caused consumers to confidently expect a continuation of robust growth in the year ahead. Nonetheless, confidence is sufficiently high to expand consumption by an annual rate of 2.5% in 2014.

Current Finances Improve
When consumers were asked to explain in their own words how their financial situation had changed, one in three households mentioned that their income had recently increased. While more work meant higher incomes, the gains were also due to higher wages. This was the most positive assessment of current income trends since the May 2007 survey. Complaints about higher prices, however, also rose, cited by one-in-five households in July. Unfortunately, the recent gains did not prompt more consumers to expect higher income gains in the year ahead. Just over one-in-four anticipated being better off financially, with half expecting no income gain at all.

Housing Market Slows
The slowdown in home price appreciation and uptick in inflation has had a significant impact on home sales. The median annual increase in home values expected by homeowners was just 0.4% in the July survey, well below the expected inflation rate. Although a resurgent housing market has been an important factor for recoveries in the past, investments in homes are no longer expected to post strong inflation-adjusted gains. This leaves housing demand more vulnerable to even small changes in the pace of home appreciation and the inflation rate.

Consumer Sentiment Index
The Sentiment Index was 81.8 in the July 2014 survey, slightly below the 82.5 in June and the 85.1 recorded last July. During the first half of 2014, the Sentiment Index remained remarkably stable, averaging 81.9, with the July figure nearly identical to that average. Current Conditions Index was 97.4, up from June’s 96.6, while the Expectations Index slid to 71.8 from 73.5 in June and 76.5 last July.

Despite the recent gains in jobs and wages, consumers have yet to interpret these gains as an indication that more robust growth in jobs and wages will be forthcoming in the future. The slow and uneven pace of the recovery in jobs and incomes during the past five years has made consumers unwilling to put much stock in favorable economic forecasts until repeatedly confirmed by positive realizations. What may have been termed a skeptical viewpoint in an earlier era, is now regarded as a more practical “show-me” state of mind. This show-me attitude is particularly strong among moderate income families and middle aged householders.


Construction Spending decreased 1.8% in June
Posted: August 1, 2014 at 10:00 AM (Friday)

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during June 2014 was estimated at a seasonally adjusted annual rate of $950.2 billion, 1.8 percent (±1.8%) below the revised May estimate of $967.8 billion. The June figure is 5.5 percent (±2.3%) above the June 2013 estimate of $900.3 billion. During the first 6 months of this year, construction spending amounted to $445.1 billion, 7.8 percent (±1.6%) above the $413.0 billion for the same period in 2013.

PRIVATE CONSTRUCTION
Spending on private construction was at a seasonally adjusted annual rate of $685.5 billion, 1.0 percent (±1.0%) below the revised May estimate of $692.0 billion. Residential construction was at a seasonally adjusted annual rate of $355.9 billion in June, 0.3 percent (±1.3%) below the revised May estimate of $357.0 billion. Nonresidential construction was at a seasonally adjusted annual rate of $329.5 billion in June, 1.6 percent (±1.0%) below the revised May estimate of $335.0 billion.

PUBLIC CONSTRUCTION
In June, the estimated seasonally adjusted annual rate of public construction spending was $264.7 billion, 4.0 percent (±3.0%) below the revised May estimate of $275.7 billion. Educational construction was at a seasonally adjusted annual rate of $59.7 billion, 4.9 percent (±5.6%) below the revised May estimate of $62.8 billion. Highway construction was at a seasonally adjusted annual rate of $75.3 billion, 10.4 percent (±7.4%) below the revised May estimate of $84.0 billion.


July Manufacturing ISM expanded at 57.1
Posted: August 1, 2014 at 10:00 AM (Friday)

Economic activity in the manufacturing sector expanded in July for the 14th consecutive month, and the overall economy grew for the 62nd consecutive month, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®.

The July PMI® registered 57.1 percent, an increase of 1.8 percentage points from June's reading of 55.3 percent, indicating expansion in manufacturing for the 14th consecutive month. The New Orders Index registered 63.4 percent, an increase of 4.5 percentage points from the 58.9 percent reading in June, indicating growth in new orders for the 14th consecutive month. The Production Index registered 61.2 percent, 1.2 percentage points above the June reading of 60 percent. Employment grew for the 13th consecutive month, registering 58.2 percent, an increase of 5.4 percentage points over the June reading of 52.8 percent. Inventories of raw materials registered 48.5 percent, a decrease of 4.5 percentage points from the June reading of 53 percent, contracting after five months of consecutive growth. Comments from the panel are generally positive, while some indicate concern over global geopolitical situations."

Of the 18 manufacturing industries, 17 are reporting growth in July in the following order: Furniture & Related Products; Textile Mills; Apparel, Leather & Allied Products; Printing & Related Support Activities; Plastics & Rubber Products; Paper Products; Nonmetallic Mineral Products; Food, Beverage & Tobacco Products; Machinery; Chemical Products; Miscellaneous Manufacturing; Fabricated Metal Products; Electrical Equipment, Appliances & Components; Petroleum & Coal Products; Primary Metals; Transportation Equipment; and Computer & Electronic Products. The only industry reporting contraction in July is Wood Products.


July Employment increased by 209,000
Unemployment Rate ticked up to 6.2%

Posted: August 1, 2014 at 08:30 AM (Friday)

Total nonfarm payroll employment increased by 209,000 in July, and the unemployment rate was little changed at 6.2 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in professional and business services, manufacturing, retail trade, and construction.

Both the unemployment rate (6.2 percent) and the number of unemployed persons (9.7 million) changed little in July. Over the past 12 months, the unemployment rate and the number of unemployed persons have declined by 1.1 percentage points and 1.7 million, respectively.

Among the major worker groups, the unemployment rate for adult women increased to 5.7 percent and the rate for blacks edged up to 11.4 percent in July, following declines for both groups in the prior month. The rates for adult men (5.7 percent), teenagers (20.2 percent), whites (5.3 percent), and Hispanics (7.8 percent) showed little or no change in July. The jobless rate for Asians was 4.5 percent (not seasonally adjusted), little changed from a year earlier.

The number of long-term unemployed (those jobless for 27 weeks or more) was essentially unchanged at 3.2 million in July. These individuals accounted for 32.9 percent of the unemployed. Over the past 12 months, the number of long-term unemployed has declined by 1.1 million.

The civilian labor force participation rate, at 62.9 percent, changed little in July. The participation rate has been essentially unchanged since April. The employment-population ratio, at 59.0 percent, was unchanged over the month but has edged up by 0.3 percentage point over the past 12 months.

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers), at 7.5 million, was unchanged in July. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.

In July, 2.2 million persons were marginally attached to the labor force, down by 236,000 from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

Among the marginally attached, there were 741,000 discouraged workers in July, down by 247,000 from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.4 million persons marginally attached to the labor force in July had not searched for work for reasons such as school attendance or family responsibilities.

Total nonfarm payroll employment increased by 209,000 in July, the same as its average monthly gain over the prior 12 months. In July, employment grew in professional and business services, manufacturing, retail trade, and construction.

In July, the average workweek for all employees on private nonfarm payrolls was 34.5 hours for the fifth straight month. The manufacturing workweek decreased by 0.2 hour in July to 40.9 hours, and factory overtime edged down by 0.1 hour to 3.4 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls was 33.7 hours for the fifth consecutive month.

In July, average hourly earnings for all employees on private nonfarm payrolls edged up by 1 cent to $24.45. Over the past 12 months, average hourly earnings have risen by 2.0 percent. In July, average hourly earnings of private-sector production and nonsupervisory employees increased by 4 cents to $20.61.

The change in total nonfarm payroll employment for May was revised from +224,000 to +229,000, and the change for June was revised from +288,000 to +298,000. With these revisions, employment gains in May and June were 15,000 higher than previously reported.


Personal Income increased 0.4%, Spending increased 0.3%
Posted: August 1, 2014 at 08:30 AM (Friday)

Personal income increased $56.7 billion, or 0.4 percent, and disposable personal income (DPI) increased $51.5 billion, or 0.4 percent, in June, according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) increased $51.7 billion, or 0.4 percent. In May, personal income increased $57.4 billion, or 0.4 percent, DPI increased $55.0 billion, or 0.4 percent, and PCE increased $39.8 billion, or 0.3 percent, based on revised estimates.

Real DPI increased 0.2 percent in June, the same increase as in May. Real PCE increased 0.2 percent in June, compared with an increase of 0.1 percent in May.


DJ-BTMU U.S. Business Barometer declined by 0.3%
Posted: July 31, 2014 at 10:00 AM (Thursday)

For the week ending July 19 2014, the DJ-BTMU U.S. Business Barometer declined by 0.3 percent to 98.5, extending the weakening trend to two weeks. The decrease in this week’s barometer is mainly driven by production indexes, in which electric output plummeted by a sharp 10.2 percent as well as truck production (-4.3 percent). As to the consumption side, chain store sales dropped by 0.4 percent, although it was partially cancelled out by minor gains in MBA’s purchase index and railroad freight car loadings.

On a year-over-year basis, the barometer showed a gain of 0.4 percent, which compares to an average -3.3 percent decline over the Great Recession (ended in June 2009 according to the NBER). After flat lining in 2006, and declining from 2007 through 2009, the barometer bounced back in 2010 to rise by 3.4 percent, which was the strongest increase since 1994 (+4.0 percent), but not so impressive when compared to an -8.0 percent drop in 2009. The rate of increase for the 2013 slowed to 0.7 percent following 1.5 percent in 2012.

The smoothed version of the barometer, which attempts to account for weekly volatility, fell by a modest 0.1 percent. Its year-over-year growth rate dropped to 0.9 percent.


Chicago Purchasing Managers Index dropped 10.0 points to 52.6 in July
Posted: July 31, 2014 at 09:45 AM (Thursday)

The Chicago Business Barometer dropped 10.0 points to 52.6 in July, significantly down from May’s seven month high of 65.5, led by a collapse in Production and the ordering components, all of which have been strong since last fall.

A monthly fall of this magnitude has not been seen since October 2008 and left the Barometer at its lowest level since June 2013.

In spite of the sharp decline this month, feedback from purchasing managers was that they saw the downturn as a lull rather than the start of a new downward trend. This was especially so given the recent strong performance and the fact that Employment managed to increase further in July. Nonetheless, following a strong Q2, this was clearly a poor start to Q3 and as such tempers some of the increased optimism in recent months.

Production’s large decline in July left the indicator barely in expansionary territory and at a two year low, although this followed a very strong run with output above 70 in June. New Orders, the most heavily weighted component of the barometer, saw its biggest monthly set back since November 2013.

Order Backlogs, which have expanded in every month since last October, fell into contraction in July.

The rise in the Employment component in July appeared to be somewhat of an anomaly, although one reading of it suggests that panellists expect the lull in output and orders to prove temporary.

Growth in inventories eased in July from a seven month high in June, while Prices Paid fell for the second consecutive month but remained well above 50.

Commenting on the MNI Chicago Report, Philip Uglow, Chief Economist at MNI Indicators said, “The surprise fall in the Chicago Business Barometer in July, following a strong second quarter, naturally raises questions about the sustainability of the recovery. Some feedback from panellists points to this being a temporary setback, although we’ll need to see the August data to judge to what extent this is a blip“.


Weekly Initial Unemployment Claims Increase 23,000 to 302,000
Posted: July 31, 2014 at 08:30 AM (Thursday)

In the week ending July 26, the advance figure for seasonally adjusted initial claims was 302,000, an increase of 23,000 from the previous week's revised level. The previous week's level was revised down by 5,000 from 284,000 to 279,000. The 4-week moving average was 297,250, a decrease of 3,500 from the previous week's revised average. This is the lowest level for this average since April 15, 2006 when it was 296,000. The previous week's average was revised down by 1,250 from 302,000 to 300,750.

There were no special factors impacting this week's initial claims. The advance seasonally adjusted insured unemployment rate was 1.9 percent for the week ending July 19, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending July 19 was 2,539,000, an increase of 31,000 from the previous week's revised level. The previous week's level was revised up 8,000 from 2,500,000 to 2,508,000. The 4-week moving average was 2,535,250, a decrease of 9,000 from the previous week's revised average. This is the lowest level for this average since October 13, 2007 when it was 2,527,500. The previous week's average was revised up by 2,000 from 2,542,250 to 2,544,250.


Employment Cost Index up 0.7% in 2Q2014
Posted: July 31, 2014 at 08:30 AM (Thursday)

Compensation costs for civilian workers increased 0.7 percent, seasonally adjusted, for the 3-month period ending June 2014, the U.S. Bureau of Labor Statistics reported today. Wages and salaries (which make up about 70 percent of compensation costs) increased 0.6 percent, and benefits (which make up the remaining 30 percent of compensation) increased 1.0 percent.


Challenger Layoffs jumped 49% in July
Posted: July 31, 2014 at 07:30 AM (Thursday)

The unexpectedly large layoffs announced by Microsoft helped push July job cuts to the second highest level of the year. In all, U.S.-based employers reported plans to reduce payrolls by 46,887 during the month, according to the report released Thursday by global outplacement consultancy Challenger, Gray & Christmas, Inc.

The July total was up 49 percent from June’s 31,434 job cuts, which was the fewest number of cuts announced, year to date. It was 24 percent higher than the 37,701 cuts recorded in July 2013. The only month to see more job cuts so far this year was May, when job cuts reached 52,961. Employers have announced 292,921 job cuts, to date. That is 1.3 percent fewer than the 296,633 job cuts announced in the first seven months of 2013.

July job-cut news was dominated by Microsoft, which announced plans to reduce its workforce by as many as 18,000. That is the largest downsizing in the company’s history. It is also the largest layoff announcement this year, surpassing fellow tech giant Hewlett-Packard’s announced plans to shed as many as 16,000 workers from its payroll.

The combined cuts by H-P and Microsoft have helped make the computer industry the leading job-cut sector through July. Computer firms announced a total of 48,361 job cuts in the first seven months of 2014, 125 percent more than the 21,517 recorded during the same period a year ago.

A large portion of the Microsoft job cuts were related to its acquisition of Nokia in 2013. However, like Hewlett-Packard, the tech giant is attempting to streamline in order to become more nimble and competitive in an industry that is constantly changing. Both companies were slow to react to the shift from PCs to mobile and simply do not want to get caught flat-footed again. In order to do that, both companies had to flatten the bureaucracy and foster a more entrepreneurial approach to decision making.

The 48,361 job cuts announced by computer firms this year is 85 percent more than the second-ranked retail industry, which has announced 29,046 job cuts this year, including 2,183 in July. The year-to-date retail total is down 16 percent from a year ago (34,694).

The large job cuts in the computer industry are certainly not a sign of a stalling economy. The fact is, these are companies that are trying to adjust to where the growth is occurring. The economy is on an upward trajectory, as evidenced by the fact that 18 of the 28 industries we track have seen job cuts decline this year. Even among those with increased job cuts, the year-to-date totals are relatively low by historical standards.

As layoffs continue to decline, along with unemployment rates, perhaps the biggest threat to economic growth going forward is the shortage of skilled workers. Some industries and some regions of the country are already experiencing labor shortages. Houston, for example, has flourished thanks to a resurgence in the energy markets, but worries over a shrinking talent pool has area businesses partnering with junior colleges, high schools and social service agencies to prepare workers for the skilled trade jobs being created by the thousands.

In Detroit, demand for accountants is leading to increased salaries, referral and signing bonuses, and generous perks. Candidates are being wined and dined and taken to sporting events by senior partners in the big accounting firms, according to a recent article in Crain’s Detroit Business.

Granted, there are still several major metropolitan areas still struggling with high unemployment, but jobless rates are falling around the country and barring any shock to the economy over the next five to 10 years, labor shortages are likely to spread.


FOMC target funds rate still 0 - 1/4%, QE now $25 bil
Posted: July 30, 2014 at 02:00 PM (Wednesday)

Information received since the Federal Open Market Committee met in June indicates that growth in economic activity rebounded in the second quarter. Labor market conditions improved, with the unemployment rate declining further. However, a range of labor market indicators suggests that there remains significant underutilization of labor resources. Household spending appears to be rising moderately and business fixed investment is advancing, while the recovery in the housing sector remains slow. Fiscal policy is restraining economic growth, although the extent of restraint is diminishing. Inflation has moved somewhat closer to the Committee's longer-run objective. Longer-term inflation expectations have remained stable.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators and inflation moving toward levels the Committee judges consistent with its dual mandate. The Committee sees the risks to the outlook for economic activity and the labor market as nearly balanced and judges that the likelihood of inflation running persistently below 2 percent has diminished somewhat.

The Committee currently judges that there is sufficient underlying strength in the broader economy to support ongoing improvement in labor market conditions. In light of the cumulative progress toward maximum employment and the improvement in the outlook for labor market conditions since the inception of the current asset purchase program, the Committee decided to make a further measured reduction in the pace of its asset purchases. Beginning in August, the Committee will add to its holdings of agency mortgage-backed securities at a pace of $10 billion per month rather than $15 billion per month, and will add to its holdings of longer-term Treasury securities at a pace of $15 billion per month rather than $20 billion per month. The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. The Committee's sizable and still-increasing holdings of longer-term securities should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative, which in turn should promote a stronger economic recovery and help to ensure that inflation, over time, is at the rate most consistent with the Committee's dual mandate.

The Committee will closely monitor incoming information on economic and financial developments in coming months and will continue its purchases of Treasury and agency mortgage-backed securities, and employ its other policy tools as appropriate, until the outlook for the labor market has improved substantially in a context of price stability. If incoming information broadly supports the Committee's expectation of ongoing improvement in labor market conditions and inflation moving back toward its longer-run objective, the Committee will likely reduce the pace of asset purchases in further measured steps at future meetings. However, asset purchases are not on a preset course, and the Committee's decisions about their pace will remain contingent on the Committee's outlook for the labor market and inflation as well as its assessment of the likely efficacy and costs of such purchases.

To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that a highly accommodative stance of monetary policy remains appropriate. In determining how long to maintain the current 0 to 1/4 percent target range for the federal funds rate, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments. The Committee continues to anticipate, based on its assessment of these factors, that it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends, especially if projected inflation continues to run below the Committee's 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored.

When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent. The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run.

Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; Lael Brainard; Stanley Fischer; Richard W. Fisher; Narayana Kocherlakota; Loretta J. Mester; Jerome H. Powell; and Daniel K. Tarullo. Voting against was Charles I. Plosser who objected to the guidance indicating that it likely will be appropriate to maintain the current target range for the federal funds rate for "a considerable time after the asset purchase program ends," because such language is time dependent and does not reflect the considerable economic progress that has been made toward the Committee's goals.


Help Wanted OnLine Labor Demand dropped 15,500 in July
Posted: July 30, 2014 at 10:00 AM (Wednesday)

Online advertised vacancies showed a small drop of 15,500 to 5,044,600 in July, according to The Conference Board Help Wanted OnLine® (HWOL) Data Series, released today. The June Supply/Demand rate stands at 1.9 unemployed for each advertised vacancy with a total of 4.4 million more unemployed workers than the number of advertised vacancies. The number of unemployed was 9.5 million in June.

Labor demand continues to be at historically high levels with employer demand running at about 5 million ads each month. While the average monthly increases have become more modest since early 2013, the overall trend has helped lower unemployment levels and reduced the U.S. Supply/Demand rate from a peak of 5.2 in June 2009 to 1.9 in June 2014.

In July, professional occupations showed a small gain in Computer and Math (13,400) and Community and Social Services (3,500) but a drop in Healthcare (-8,300). The Services/Production occupations showed losses with Office and Administration (-15,700) and Installation and Repair (-9,600).


2Q2014 GDP advance estimate increased 4.0%
Posted: July 30, 2014 at 08:30 AM (Wednesday)

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 4.0 percent in the second quarter of 2014, according to the "advance" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP decreased 2.1 percent (revised).

The Bureau emphasized that the second-quarter advance estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see the box on page 3 and "Comparisons of Revisions to GDP" on page 10). The "second" estimate for the second quarter, based on more complete data, will be released on August 28, 2014.

The increase in real GDP in the second quarter primarily reflected positive contributions from personal consumption expenditures (PCE), private inventory investment, exports, nonresidential fixed investment, state and local government spending, and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.

For the first quarter of 2014, real GDP is now estimated to have declined 2.1 percent; in the previously published estimates, first-quarter GDP was estimated to have declined 2.9 percent. The 0.8 percentage point upward revision to the percent change in first-quarter real GDP primarily reflected upward revisions to private inventory investment, to nonresidential fixed investment, and to PCE.


ADP National Employment Report increased by 218,000 in July
Posted: July 30, 2014 at 08:15 AM (Wednesday)

Private sector employment increased by 218,000 jobs from June to July according to the July ADP National Employment Report®. Broadly distributed to the public each month, free of charge, the ADP National Employment Report is produced by ADP®, a leading global provider of Human Capital Management (HCM) solutions, in collaboration with Moody’s Analytics. The report, which is derived from ADP’s actual payroll data, measures the change in total nonfarm private employment each month on a seasonally-adjusted basis.

Goods-producing employment rose by 16,000 jobs in July, down from 43,000 jobs gained in June. The construction industry added 12,000 jobs over the month, less than half last month’s gain. Meanwhile, manufacturing added 3,000 jobs in July, less than one-third the number of jobs added in June.

Service-providing employment rose by 202,000 jobs in July, down from 238,000 in June. The ADP National Employment Report indicates that professional/ business services contributed 61,000 jobs in July, down from 79,000 in June. Expansion in trade/transportation/utilities grew by 52,000, down slightly from June’s 56,000. The 9,000 new jobs added in financial activities was down 25% from last month’s number.

Although down from June, the July jobs number marks the fourth straight month of employment gains above 200,000.

The July employment gain was softer than June, but remains consistent with a steadily improving job market. At the current pace of job growth unemployment will quickly decline. Layoffs are still receding and hiring and job openings are picking up. If current trends continue, the economy will return to full employment by late 2016.

Payroll growth for businesses with 49 or fewer employees increased by 84,000 jobs in July. That’s down from 126,000 in June. Job growth was also down over the month for medium-sized and large firms. Employment among medium-sized companies with 50-499 employees rose by 92,000, down from 112,000 in June. Employment at large companies – those with 500 or more employees – increased by 41,000, down slightly from the previous month. Companies with 500-999 employees added 14,000, on par with June’s 15,000.


Purchase Apps down, Refi's down in Latest MBA Weekly Survey
Posted: July 30, 2014 at 07:00 AM (Wednesday)

Mortgage applications decreased 2.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 25, 2014.

The Market Composite Index, a measure of mortgage loan application volume, decreased 2.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 2 percent compared with the previous week. The Refinance Index decreased 4 percent from the previous week. The seasonally adjusted Purchase Index increased 0.2 percent from one week earlier. The unadjusted Purchase Index increased 1 percent compared with the previous week and was 12 percent lower than the same week one year ago.

The refinance share of mortgage activity decreased to 53 percent of total applications from 54 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 8 percent of total applications.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) remained unchanged at 4.33 percent, with points increasing to 0.24 from 0.23 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) increased to 4.22 percent from 4.21 percent, with points increasing to 0.23 from 0.20 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA remained unchanged at 4.03 percent, with points decreasing to 0.00 from 0.15 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 3.47 percent, with points decreasing to 0.25 from 0.28 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.

The average contract interest rate for 5/1 ARMs increased to 3.31 percent from 3.21 percent, with points increasing to 0.40 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

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