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Kansas City Fed Manufacturing Activity continues moderate paced expansion in Dec
Posted: December 19, 2014 at 11:00 AM (Friday)

Tenth District manufacturing activity continued to expand at a moderate pace in December, and producers’ expectations for future activity remained at solid levels. Most price indexes grew at a slower pace, especially materials prices.

The month-over-month composite index was 8 in December, up slightly from 7 in November and 4 in October (Tables 1 & 2, Chart). The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. The slight increase in activity was mostly attributed to durable goods producers, particularly for electronics, aircraft, and machinery products, while nondurable goods production remained sluggish. Most other month-over-month indexes were also slightly higher than last month. The production and employment indexes were unchanged, but the shipments, new orders, and order backlog indexes increased markedly. However, the new orders for exports index fell from 8 to 0. The finished goods inventory index rose for the second straight month, while the raw materials inventory index eased somewhat.

Year-over-year factory indexes were mixed. The composite year-over-year index edged up from 9 to 11, and the shipments, new orders, and new orders for exports indexes also increased. The employment index jumped from 10 to 18, its highest level in nearly two years. In contrast, the production index eased from 15 to 11, and the order backlog and capital expenditures indexes also decreased. Both inventory indexes increased after two months of decline.

Future factory indexes were mostly stable at solid levels. The future composite index was unchanged at 22, while the future shipments, new orders, and employment indexes increased further. The future capital spending index jumped from 15 to 23, its highest level in five months. In contrast, the future production index eased from 34 to 30, and the future order backlog index also inched lower. The future finished goods inventory index rose from 9 to 19, while the future raw materials inventory index edged down.

Most price indexes slowed in December. The month-over-month raw materials price index decreased from 12 to 5, and the finished goods price index fell to 0. The year-over-year raw materials price index eased slightly, while the finished goods price index was basically unchanged. The future raw materials price index moderated from 33 to 25, while the future finished goods price index ticked up somewhat.


U.S. Leading Economic Index increased 0.6%
Posted: December 18, 2014 at 10:00 AM (Thursday)

The Conference Board Leading Economic Index® (LEI) for the U.S. increased 0.6 percent in November to 105.5 (2004 = 100), following a 0.6 percent increase in October, and a 0.8 percent increase in September.

The increase in the LEI signals continued moderate growth through the winter season. The biggest challenge has been, and remains, more income growth. However, with labor market conditions tightening, we are seeing the first signs of wage growth starting to pick up.

Widespread and persistent gains in the LEI point to strong underlying conditions in the U.S. economic expansion. The current situation, measured by the coincident economic index, has been improving steadily, with employment and industrial production making the largest contributions in November.

The Conference Board Coincident Economic Index® (CEI) for the U.S. increased 0.4 percent in November to 110.7 (2004 = 100), following a 0.2 percent increase in October, and a 0.3 percent increase in September.

The Conference Board Lagging Economic Index® (LAG) for the U.S. increased 0.3 percent in November to 125.4 (2004 = 100), following no change in October, and a 0.1 percent increase in September.


Philadelphia December Outlook Suggest Reduced Activity
Posted: December 18, 2014 at 10:00 AM (Thursday)

Firms responding to the Manufacturing Business Outlook Survey indicated that the pace of regional manufacturing activity remained positive but decreased in December. The survey’s current indicators for general activity, new orders, shipments, and employment suggest growth; however, their values for this month were significantly lower than last month’s. The survey's indicators of future activity show optimism about continued growth over the next six months but declined slightly from last month’s readings.

Indicators Suggest Reduced Activity
The survey’s broadest measure of manufacturing conditions, the diffusion index of current activity, decreased 16 points, from a reading of 40.8 in November to 24.5 this month. The new orders and current shipments indexes also weakened significantly. The demand for manufactured goods, as measured by the current new orders index, decreased 20 points, from a reading of 35.7 last month to 15.7 this month. Shipments also fell, with its index falling 16 points to 16.1. Despite these declines from November, all the broad current activity indexes show a positive trend over the course of the current year.

Firms’ responses suggest deterioration in the labor market compared with November. The current employment index fell 15 points, as the percentage of firms reporting an increase in employees fell from 29 percent in November to 17 percent in December. The percentage of firms reporting a longer workweek was greater than the percentage reporting a shorter workweek (20 percent versus 14 percent). Nonetheless, the workweek index fell almost 2 points, to 6.2.

Firms Report Modest Price Increases
Input price pressures were reported to be slightly lower than last month’s: The prices paid index fell 3 points to 14.0 in December. Most firms reported that input prices were unchanged. With respect to prices received for manufactured goods, about 18 percent of the firms reported higher prices in December, and the index rose 1 point, to 12.5.

Future Indicators Weaken but Still Reflect Expected Growth
The diffusion index for future activity edged down 6 points, to 51.9, in December (see Chart 1). The future indexes for new orders and shipments both fell 3 points, but a majority of the firms continue to expect increased orders and shipments over the next six months. Firms also pulled back their expectations about employment growth. More than 51 percent of the firms are expecting no change in their employment levels over the next six months, compared with 41 percent last month. While the future employment index decreased, from 31.5 in November to 21.7 in December, the future workweek index rose about 8 points, to 18.3.

Input and Labor Cost Expectations
In this month’s special questions, firms were asked about their expectations for changes in various input and labor costs for the coming year (see Special Questions). The responses indicate that the largest average-annual increase is expected to be for health benefits (8.2 percent), which is similar to responses to the same questions in recent prior years. Wages and nonhealth benefits are expected to rise only 2.3 percent and 1.3 percent, respectively. Firms were also asked how the expected cost increases will compare with 2014 costs. For most categories, a majority of the firms reported that their costs would remain the same. One exception was the health benefits category, with 67 percent expecting higher costs. The share of firms indicating that their energy costs would be lower in 2014 was 48 percent, while the share that expected their energy costs to be the same was 32 percent.

Summary
The December Manufacturing Business Outlook Survey suggests a slower pace of expansion of the region’s manufacturing sector but general optimism about the future. Firms were less optimistic about employment increases over the next six months, however, and concerns about rising health-care costs continue to be reported.


DJ-BTMU U.S. Business Barometer declined by 0.3%
Posted: December 18, 2014 at 10:00 AM (Thursday)

For the week ending December 6 2014, the DJ-BTMU U.S. Business Barometer continued to decline by 0.3 percent to 98.5. This week’s barometer was driven by both consumption and production indexes. Chain store sales fell by 1.9 percent, on an inflation-adjusted basis, mainly owing to a stagnant holiday shopping after the Thanksgiving week big increase. As to the production side, auto and truck production dropped by 17.8 and 6.4 percent respectively, while electric output increased 2.6 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, declined by 0.1 percent to 98.7. Its year-over-year growth rate was 0.6 percent.


Weekly Initial Unemployment Claims Decrease 6,000 to 289,000
Posted: December 18, 2014 at 08:30 AM (Thursday)

In the week ending December 13, the advance figure for seasonally adjusted initial claims was 289,000, a decrease of 6,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 294,000 to 295,000. The 4-week moving average was 298,750, a decrease of 750 from the previous week's revised average. The previous week's average was revised up by 250 from 299,250 to 299,500. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.8 percent for the week ending December 6, a decrease of 0.1 percentage point from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending December 6 was 2,373,000, a decrease of 147,000 from the previous week's revised level. The previous week's level was revised up 6,000 from 2,514,000 to 2,520,000. The 4-week moving average was 2,397,000, an increase of 10,000 from the previous week's revised average. The previous week's average was revised up by 1,500 from 2,385,500 to 2,387,000.


FOMC target funds rate maintained at 0 - 1/4%
Posted: December 17, 2014 at 02:00 PM (Wednesday)

Information received since the Federal Open Market Committee met in October suggests that economic activity is expanding at a moderate pace. Labor market conditions improved further, with solid job gains and a lower unemployment rate. On balance, a range of labor market indicators suggests that underutilization of labor resources continues to diminish. Household spending is rising moderately and business fixed investment is advancing, while the recovery in the housing sector remains slow. Inflation has continued to run below the Committee's longer-run objective, partly reflecting declines in energy prices. Market-based measures of inflation compensation have declined somewhat further; survey-based measures of 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 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. The Committee expects inflation to rise gradually toward 2 percent as the labor market improves further and the transitory effects of lower energy prices and other factors dissipate. The Committee continues to monitor inflation developments closely.

To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that the current 0 to 1/4 percent target range for the federal funds rate remains appropriate. In determining how long to maintain this target range, 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. Based on its current assessment, the Committee judges that it can be patient in beginning to normalize the stance of monetary policy. The Committee sees this guidance as consistent with its previous statement that it likely will be appropriate to maintain the 0 to 1/4 percent target range for the federal funds rate for a considerable time following the end of its asset purchase program in October, 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. However, if incoming information indicates faster progress toward the Committee's employment and inflation objectives than the Committee now expects, then increases in the target range for the federal funds rate are likely to occur sooner than currently anticipated. Conversely, if progress proves slower than expected, then increases in the target range are likely to occur later than currently anticipated.

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. This policy, by keeping the Committee's holdings of longer-term securities at sizable levels, should help maintain accommodative financial conditions.

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; Loretta J. Mester; Jerome H. Powell; and Daniel K. Tarullo.

Voting against the action were Richard W. Fisher, who believed that, while the Committee should be patient in beginning to normalize monetary policy, improvement in the U.S. economic performance since October has moved forward, further than the majority of the Committee envisions, the date when it will likely be appropriate to increase the federal funds rate; Narayana Kocherlakota, who believed that the Committee's decision, in the context of ongoing low inflation and falling market-based measures of longer-term inflation expectations, created undue downside risk to the credibility of the 2 percent inflation target; and Charles I. Plosser, who believed that the statement should not stress the importance of the passage of time as a key element of its forward guidance and, given the improvement in economic conditions, should not emphasize the consistency of the current forward guidance with previous statements.


3Q2014 Current Account Deficit Increased
Posted: December 17, 2014 at 08:30 AM (Wednesday)

The U.S. current-account deficit—a net measure of transactions between the United States and the rest of the world in goods, services, primary income (investment income and compensation), and secondary income (current transfers)—increased to $100.3 billion (preliminary) in the third quarter of 2014 from $98.4 billion (revised) in the second quarter. The deficit remained at 2.3 percent of current-dollar gross domestic product (GDP). The increase in the current-account deficit was more than accounted for by an increase in the deficit on secondary income. In addition, the surplus on services decreased. These changes were partly offset by a decrease in the deficit on goods and an increase in the surplus on primary income.


Consumer Price Index declined 0.3% in November, Ex Fd & Engy up 0.1%
Posted: December 17, 2014 at 08:30 AM (Wednesday)

The Consumer Price Index for All Urban Consumers (CPI-U) declined 0.3 percent in November on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 1.3 percent before seasonal adjustment.

The gasoline index posted its sharpest decline since December 2008 and was the main cause of the decrease in the seasonally adjusted all items index. The indexes for fuel oil and natural gas also declined, and the energy index fell 3.8 percent. The food index rose 0.2 percent with major grocery store food groups mixed.

The index for all items less food and energy increased 0.1 percent in November. The shelter index rose 0.3 percent, and the indexes for medical care, airline fares, and alcoholic beverages also rose. In contrast, the indexes for apparel, used cars and trucks, recreation, household furnishings and operations, personal care, and new vehicles all declined in November.

The all items index increased 1.3 percent over the last 12 months, a notable decline from the 1.7 percent figure from the 12 months ending October. The index for all items less food and energy has increased 1.7 percent over the last 12 months, compared to 1.8 percent for the 12 months ending October. The food index has risen 3.2 percent over the span. However, the energy index has declined 4.8 percent over the past 12 months, with the gasoline and fuel oil indexes both falling over 10 percent.


Real Average Hourly Earnings rose 0.6% in November
Posted: December 17, 2014 at 08:30 AM (Wednesday)

Real average hourly earnings for all employees rose 0.6 percent from October to November, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This result stems from a 0.4 percent increase in average hourly earnings combined with a 0.3 percent decrease in the Consumer Price Index for All Urban Consumers (CPI-U).

Real average weekly earnings increased by 0.9 percent over the month due to the increase in real average hourly earnings combined with a 0.3 percent increase in the average workweek.

Real average hourly earnings increased by 0.8 percent, seasonally adjusted, from November 2013 to November 2014. This increase in real average hourly earnings, combined with a 0.3 percent increase in the average workweek, resulted in a 1.1 percent increase in real average weekly earnings over this period.


Purchase Apps down, Refi's unchanged in Latest MBA Weekly Survey
Posted: December 17, 2014 at 08:30 AM (Wednesday)

Mortgage applications decreased 3.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 12, 2014.

The Market Composite Index, a measure of mortgage loan application volume, decreased 3.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 4 percent compared with the previous week. The Refinance Index remained unchanged from the previous week. The seasonally adjusted Purchase Index decreased 7 percent from one week earlier. The unadjusted Purchase Index decreased 10 percent compared with the previous week and was 5 percent lower than the same week one year ago.

“Amid plummeting oil prices and heightened concerns regarding global economic growth, interest rates dropped sharply through the course of the week, with longer-term Treasury yields falling more than 10 basis points. The average mortgage rate also dropped during the week, with several lenders offering 30-year fixed-rate loans with rates below four percent. The 30-year conforming rate was at its lowest level since May 2013, and the 30-year jumbo rate averaged 3.99 percent for the week,” said Mike Fratantoni, MBA’s Chief Economist. “Surprisingly, given this large drop in rates, applications for conventional refinance mortgages did not increase last week, but there was a notable pickup in government refinance applications, which were up 11 percent for the week, led by an almost 16 percent increase in VA refinance applications.”

The refinance share of mortgage activity increased to 66 percent of total applications, the highest level since December 2013, from 64 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 6.2 percent of total applications.

The FHA share of total applications decreased to 8.7 percent this week from 9.0 percent last week. The VA share of total applications increased to 10.6 percent this week from 9.6 percent last week. The USDA share of total applications remained unchanged at 0.8 percent this week.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.06 percent, the lowest level since May 2013, from 4.11 percent, with points decreasing to 0.21 from 0.28 (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 3.99 percent, the lowest level since May 2013, from 4.07 percent, with points increasing to 0.28 from 0.16 (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 3.86 percent from 3.87 percent, with points decreasing to -0.04 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 3.33 percent from 3.35 percent, with points decreasing to 0.27 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 3.00 percent from 3.11 percent, with points increasing to 0.43 from 0.19 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.


November Housing Starts down 1.6%, Permits down 5.2%
Posted: December 16, 2014 at 08:30 AM (Tuesday)

BUILDING PERMITS
Privately-owned housing units authorized by building permits in November were at a seasonally adjusted annual rate of 1,035,000. This is 5.2 percent (±1.4%) below the revised October rate of 1,092,000 and is 0.2 percent (±1.8%) below the November 2013 estimate of 1,037,000. Single-family authorizations in November were at a rate of 639,000; this is 1.2 percent (±1.4%) below the revised October figure of 647,000. Authorizations of units in buildings with five units or more were at a rate of 367,000 in November.

HOUSING STARTS
Privately-owned housing starts in November were at a seasonally adjusted annual rate of 1,028,000. This is 1.6 percent (±8.1%) below the revised October estimate of 1,045,000 and is 7.0 percent (±10.2%) below the November 2013 rate of 1,105,000. Single-family housing starts in November were at a rate of 677,000; this is 5.4 percent (±8.1%) below the revised October figure of 716,000. The November rate for units in buildings with five units or more was 340,000.

HOUSING COMPLETIONS
Privately-owned housing completions in November were at a seasonally adjusted annual rate of 863,000. This is 6.4 percent (±8.3%) below the revised October estimate of 922,000, but is 4.5 percent (±9.6%) above the November 2013 rate of 826,000. Single-family housing completions in November were at a rate of 596,000; this is 2.9 percent (±8.2%) below the revised October rate of 614,000. The November rate for units in buildings with five units or more was 256,000.


ICSC Chain Store Sales rose 3.0% in Dec 13 Wk
Posted: December 16, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers and Goldman Sachs Retail Chain Store Sales Index rose 3% in the week ended Saturday from the previous week on a seasonally adjusted, comparable-store basis.

The recent volatility reflects increased promotions of the season, according to Michael Niemira, ICSC research consultant.

"Consumers actually reported being considerably behind on their shopping compared to the same week last year--so the last few shopping days prior to Christmas should be robust," he added.

On a year-to-year basis, the weekly reading increased 1.1%


Builder Confidence fell 1 points in December to 57
Posted: December 15, 2014 at 10:00 AM (Monday)

Following a four-point uptick last month, builder confidence in the market for newly built single-family homes fell one point in December to a level of 57 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today.

Members in many markets across the country have seen their businesses improve over the course of the year, and we expect builders to remain confident in 2015.

After a sluggish start to 2014, the HMI has stabilized in the mid-to-high 50s index level trend for the past six months, which is consistent with our assessment that we are in a slow march back to normal. As we head into 2015, the housing market should continue to recover at a steady, gradual pace.

Two of the three HMI components posted slight losses in December. The index gauging current sales conditions fell one point to 61, while the index measuring expectations for future sales dropped a single point to 65 and the index gauging traffic of prospective buyers held steady at 45.

Looking at the three-month moving averages for regional HMI scores, the West rose by four points to 62 and the Northeast edged up one point to 45, while the Midwest registered a three-point loss to 54 and the South dropped two points to 60.


Industrial Production increased 1.3%
Capacity Utilization increased 0.8% to 80.1%

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

Industrial production increased 1.3 percent in November after edging up in October; output is now reported to have risen at a faster pace over the period from June through October than previously published. In November, manufacturing output increased 1.1 percent, with widespread gains among industries. The rise in factory output was well above its average monthly pace of 0.3 percent over the previous five months and was its largest gain since February. In November, the output of utilities jumped 5.1 percent, as weather that was colder than usual for the month boosted demand for heating. The index for mining decreased 0.1 percent. At 106.7 percent of its 2007 average, total industrial production in November was 5.2 percent above its year-earlier level. Capacity utilization for the industrial sector increased 0.8 percentage point in November to 80.1 percent, a rate equal to its long-run (1972–2013) average.


Empire State Manufacturing Survey Conditions signaled a decline
Posted: December 15, 2014 at 08:30 AM (Monday)

The December 2014 Empire State Manufacturing Survey indicates that business activity declined for New York manufacturers. The headline general business conditions index dropped fourteen points to -3.6, its first negative reading in nearly two years. The new orders index also fell into negative territory, tumbling eleven points to -2.0, and the shipments index fell to -0.2. Labor market conditions were mixed, with the index for number of employees holding steady at 8.3, while the average workweek index declined to -11.5. The prices paid index was little changed at 10.4, indicating a continued modest increase in input prices, while the prices received index climbed to 6.3. Indexes for the six-month outlook continued to convey optimism, but to a somewhat lesser extent than in recent months.

General Business Conditions Index Retreats below Zero
For the first time in nearly two years, the general business conditions index signaled a decline in business activity for New York manufacturers. The index retreated fourteen points to -3.6 in December, with 19 percent of respondents reporting that conditions had improved over the month and 23 percent reporting that conditions had worsened. Overall, readings for the headline index during the fourth quarter of 2014 mark a significant downshift in activity from the levels seen during the five-month period from May through September. The new orders index fell eleven points to -2.0, indicating a small decline in orders, and the shipments index dropped twelve points to -0.2—a sign that shipments were flat. The unfilled orders index plummeted seventeen points to -24.0. The delivery time index drifted down to -14.6, suggesting that delivery times were shorter, and the inventories index fell to -11.5, pointing to lower inventory levels.

Small Increases Seen in Input and Selling Prices
The prices paid index was little changed at 10.4, signaling only a modest increase in input prices for a third consecutive month. After falling to zero in November, the prices received index advanced six points to 6.3 in December—evidence of a small increase in selling prices. Labor market indicators were mixed. The index for number of employees, at 8.3, held steady for a third consecutive month, suggesting that employment levels continued to increase. The average workweek index, by contrast, declined for a fourth consecutive month, and at -11.5, pointed to a noteworthy decline in hours worked.

Optimism Softens, but Remains High
Indexes assessing the six-month outlook were generally lower this month, but nevertheless conveyed considerable optimism about future business activity. The index for future general business conditions fell nine points to 38.6—still a fairly high figure by historical standards. The future new orders and shipments indexes declined to similar levels. The index for expected number of employees was 20.8, indicating that employment is expected to expand briskly, and the future average workweek index climbed to 12.5, its highest level in more than two years. The capital expenditures index fell twelve points to 15.6, and the technology spending index inched down to 17.7.


Producer Price Index fell 0.2% in November, ex Fd & Engy down 0.1%
Posted: December 12, 2014 at 08:30 AM (Friday)

The Producer Price Index for final demand fell 0.2 percent in November, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This decrease followed a 0.2-percent rise in October and a 0.1-percent decline in September. On an unadjusted basis, the index for final demand advanced 1.4 percent for the 12 months ended in November, the smallest 12-month increase since a 1.2-percent rise in February 2014.

In November, the 0.2-percent decline in final demand prices can be traced to the index for final emand goods, which decreased 0.7 percent. In contrast, prices for final demand services advanced 0.1 percent.

Within intermediate demand, prices for processed goods declined 1.0 percent, the index for unprocessed goods fell 1.3 percent, and prices for services moved up 0.3 percent.


Business Inventories up 0.2% in October
Posted: December 11, 2014 at 10:00 AM (Thursday)

The U.S. Census Bureau announced today that the combined value of distributive trade sales and manufacturers’ shipments for October, adjusted for seasonal and trading-day differences but not for price changes, was estimated at $1,350.9 billion, down 0.1 percent (±0.3%)* from September 2014, but were up 3.4 percent (±0.5%) from October 2013.

Manufacturers’ and trade inventories, adjusted for seasonal variations but not for price changes, were estimated at an end-of-month level of $1,760.4 billion, up 0.2 percent (±0.1%) from September 2014 and up 4.8 percent (±0.5%) from October 2013.

The total business inventories/sales ratio based on seasonally adjusted data at the end of October was 1.30. The October 2013 ratio was 1.29.


DJ-BTMU U.S. Business Barometer declined by 0.2%
Posted: December 11, 2014 at 10:00 AM (Thursday)

For the week ending November 29 2014, the DJ-BTMU U.S. Business Barometer declined by 0.2 percent to 98.8 after three weeks of positive growth. This week’s barometer was driven by both consumption and production indexes. Chain store sales fell by 1.8 percent, mainly owing to weak performance in department and non-apparel speciality stores business. As to the production side, electric output dropped by 11.2 percent, although it was partially offset by gains in auto and truck production, which climbed by 22.7 and 3.5 percent, respectively.

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, increased by 0.1 percent to 98.8. Its year-over-year growth rate was 0.9 percent.


U.S. Import Price Index declined 1.5% in November
Posted: December 11, 2014 at 08:30 AM (Thursday)

U.S. import prices declined 1.5 percent in November, after falling 1.2 percent in October, the U.S. Bureau of Labor Statistics reported today. Both decreases were driven by declining fuel prices. The price index for U.S. exports fell 1.0 percent in November following a 0.9-percent drop the previous month.


U.S. Retail Sales for August increase 0.3%, Ex-Auto up 0.3%
Posted: December 11, 2014 at 08:30 AM (Thursday)

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for November, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $449.3 billion, an increase of 0.7 percent (±0.5%) from the previous month, and 5.1 percent (±0.9%) above November 2013. Total sales for the September through November 2014 period were up 4.7 percent (±0.7%) from the same period a year ago. The September to October 2014 percent change was revised from +0.3 percent (±0.5%)* to +0.5 percent (±0.2%).

Retail trade sales were up 0.7 percent (± 0.5%) from October 2014, and 4.9 percent (±0.7%) above last year. Auto and other motor vehicle dealers were up 9.5 percent (±3.2%) from November 2013 and non-store retailers were up 8.7 percent (±2.1%) from last year.


Weekly Initial Unemployment Claims Decrease 3,000 to 294,000
Posted: December 11, 2014 at 08:30 AM (Thursday)

In the week ending December 6, the advance figure for seasonally adjusted initial claims was 294,000, a decrease of 3,000 from the previous week's unrevised level of 297,000. The 4-week moving average was 299,250, an increase of 250 from the previous week's unrevised average of 299,000. 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 November 29, an increase of 0.1 percentage point from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending November 29 was 2,514,000, an increase of 142,000 from the previous week's revised level. The previous week's level was revised up 10,000 from 2,362,000 to 2,372,000. The 4-week moving average was 2,385,500, an increase of 27,750 from the


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

Mortgage applications increased 7.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 5, 2014.

The Market Composite Index, a measure of mortgage loan application volume, increased 7.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 52 percent compared with the previous week. The Refinance Index increased 13 percent from the previous week. The seasonally adjusted Purchase Index increased 1 percent from one week earlier. The unadjusted Purchase Index increased 37 percent compared with the previous week and was 4 percent lower than the same week one year ago.

The refinance share of mortgage activity increased to 64 percent of total applications from 60 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.0 percent of total applications.

The FHA share of total applications decreased to 9.0 percent this week from 9.3 percent last week. The VA share of total applications increased to 9.6 percent this week from 9.4 percent last week. The USDA share of total applications remained unchanged at 0.8 percent this week.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.11 percent from 4.08 percent, with points remaining unchanged from 0.28 (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 4.07 percent from 4.11 percent, with points decreasing to 0.16 from 0.22 (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 3.87 percent from 3.85 percent, with points decreasing to 0.03 from 0.09 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.35 percent from 3.30 percent, with points increasing to 0.30 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 3.11 percent from 3.07 percent, with points decreasing to 0.19 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.


Wholesale Inventories up 0.4% in October
Posted: December 9, 2014 at 10:00 PM (Tuesday)

The U.S. Census Bureau announced today that October 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 $454.6 billion, up 0.2 percent (+/-0.9) from the revised September level and were up 4.3 percent (+/-1.4%) from the October 2013 level. The September preliminary estimate was revised downward $0.6 billion or 0.1 percent. October sales of durable goods were up 0.8 percent (+/-1.2%) from last month and were up 6.0 percent (+/-1.4%) from a year ago. Sales of electrical and electronic goods were up 1.9 percent from last month. Sales of nondurable goods were down 0.3 percent (+/-1.1%) from September, but were up 2.8 percent (+/-2.5%) from last October. Sales of petroleum and petroleum products were down 5.8 percent from last month, while sales of farm product raw materials were up 8.0 percent.

Total inventories of merchant wholesalers, except manufacturers’ sales branches and offices, after adjustment for seasonal variations but not for price changes, were $542.0 billion at the end of October, up 0.4 percent (+/-0.4%) from the revised September level and were up 6.8 percent (+/-1.1%) from the October 2013 level. The September preliminary estimate was revised upward $0.9 billion or 0.2 percent. October inventories of durable goods were virtually unchanged (+/-0.4%) from last month, but were up 8.5 percent (+/-1.4%) from a year ago. Inventories of computer and computer peripheral equipment and software were down 3.6 percent from last month, while inventories of hardware and plumbing and heating equipment and supplies were up 1.6 percent. Inventories of nondurable goods were up 1.2% (+/-0.7%) from September and were up 4.2 percent (+/-1.2%) from last October. Inventories of drugs and druggists' sundries were up 3.2 percent from last month and inventories of paper and paper products were up 1.6 percent.

The October inventories/sales ratio for merchant wholesalers, except manufacturers’ sales branches and offices, based on seasonally adjusted data, was 1.19. The October 2013 ratio was 1.16.


Job Openings were 4.8 million in October
Posted: December 9, 2014 at 10:00 AM (Tuesday)

There were 4.8 million job openings on the last business day of October, little changed from 4.7 million in September, the U.S. Bureau of Labor Statistics reported today. Hires (5.1 million) and separations (4.8 million) were steady in October. Within separations, the quits rate (1.9 percent) was little changed and the layoffs and discharges rate (1.2 percent) was 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 4.8 million job openings on the last business day of October. The job openings rate was 3.3 percent. The number of job openings was little changed for total private and declined for government in October. (See table 1.) The level of job openings decreased for state and local government. The job openings level was little changed in all four regions.

The number of job openings (not seasonally adjusted) increased over the 12 months ending in October for total nonfarm and total private, and was little changed for government. The job openings level increased over the year for many industries, including both professional and business services and accommodation and food services. The number of openings also increased over the year in all four regions.


ICSC Chain Store Sales decreased by 1.5% in Dec 6 Wk
Posted: December 9, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers and Goldman Sachs Retail Chain Store Sales Index fell 1.5% in the week ended Saturday from the previous week on a seasonally adjusted, comparable-store basis.

On a year-to-year basis, the weekly reading increased 2.9%.


NFIB Small Business Optimism Index gained 2.0 points to 98.1
Posted: December 9, 2014 at 07:30 AM (Tuesday)

The Small Business Optimism Index gained 2.0 points, taking the Index to its highest level since February 2007. The average of the Index from 1974Q4 to 2014 to date is 98, which includes all the Great Recession readings. What didn’t improve were the four “hard” Index components: job creation plans, plans for capital outlays, job openings and inventory investment plans, together adding a negative 1 percentage point to the Index. The entire gain in the Index was accounted for by two components: Expectations for Business Conditions in Six Months and Expectations for Real Sales Volumes, adding a combined 21 percentage points to net favorable responses, perhaps a response to the November election results.

Last month, we asked if the election outcome would matter to small business owners, planning to look for evidence in the November survey results which are mailed in over the entire month. It clearly had no impact on hiring and spending plans, these were unchanged from October numbers. But expectations did improve, with a 16 percentage point gain in expectations for better business conditions in 6 months and a 5 point gain in expectations for higher real sales in the coming months, likely not a response to “Black Friday” or “Small Business Saturday” results.

Responses to the question “Is now a good time to expand your business substantially?” might also be a result of election euphoria. The percent responding NO fell 5 percentage points to 53 percent, nice, but not the lowest reading in 2014. However, the percent of those saying NO and blaming the “political climate” fell from 28 percent of those who said NO to 19 percent, a significant decline and the lowest since January, 2012. The high reading was 37 percent in October, 2013. So it appears likely that the election outcome played a significant role in improving the Index of Small Business Optimism, but only two of the ten Index components appeared to be impacted. What is needed is a translation of this optimism into spending and hiring.

Third quarter real GDP growth was revised up to 3.9 percent making the 6 months in the middle of 2014 one of the best growth periods in decades. However, this didn’t do much for small business job creation in the U.S. One reason is that a lot of this growth has been driven by inventory building, unusual defense outlays and exports, selling around the world, an activity that doesn’t involve many small businesses. Expectations for growth in the fourth quarter are not as rosy, reverting to the high 2 percent pace.

A new round of healthcare events will impact business owners in the coming months and consumers will find that their out of pocket outlays for healthcare will be rising because their policies have high deductibles. Just what impact this will have on spending remains to be seen.


Employment Trends Index increased in November to 123.24
Posted: December 8, 2014 at 10:00 AM (Monday)

The Conference Board Employment Trends Index™ (ETI) increased in November. The index now stands at 123.24, up from 122.8 (a downward revision) in October. This represents a 6.1 percent gain in the ETI compared to a year ago.

The Employment Trends Index increased for the 11th straight month in November, and recent solid improvements suggest that strong job growth is likely to continue into early next year. We will probably reach the natural rate of unemployment, 5.5 percent, within a few months, and these tighter labor market conditions should lead to acceleration in wage growth.

November’s increase in the ETI was driven by positive contributions from five of the eight components. In order from the largest positive contributor to the smallest, these were: Industrial Production, Ratio of Involuntarily Part-time to All Part-time Workers, Number of Temporary Employees, Real Manufacturing and Trade Sales, and Job Openings.


Consumer Credit Increased at an annual rate of 5.00%
Posted: December 5, 2014 at 03:00 PM (Friday)

In October, consumer credit increased at a seasonally adjusted annual rate of 5 percent. Revolving credit increased at an annual rate of 1-1/4 percent, while nonrevolving credit increased at an annual rate of 6-1/4 percent.


New orders for manufactured goods decreased 0.7%
Posted: December 5, 2014 at 10:00 AM (Friday)

New orders for manufactured goods in October, down three consecutive months, decreased $3.3 billion or 0.7 percent to $496.6 billion, the U.S. Census Bureau reported today. This followed a 0.5 percent September decrease. Excluding transportation, new orders decreased 1.4 percent.

Shipments, down two of the last three months, decreased $3.8 billion or 0.8 percent to $499.2 billion. This followed a 0.1 percent September increase.

Unfilled orders, up eighteen of the last nineteen months, increased $4.9 billion or 0.4 percent to $1,174.2 billion. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.4 percent September increase. The unfilled orders-to-shipments ratio was 6.73, up from 6.71 in September.

Inventories, up twenty-three of the last twenty-four months, increased $0.5 billion or 0.1 percent to $655.6 billion. This was also at the highest level since the series was first published on a NAICS basis and followed a 0.2 percent September increase. The inventories-to-shipments ratio was 1.31, up from 1.30 in September.


November Employment increased by 321,000
Unemployment Rate was unchanged at 5.8%

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

Total nonfarm payroll employment increased by 321,000 in November, and the unemployment rate was unchanged at 5.8 percent, the U.S. Bureau of Labor Statistics reported today. Job gains were widespread, led by growth in professional and business services, retail trade, health care, and manufacturing.

In November, the unemployment rate held at 5.8 percent, and the number of unemployed persons was little changed at 9.1 million. Over the year, the unemployment rate and the number of unemployed persons were down by 1.2 percentage points and 1.7 million, respectively.

Among the major worker groups, the unemployment rate for adult men rose to 5.4 percent in November. The rates for adult women (5.3 percent), teenagers (17.7 percent), whites (4.9 percent), blacks (11.1 percent), and Hispanics (6.6 percent) showed little change over the month. The jobless rate for Asians was 4.8 percent (not seasonally adjusted), little changed from a year earlier.

The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 2.8 million in November. These individuals accounted for 30.7 percent of the unemployed. Over the past 12 months, the number of long-term unemployed declined by 1.2 million.

The civilian labor force participation rate held at 62.8 percent in November and has been essentially unchanged since April. The employment-population ratio, at 59.2 percent, was unchanged in November but is up by 0.6 percentage point over the year.

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers), at 6.9 million, changed little in November. These individuals, who would have preferred full-time employment, were working part time because their hours had been cut back or because they were unable to find a full-time job.

In November, 2.1 million persons were marginally attached to the labor force, essentially unchanged 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 698,000 discouraged workers in November, little different 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 November had not searched for work for reasons such as school attendance or family responsibilities.

Total nonfarm payroll employment rose by 321,000 in November, compared with an average monthly gain of 224,000 over the prior 12 months. In November, job growth was widespread, led by gains in professional and business services, retail trade, health care, and manufacturing.

In November, the average workweek for all employees on private nonfarm payrolls rose by 0.1 hour to 34.6 hours. The manufacturing workweek rose by 0.2 hour to 41.1 hours, and factory overtime edged up by 0.1 hour to 3.5 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls was unchanged at 33.8 hours.

Average hourly earnings for all employees on private nonfarm payrolls rose by 9 cents to $24.66 in November. Over the year, average hourly earnings have risen by 2.1 percent. In November, average hourly earnings of private-sector production and nonsupervisory employees increased by 4 cents to $20.74.

The change in total nonfarm payroll employment for September was revised from +256,000 to +271,000, and the change for October was revised from +214,000 to +243,000. With these revisions, employment gains in September and October combined were 44,000 more than previously reported.


Goods and Services Deficit Decreased in October 2014
Posted: December 5, 2014 at 08:30 AM (Friday)

The Nation’s international trade deficit in goods and services decreased to $43.4 billion in October from $43.6 billion in September (revised), as exports increased more than imports.

The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that the goods and services deficit was $43.4 billion in October, down $0.2 billion from $43.6 billion in September, revised. October exports were $197.5 billion, $2.3 billion more than September exports. October imports were $241.0 billion, $2.1 billion more than September imports.

The October decrease in the goods and services deficit reflected a decrease in the goods deficit of less than $0.1 billion to $62.7 billion and an increase in the services surplus of $0.1 billion to $19.2 billion.

Year-to-date, the goods and services deficit increased $20.5 billion, or 5.1 percent, from the same period in 2013. Exports increased $57.8 billion or 3.1 percent. Imports increased $78.3 billion or 3.4 percent.


DJ-BTMU U.S. Business Barometer climbed by another 0.4%
Posted: December 4, 2014 at 10:00 AM (Thursday)

For the week ending November 22 2014, the DJ-BTMU U.S. Business Barometer climbed by another 0.4 percent to 99.0, extending the positive trend to three weeks. This week’s barometer was driven by both consumption and production indexes. Chain store sales jumped 2.2 percent partly owing to early Black Friday promotions, but was somewhat offset by a drop of 4.8 percent in MBA’s purchase index. As to the production side, all indexes, except auto and truck production, posted gains this week, particularly electric output, which rose by 6.5 percent.

On a year-over-year basis, the barometer showed a gain of 0.8 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, increased by 0.2 percent to 98.7. Its year-over-year growth rate was 0.9 percent.


Weekly Initial Unemployment Claims Decrease 17,000 to 297,000
Posted: December 4, 2014 at 08:30 AM (Thursday)

In the week ending November 29, the advance figure for seasonally adjusted initial claims was 297,000, a decrease of 17,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 313,000 to 314,000. The 4-week moving average was 299,000, an increase of 4,750 from the previous week's revised average. The previous week's average was revised up by 250 from 294,000 to 294,250. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.8 percent for the week ending November 22, unchanged from the previous week's revised rate. The previous week's rate was revised up by 0.1 from 1.7 to 1.8 percent. The advance number for seasonally adjusted insured unemployment during the week ending November 22 was 2,362,000, an increase of 39,000 from the previous week's revised level. The previous week's level was revised up 7,000 from 2,316,000 to 2,323,000. The 4-week moving average was 2,355,250, an increase of 1,500 from the previous week's revised average. The previous week's average was revised up by 1,750 from 2,352,000 to 2,353,750.


Challenger Layoffs declined by 30% in November
Posted: December 4, 2014 at 07:30 AM (Thursday)

Downsizing activity by U.S.-based employers declined by 30 percent in November, with 35,940 planned job cuts announced during the penultimate month of 2014, according to the report Thursday from global outplacement consultancy Challenger, Gray & Christmas, Inc.

The November slowdown comes just one month after job cuts surged 70 percent to 51,183 in October. The November total was 21 percent lower than the 45,314 job cuts announced the same month a year ago.

Heading into the final month of the year, employers have announced 450,531 job cuts, to date. That is down 5.8 percent from 478,428 at the same point in 2013. Currently, job cuts are on pace to finish 2014 with the lowest year-end total since 1997.

Companies in the consumer products industry saw the heaviest downsizing last month, shedding 5,158 jobs from their payrolls. The health care sector followed closely, with 5,124 announced job cuts during the month.

Year-to-date, the computer industry remains the top job-cutting industry, having announced 58,207 planned layoffs. That is nearly double the 29,558 job cuts announced by computer firms between January and November 2013.

The second leading job-cut industry to date is the retail sector, which has announced 41,588 job cuts this year, including 2,640 last month.

While retailers have cut about 9,500 jobs over the last two months, this is an area that continues to expand. Right now, these employers are adding tens of thousands of seasonal workers to help with the holiday rush. It is true that these jobs are temporary and most will be eliminated in the new year. However, government data show that employment in the sector has nearly reached pre-recession levels and continues to grow.

Seasonally-adjusted employment figures from the Bureau of Labor Statistics, which are intended to smooth out the volatile fluctuations related to seasonal hiring, show that there were 15.4 million workers in retail, as of October. That is just shy of the record-level of 15.5 million reached in 2007.

And, before dismissing all of these new jobs as low-skilled, low-paying sales clerk and cashier jobs, remember that the shift toward online shopping means retailers are hiring more and more app developers, IT security professionals, online and social media marketing teams, logistics engineers, as analysts to collect, sort and interpret all of that data collected with each mouse click.


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

Reports from the twelve Federal Reserve Districts suggest that national economic activity continued to expand in October and November. A number of Districts also noted that contacts remained optimistic about the outlook for future economic activity. Consumer spending continued to advance in most Districts, and reports on tourism were mostly positive. Employment gains were widespread across Districts, and Districts reporting on business spending generally noted some improvement. Demand for nonfinancial services generally increased. Manufacturing activity strengthened in most Districts. Construction and real estate activity expanded overall, but at a pace that varied by sector and by District. Lending typically held steady or increased. Crop yields were generally good, although overly wet or dry conditions were an issue in some Districts. Most crop prices were lower than last year, but livestock prices were higher. Energy and mining activity was higher on net, though lower oil prices were a concern for the oil industry in the Atlanta and Dallas Districts. Overall price and wage inflation remained subdued.


Help Wanted OnLine Labor Demand rose 170,200 to 5,253,900 in November
Posted: December 3, 2014 at 10:00 AM (Wednesday)

Online advertised vacancies rose 170,200 to 5,253,900 in November, according to The Conference Board Help Wanted OnLine® (HWOL) Data Series, released today. The October Supply/Demand rate stands at 1.77 unemployed for each advertised vacancy with a total of 3.9 million more unemployed workers than the number of advertised vacancies. The number of unemployed was 9.0 million in October.

November labor demand shows renewed strength, helping to boost a slow-growth second half of the year. Gains were widespread across States and MSAs with continued positive trend growth across much of the U.S.

In November, the Professional category saw strong gains in Management (17,100), Business and Finance (15,400) and Computer (12,800) with a loss in Healthcare (-11,400). The Services/Production category saw gains in Office/Admin (43,100), Food (20,100) and Transportation (16,900) with a small drop in Sales (-8,800). Supply/Demand rates continue to improve, providing better opportunities for job seekers).


ISM Non-Manufacturing Index increased to 59.3%
Posted: December 3, 2014 at 10:00 AM (Wednesday)

Economic activity in the non-manufacturing sector grew in November for the 58th consecutive month, say the nation’s purchasing and supply executives in the latest Non-Manufacturing ISM® Report On Business®.

The NMI® registered 59.3 percent in November, 2.2 percentage points higher than the October reading of 57.1 percent. This represents continued growth in the non-manufacturing sector. The Non-Manufacturing Business Activity Index increased to 64.4 percent, which is 4.4 percentage points higher than the October reading of 60 percent, reflecting growth for the 64th consecutive month at a faster rate. The New Orders Index registered 61.4 percent, 2.3 percentage points higher than the reading of 59.1 percent registered in October. The Employment Index decreased 2.9 percentage points to 56.7 percent from the October reading of 59.6 percent and indicates growth for the ninth consecutive month. The Prices Index increased 2.3 percentage points from the October reading of 52.1 percent to 54.4 percent, indicating prices increased at a faster rate in November when compared to October. According to the NMI®, 14 non-manufacturing industries reported growth in November. Comments from the majority of respondents indicate that business conditions are on track for continued growth. The respondents have also stated that there is some strain on capacity due to the month-over-month increase in activity.

INDUSTRY PERFORMANCE
The 14 non-manufacturing industries reporting growth in November — listed in order — are: Retail Trade; Construction; Agriculture, Forestry, Fishing & Hunting; Other Services; Health Care & Social Assistance; Accommodation & Food Services; Finance & Insurance; Professional, Scientific & Technical Services; Public Administration; Wholesale Trade; Information; Management of Companies & Support Services; Mining; and Transportation & Warehousing. The three industries reporting contraction in November are: Arts, Entertainment & Recreation; Utilities; and Educational Services.


3Q2014 Productivity Growth Increased 2.3%
Posted: December 3, 2014 at 08:30 AM (Wednesday)

Nonfarm business sector labor productivity increased at a 2.3 percent annual rate during the third quarter of 2014, the U.S. Bureau of Labor Statistics reported today, as output increased 4.9 percent and hours worked increased 2.5 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the third quarter of 2013 to the third quarter of 2014, productivity rose 1.0 percent as output and hours worked increased 3.1 percent and 2.1 percent, respectively.

Unit labor costs in the nonfarm business sector fell 1.0 percent in the third quarter of 2014, as a 1.3 percent increase in hourly compensation was smaller than the 2.3 percent gain in productivity. Unit labor costs increased 1.2 percent over the last four quarters.

Manufacturing sector productivity increased 2.9 percent in the third quarter of 2014, as output increased 4.2 percent and hours worked increased 1.3 percent. Productivity increased 3.2 percent in the durable goods sector and increased 3.5 percent in the nondurable goods sector. Over the last four quarters, manufacturing productivity increased 2.7 percent, as output increased 4.4 percent and hours increased 1.6 percent. Unit labor costs in manufacturing fell 1.3 percent in the third quarter of 2014 and decreased 0.5 percent from the same quarter a year ago.

Preliminary third-quarter 2014 measures were announced today for the nonfinancial corporate sector. Productivity increased 1.1 percent as output and hours rose 4.0 percent and 2.9 percent, respectively.


ADP National Employment Report increased by 208,000 in November
Posted: December 3, 2014 at 08:15 AM (Wednesday)

Private sector employment increased by 208,000 jobs from October to November according to the November 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.

Payrolls for businesses with 49 or fewer employees increased by 101,000 jobs in November, down slightly from 103,000 in October. Job growth was down significantly over the month for medium-sized firms. Employment among companies with 50-499 employees rose by 65,000, well below October’s increase of 122,000. Employment at large companies – those with 500 or more employees – saw a rebound from 7,000 the previous month to 42,000 jobs added in November. Companies with 500-999 employees added 10,000 jobs, down from October’s 14,000. However, this drop was more than offset by the addition of 32,000 jobs by companies with over 1,000 employees.

Goods-producing employment rose by 32,000 jobs in November, down from 46,000 jobs gained in October. The construction industry added 17,000 jobs over the month, well below last month’s gain of 27,000. Meanwhile, manufacturing added 11,000 jobs in November, down slightly from October’s 13,000.

Service-providing employment rose by 176,000 jobs in November, down from 187,000 in October. The ADP National Employment Report indicates that professional/business services contributed 37,000 jobs in November. Expansion in trade/transportation/utilities grew by 49,000, just above October’s 48,000. The 5,000 new jobs added in financial activities was below last month’s 6,000.

November continued to show solid job growth above 200,000. Small businesses continued to drive job gains adding almost half the total for the month.

Steady as she goes in the job market. Monthly job gains remain consistently over 200,000. At this pace the unemployment rate will drop by half a percentage point per annum. The tightening in the job market will soon prompt acceleration in wage growth.


Purchase Apps down, Refi's down in Latest MBA Weekly Survey
Posted: December 3, 2014 at 07:00 AM (Wednesday)

Mortgage applications decreased 7.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending November 28, 2014. This week’s results included an adjustment for the Thanksgiving holiday.

The Market Composite Index, a measure of mortgage loan application volume, decreased 7.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 37 percent compared with the previous week. The Refinance Index decreased 13 percent from the previous week. The seasonally adjusted Purchase Index increased 3 percent from one week earlier. The unadjusted Purchase Index decreased 32 percent compared with the previous week and was 4 percent lower than the same week one year ago.

The refinance share of mortgage activity decreased to 60 percent of total applications from 63 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 6.7 percent of total applications.

The FHA share of total applications decreased to 9.3 percent this week from 9.4 percent last week. The VA share of total applications decreased to 9.4 percent this week from 10.3 percent last week. The USDA share of total applications remained unchanged at 0.8 percent this week.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.08 percent, the lowest level since May 2013, from 4.15 percent, with points increasing to 0.28 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) increased to 4.11 percent from 4.10 percent, with points decreasing to 0.22 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 30-year fixed-rate mortgages backed by the FHA decreased to 3.85 percent from 3.90 percent, with points decreasing to 0.09 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 decreased to 3.30 percent from 3.35 percent, with points remaining unchanged from 0.25 (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 increased to 3.07 percent from 3.06 percent, with points decreasing to 0.32 from 0.41 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.


Construction Spending increased 1.1% in October
Posted: December 2, 2014 at 10:00 AM (Tuesday)

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during October 2014 was estimated at a seasonally adjusted annual rate of $971.0 billion, 1.1 percent (±1.8%) above the revised September estimate of $960.3 billion. The October figure is 3.3 percent (±2.0%) above the October 2013 estimate of $939.9 billion. During the first 10 months of this year, construction spending amounted to $800.6 billion, 5.8 percent (±1.3%) above the $756.5 billion for the same period in 2013.

PRIVATE CONSTRUCTION
Spending on private construction was at a seasonally adjusted annual rate of $692.4 billion, 0.6 percent (±0.8%) above the revised September estimate of $688.0 billion. Residential construction was at a seasonally adjusted annual rate of $353.8 billion in October, 1.3 percent (±1.3%) above the revised September estimate of $349.1 billion. Nonresidential construction was at a seasonally adjusted annual rate of $338.6 billion in October, 0.1 percent (±0.8%) below the revised September estimate of $338.9 billion.

PUBLIC CONSTRUCTION
In October, the estimated seasonally adjusted annual rate of public construction spending was $278.6 billion, 2.3 percent (±3.1%) above the revised September estimate of $272.3 billion. Educational construction was at a seasonally adjusted annual rate of $64.5 billion, 2.2 percent (±3.8%) above the revised September estimate of $63.1 billion. Highway construction was at a seasonally adjusted annual rate of $82.0 billion, 1.1 percent (±7.6%) above the revised September estimate of $81.1 billion.


Paychex-IHS Small Business Jobs Index decreased to 100.73 in November
Posted: December 2, 2014 at 08:30 AM (Tuesday)

While the Paychex | IHS Small Business Jobs Index grew 0.07 percent in the past 12 months, the national index declined 0.11 percent in November, coming in at 100.73. Despite maintaining momentum in October, the national index has decreased by 0.25 percent over the past three months as strong employment growth conditions have weakened slightly. Small business job growth in the Central regions has kept the West North Central region at the top of the regional index for the second straight month. With strong 12-month growth rates, Washington and Dallas continue to lead the states and metro areas, respectively.

The Paychex | IHS Small Business Jobs Index declined in November, giving up the last of its 2014 gains. With an index level of 100.73, small business employment continues to grow, but at a moderate pace, reflecting levels seen since 2012.

Even though the national index shows small business employment growing at a moderate pace when compared to earlier this year, the continued strong performance among certain regions, states, and metro areas gives us reason for optimism," said Martin Mucci, president and CEO of Paychex.


New York Purchasing Managers Business Activity rose to 62.4 in November
Posted: December 2, 2014 at 08:30 AM (Tuesday)

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

Current Business Conditions rose to 62.4 in November, continuing the uneven faster-slower expansion that has characterized the second half of 2014.

Future optimism remained elevated. The Six-Month Outlook came in at 70.5 in November, the fourth month in the last five above the lofty 70 threshold.

Job growth cooled to a seven-month low after some hotter months recently. Employment fell to 48.4 in November.

Purchase volume eased to a seven-month low. Quantity of Purchases decreased to 50.0 in November.

Price measures did not deflate with lower oil and gasoline prices. Prices Paid was at 62.5 in November, and Prices Received increased to 58.3 in November.

The top line and forward guidance both moderated. Current Revenues fell to a 13-month low of 53.1 in November, and Expected Revenues declined to a six month low of 68.8 in November.


ICSC Chain Store Sales decreased by 1.8% in Nov 29 Wk
Posted: December 2, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 2.8% for the week ending November 29 - relative to the prior year. On a week-over-week basis, sales decreased by 1.8%.

"Early Black Friday promotions the previous week contributed to the sequential week to week decline," said Michael Niemira, ICSC research consultant. "Consumers actually reported being considerably behind on their shopping compared to the same week last year - which bodes well for December sales as consumers will play catch-up," he added.


October Manufacturing ISM expanded slower at 58.7
Posted: December 1, 2014 at 10:00 AM (Monday)

Economic activity in the manufacturing sector expanded in November for the 18th consecutive month, and the overall economy grew for the 66th consecutive month, say the nation’s supply executives in the latest Manufacturing ISM® Report On Business®.

The November PMI® registered 58.7 percent, a decrease of 0.3 percentage point from October’s reading of 59 percent, indicating continued expansion in manufacturing. The New Orders Index registered 66 percent, an increase of 0.2 percentage point from the reading of 65.8 percent in October. The Production Index registered 64.4 percent, 0.4 percentage point below the October reading of 64.8 percent. The Employment Index grew for the 17th consecutive month, registering 54.9 percent, a decrease of 0.6 percentage point below the October reading of 55.5 percent. Inventories of raw materials registered 51.5 percent, a decrease of 1 percentage point from the October reading of 52.5 percent. The Prices Index registered 44.5 percent, down 9 percentage points from the October reading of 53.5 percent, indicating lower raw materials prices in November relative to October. Comments from the panel are upbeat about strong demand and new orders, with some expressing concerns about West Coast port slowdowns and the threat of a potential dock strike.

Of the 18 manufacturing industries, 14 are reporting growth in November in the following order: Food, Beverage & Tobacco Products; Miscellaneous Manufacturing; Furniture & Related Products; Fabricated Metal Products; Textile Mills; Printing & Related Support Activities; Electrical Equipment, Appliances & Components; Paper Products; Plastics & Rubber Products; Machinery; Transportation Equipment; Nonmetallic Mineral Products; Petroleum & Coal Products; and Primary Metals. The only industry reporting contraction in November is Apparel, Leather & Allied Products.


New Home Sales in October at annual rate of 458,000
Posted: November 26, 2014 at 10:00 AM (Wednesday)

Sales of new single-family houses in October 2014 were at a seasonally adjusted annual rate of 458,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 0.7 percent (±16.5%) above the revised September rate of 455,000 and is 1.8 percent (±17.4%)* above the October 2013 estimate of 450,000.

The median sales price of new houses sold in October 2014 was $305,000; the average sales price was $401,100. The seasonally adjusted estimate of new houses for sale at the end of October was 212,000. This represents a supply of 5.6 months at the current sales rate.


Pending Home Sales Index decreased 1.1% in October
Posted: November 26, 2014 at 10:00 AM (Wednesday)

Pending home sales declined in October but remained at a healthy level of activity and are above year-over-year levels for the second straight month, according to the National Association of Realtors®.

The Pending Home Sales Index,* a forward-looking indicator based on contract signings, decreased 1.1 percent to 104.1 in October from an upwardly-revised 105.3 in September, but is 2.2 percent higher than October 2013 (101.9). The index is above 100—considered an average level of contract activity—for the sixth consecutive month.

Despite October's modest decline, contract signings have remained at a healthy pace now for six straight months. In addition to low interest rates, buyers entering the market this autumn are being lured by the increase in homes for sale and less competition from investors paying in cash. Demand is holding steady but would be more robust if it weren't for lagging wage growth and tight credit conditions that continue to hamper those individuals looking for relief from rising rents.

The median existing-home price1 for all housing types in October was $208,300, which is 5.5 percent above October 2013. Monthly median price growth has averaged 5.8 percent in 2014 (through October) after averaging 11.5 percent last year.

The increase in median prices for existing-homes has leveled off, representing a healthier pace that has kept affordability in-check for buyers in many parts of the country while giving more previously stuck homeowners with little or no equity the ability to sell.

Evidence of rising home prices allowing more willing homeowners the ability to sell can be found in NAR's annual survey released earlier this month, which revealed that the typical seller over the past year was in their home for 10 years before selling—an all-time survey high for tenure of home.

NAR also recently released its economic and housing forecast for 2015 and 2016. Yun is forecasting existing-home sales this year to fall slightly below 2013 (5.1 million) to 4.9 million, and then increase to 5.3 million next year and 5.4 million in 2016. Yun expects the national median existing-home price to rise 4 percent both next year and in 2016.

The PHSI in the Northeast inched 0.5 percent to 87.9 in October, and is now 3.4 percent above a year ago. In the Midwest the index slightly declined 0.6 percent to 100.6 in October, and is now 3.0 percent below October 2013.

Pending home sales in the South decreased 1.0 percent to an index of 118.3 in October, but is still 3.9 percent above last October. The index in the West fell 3.2 percent in October to 98.1, but remains 4.1 percent above a year ago.


DJ-BTMU U.S. Business Barometer rose by 0.4%
Posted: November 26, 2014 at 10:00 AM (Wednesday)

For the week ending November 15 2014, the DJ-BTMU U.S. Business Barometer rose by 0.4 percent to 98.6, extending the growing trend to two weeks. The biggest factor that contributed to the performance of this week’s barometer was MBA’s purchase index, which increased by a sharp 11.7 percent, following 1.1 percent in the prior week. As to the production side, all indexes except auto production reported gains, especially electric output, which climbed again by a solid 5.2 percent after growing 6.7 percent last week.

On a year-over-year basis, the barometer showed a gain of 0.8 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, increased by 0.1 percent to 98.3. Its year-over-year growth rate was 0.6 percent.


University of Michigan Consumer Confidence increased in November to 88.8
Posted: November 26, 2014 at 10:00 AM (Wednesday)

Consumer confidence posted its fourth consecutive monthly gain in November, rising to its highest level since July 2007. The November gain was due to improved personal finances as well as a more favorable outlook for employment. Importantly, consumers expressed much more favorable buying plans for durables and vehicles in the most recent survey. Favorable views toward purchases of large household durables were at their highest level since 2007, and favorable vehicle buying attitudes were the most favorable since 2005. Importantly, the gains in buying plans were due to large gains among younger and lower income households. These gains arrived just in time to boost holiday spending, and indicate that total consumer expenditures can be expected to increase by 2.9% in 2015.

Unemployment Expected to Decline
When consumers were asked about recent economic developments, job gains dominated all other news items, and when specifically asked, they anticipated the jobless rate to post additional declines during the year ahead. The job gains were attributed to a stronger pace of economic growth. Moreover, consumers voiced the most favorable long-term outlook for the economy since the last cyclical peak recorded in the January 2007 survey.

Higher Income Gains Expected
For the third consecutive month, consumers expected the largest income increases in six years. An annual gain of 1.1% was expected by all households, the largest anticipated increase since November 2008. Householders under the age of 45 expected the largest gains (4.2%), and even households in the bottom third of the income distribution anticipated twice as large a gain as in last month’s survey (0.8%, up from 0.4% in October).

The Consumer Sentiment Index was 88.8 in the November 2014 survey, up from 86.9 in October and 75.1 last November. The entire November gain was concentrated in the Current Conditions Index, which rose to 102.7 from 98.3 one month ago and 88.0 one year ago. The Expectations Index was largely unchanged at 79.9 in November, barely above the 79.6 in October, but substantially above last November’s 66.8.

In the past few years, renewed consumer optimism has been repeatedly thwarted by partisan bickering. The debt ceiling debacle, the fiscal cliff, and the government shutdown have repeatedly soured economic optimism. The renewed confidence consumers have expressed must be nurtured, not again held hostage to partisan differences. Based on recent data, consumer spending is poised to make 2015 the best year for the economy since 2005. To accomplish this outcome, the President and Congress must dial back the rhetoric and expand their common ground in promoting the continuation of robust gains in jobs and wages in the year ahead.


Chicago Purchasing Managers Index fell 5.4 points to 60.8 in November
Posted: November 26, 2014 at 09:45 AM (Wednesday)

The Chicago Business Barometer fell 5.4 points to 60.8 in November from a one year high of 66.2 in October driven by a double digit drop in New Orders.

The Barometer‘s decline reversed nearly all of October’s sharp increase, leaving it back close to the September level. All five components which contribute to the Barometer fell between October and November.

In spite of the slowdown, orders and output continued to expand at a healthy pace. Production, New Orders and the Barometer itself have been running above 60 for four months in a row, suggesting continued firm growth in the US economy.

New Orders decreased by 11.7 points to 61.9 in November having increased sharply to a one year high in October. Overall orders remain firm and barring a sharp fall in December are likely to record firmer growth in Q4 than Q3. While some panelists said November was steady compared with a month ago, others reported a busy period in the run up to Christmas.

Production also expanded at a slower rate, but was the strongest component of the Barometer in November. It’s currently running above both its 10-year average and the average for the past 12 months. In line with strong sales forecasts, companies built stocks at a slightly faster rate than in October but below September’s 41-year high. 66% of panellists reported that their current level of finished goods inventories was ‘about right‘ to keep up with demand.

Following the quicker pace of jobs growth in October, companies were less keen to hire in November. The Employment Indicator declined for the first time in three months to the lowest level since March. Supplier Deliveries declined for the second straight month after five months of lengthening, contributing negatively to the Barometer but giving some relief to business.

Following the sharp rise in the Barometer to a one year high in October it wasn’t too surprising to see activity ease somewhat in November. Overall the trend remains firm and activity looks set to pick up in Q4 from Q3.


Personal Income increased 0.2%, Spending increased 0.2%
Posted: November 26, 2014 at 08:30 AM (Wednesday)

Personal income increased $32.9 billion, or 0.2 percent, and disposable personal income (DPI) increased $23.4 billion, or 0.2 percent, in October, according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) increased $27.3 billion, or 0.2 percent. In September, personal income increased $24.6 billion, or 0.2 percent, DPI increased $17.2 billion, or 0.1 percent, and PCE increased $4.1 billion, or less than 0.1 percent, based on revised estimates.

Real DPI increased 0.1 percent in October, the same increase as in September. Real PCE increased 0.2 percent in October, in contrast to a decrease of less than 0.1 percent in September.


New Orders for Durable Goods Increased 0.4%, Ex-Trans Down 0.9%
Posted: November 26, 2014 at 08:30 AM (Wednesday)

New orders for manufactured durable goods in October increased $1.0 billion or 0.4 percent to $243.8 billion, the U.S. Census Bureau announced today. This increase, up following two consecutive monthly decreases, followed a 0.9 percent September decrease. Excluding transportation, new orders decreased 0.9 percent. Excluding defense, new orders decreased 0.6 percent. Transportation equipment, also up following two consecutive monthly decreases, drove the increase, $2.5 billion or 3.4 percent to $76.3 billion.

Shipments of manufactured durable goods in October, up four of the last five months, increased $0.3 billion or 0.1 percent to $246.5 billion. This followed a 0.3 percent September increase. Transportation equipment, also up four of the last five months, drove the increase, $0.4 billion or 0.5 percent to $72.9 billion.

Unfilled orders for manufactured durable goods in October, up eighteen of the last nineteen months, increased $5.0 billion or 0.4 percent to $1,174.0 billion. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.4 percent September increase. Transportation equipment, up thirteen of the last fourteen months, led the increase, $3.4 billion or 0.5 percent to $746.3 billion.

Inventories of manufactured durable goods in October, up eighteen of the last nineteen months, increased $2.0 billion or 0.5 percent to $406.8 billion. This was at the highest level since the series was first published on a NAICS basis and followed a 0.5 percent September increase. Transportation equipment, also up eighteen of the last nineteen months, led the increase, $0.9 billion or 0.7 percent to $131.7 billion.

Nondefense new orders for capital goods in October decreased $0.1 billion or 0.1 percent to $82.2 billion.Shipments decreased $0.6 billion or 0.8 percent to $80.1 billion. Unfilled orders increased $2.1 billion or 0.3 percent to $735.1 billion. Inventories increased $0.9 billion or 0.5 percent to $185.9 billion. Defense new orders for capital goods in October increased $1.1 billion or 11.2 percent to $10.5 billion. Shipments increased $0.1 billion or 1.4 percent to $9.8 billion. Unfilled orders increased $0.7 billion or 0.4 percent to $158.6 billion. Inventories increased $0.2 billion or 1.0 percent to $23.9 billion.

Revised seasonally adjusted September figures for all manufacturing industries were: new orders, $500.3 billion (revised from $499.4 billion); shipments, $503.7 billion (revised from $503.4 billion); unfilled orders, $1,169.1 billion (revised from $1,168.7 billion); and total inventories, $655.5 billion (revised from $655.2 billion).


Weekly Initial Unemployment Claims Increase 21,000 to 313,000
Posted: November 26, 2014 at 08:30 AM (Wednesday)

In the week ending November 22, the advance figure for seasonally adjusted initial claims was 313,000, an increase of 21,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 291,000 to 292,000. The 4-week moving average was 294,000, an increase of 6,250 from the previous week's revised average. The previous week's average was revised up by 250 from 287,500 to 287,750. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.7 percent for the week ending November 15, a decrease of 0.1 percentage point from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending November 15 was 2,316,000, a decrease of 17,000 from the previous week's revised level. This is the lowest level for insured unemployment since December 9, 2000 when it was 2,263,000. The previous week's level was revised up 3,000 from 2,330,000 to 2,333,000. The 4-week moving average was 2,352,000, a decrease of 17,750 from the previous week's revised average. This is the lowest level for this average since January 6, 2001 when it was 2,349,250. The previous week's average was revised up by 750 from 2,369,000 to 2,369,750.


Purchase Apps down, Refi's down in Latest MBA Weekly Survey
Posted: November 26, 2014 at 07:00 AM (Wednesday)

Mortgage applications decreased 4.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending November 21, 2014. The previous week’s results had included an adjustment for the Veterans Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, decreased 4.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 5 percent compared with the previous week. The Refinance Index decreased 4 percent from the previous week. The seasonally adjusted Purchase Index decreased 5 percent from one week earlier. The unadjusted Purchase Index increased 1 percent compared with the previous week and was 10 percent lower than the same week one year ago.

The refinance share of mortgage activity increased to 63 percent of total applications from 61 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.0 percent of total applications.

The FHA share of total applications decreased to 9.4 percent this week from 9.9 percent last week. The VA share of total applications decreased to 10.3 percent this week from 11.5 percent last week. The USDA share of total applications remained unchanged at 0.8 percent this week.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.15 percent from 4.18 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 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 4.10 percent, with points increasing to 0.25 from 0.16 (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 3.90 percent from 3.85 percent, with points decreasing to 0.13 from 0.18 (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 decreased to 3.35 percent from 3.38 percent, with points decreasing to 0.25 from 0.27 (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 3.06 percent from 3.09 percent, with points increasing to 0.41 from 0.34 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.


Richmond Fed's Current Activity Index dropped to a reading of 4
Posted: November 25, 2014 at 10:00 AM (Tuesday)

Fifth District manufacturing activity grew modestly in November, according to the most recent survey by the Federal Reserve Bank of Richmond. Shipments and the volume of new orders flattened this month, while manufacturing employment and average wage growth continued at a moderate pace. The average workweek lengthened at a slightly slower pace than a month ago.

Firms anticipated positive business conditions during the next six months, although expectations were less upbeat than a month ago. Manufacturers expected faster growth in shipments and in the volume of new orders compared to this month. Additionally, survey participants anticipated increased capacity utilization and expected order backlogs to grow more quickly. However, producers looked for little change in vendor lead times.

Manufacturers' outlook for the months ahead included faster growth in the number of employees and average wages than in the current month, with modest growth in the length of the average workweek.

Prices of raw materials and finished goods rose at a slower pace in November compared to last month. However, producers expected faster growth in prices paid and in prices received during the next six months.

Manufacturing activity slowed overall in November, with the composite index dropping to a reading of 4 from last month's reading of 20. Shipments and new orders changed little from a month ago; both indexes flattened to a reading of 1. Manufacturing hiring continued to grow at a moderate pace this month. The November indicator slipped four points to a reading of 10.

Capacity utilization grew at a steady pace this month. The index remained at 13 for a third consecutive month. Additionally, backlogs decreased this month, pulling the index down 11 points to −2. Vendor lead time lengthened at a slightly slower pace, moving the index to 7 from a reading of 12. Finished goods inventories rose more quickly than a month ago. The index gained five points to finish at 20. Additionally, raw materials inventories rose at a slightly faster rate compared to last month. That gauge moved up four points to end at 23.


Consumer Confidence decreased sharply in October to 88.7
Posted: November 25, 2014 at 10:00 AM (Tuesday)

The Conference Board Consumer Confidence Index®, which had rebounded in October, declined in November. The Index now stands at 88.7 (1985=100), down from 94.1 in October. The Present Situation Index declined from 94.4 to 91.3, while the Expectations Index decreased sharply to 87.0 from 93.8 in October.

Consumer confidence retreated in November, primarily due to reduced optimism in the short-term outlook. Consumers were somewhat less positive about current business conditions and the present state of the job market; moreover, their optimism in the short-term outlook in both areas has waned. However, income expectations were virtually unchanged and gas prices remain low, which should help boost holiday sales.

Consumers’ assessment of present-day conditions was moderately less favorable in November than in October. The proportion saying business conditions are “good” decreased from 24.7 percent to 24.0 percent, while those claiming business conditions are “bad” increased from 21.3 percent to 22.4 percent. Consumers’ assessment of the job market was slightly less favorable, with the proportion stating jobs are “plentiful” falling from 16.5 percent to 16.0 percent, and those claiming jobs are “hard to get” increasing marginally from 29.0 percent to 29.2 percent.

Consumers’ optimism, which had improved in October, retreated in November. The percentage of consumers expecting business conditions to improve over the next six months decreased from 19.4 percent to 17.6 percent, while those expecting business conditions to worsen rose from 8.9 percent to 10.7 percent. Consumers’ outlook for the labor market was also less optimistic. Those anticipating more jobs in the months ahead decreased from 16.0 percent to 15.0 percent, while those anticipating fewer jobs rose from 14.1 percent to 16.4 percent. The proportion of consumers expecting growth in their incomes edged down from 16.7 percent to 16.3 percent, while the proportion expecting a drop in income was virtually unchanged at 11.4 percent compared to 11.3 percent in October.


S&P/Case-Shiller Home Price Indices decrease 0.1% in September
Posted: November 25, 2014 at 09:00 AM (Tuesday)

S&P Dow Jones Indices today released the September 2014 index data for the S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices. Results show that home prices continue to decelerate. The 10-City Composite gained 4.8% year-over-year, down from 5.5% in August. The 20-City Composite gained 4.9% year-over-year, compared to 5.6% in August.

The National and Composite Indices were both slightly negative in September. Both the 10 and 20-City Composites reported a slight downturn while the National Index posted a -0.1% change for the month. Charlotte and Miami led all cities in September with increases of 0.6%. Atlanta and Washington D.C. offset those gains by reporting decreases of 0.3% and 0.4%.

The S&P/Case-Shiller U.S. National Home Price Index, which covers all nine U.S. census divisions, recorded a 4.8% annual gain in September 2014. The 10- and 20-City Composites reported year-over-year increases of 4.8% and 4.9%.

The overall trend in home price increases continues to slow down. The National Index reported a month-over-month decrease for the first time since November 2013. The Northeast region reported its first negative monthly returns since December 2013 and its worst annual returns since December 2012 due to weaknesses in Washington D.C. and Boston. The West and Southwest, previously strong regions, are seeing price gains fade. The only region showing any sustained strength is the Southeast led by Florida; price gains are also evident in Atlanta and Charlotte.

The 10- and 20-City Composites continued their year-over-year downward trend, gaining 4.8% and 4.9% compared to last month’s year-over-year gains of 5.6%. Las Vegas, which has shown double-digit annual gains, posted an annual return of 9.1%, its first time below 10% since October 2012. Miami, however, continues to impress with another double digit annual gain of 10.3%. It is the only city that currently has a year-over-year double digit gain. Charlotte was the only city in September to show an annual increase relative to last month. Eighteen of the 20 cities reported slower annual gains compared to last month.

Other housing statistics paint a mixed to slightly positive picture. Housing starts held above one million at annual rates on gains in single family homes, sales of existing homes are gaining, builders’ sentiment is improving, foreclosures continue to be worked off and mortgage default rates are at pre-crisis levels. With the economy looking better than a year ago, the housing outlook for 2015 is stable to slightly better.

As of September 2014, average home prices across the United States are back to their levels posted in the spring of 2005. The National Index was down 0.1% in September 2014 and 4.8% above September 2013.

As of September 2014, average home prices for the MSAs within the 10-City and 20-City Composites are back to their autumn 2004 levels. Measured from their June/July 2006 peaks, the peak-to-current decline for both Composites is approximately 15-17%. The recovery from the March 2012 lows is 28.8% and 29.6% for the 10-City and 20-City Composites.

Charlotte and Dallas were the only two cities to see their annual gains increase while Cleveland remained virtually unchanged for the fourth consecutive month. All other cities saw their annual gains decelerate. Miami continued to lead all cities with a 10.3% year-over-year gain. Detroit saw its gains drop to 5.0% from 6.7% the previous month.

September recorded mixed monthly figures. Nine cities recorded lower monthly figures while nine posted increases. Los Angeles and New York both reported flat monthly changes. Washington D.C. had the largest decrease of all 20 cities at 0.4% month-over-month.


3Q2014 GDP preliminary estimate increased 3.9%
Posted: November 25, 2014 at 08:30 AM (Tuesday)

Real gross domestic product -- the value of the production of goods and services in the United States, adjusted for price changes -- increased at an annual rate of 3.9 percent in the third quarter of 2014, according to the "second" estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 4.6 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 3.5 percent. With the second estimate for the third quarter, private inventory investment decreased less than previously estimated, and both personal consumption expenditures (PCE) and nonresidential fixed investment increased more. In contrast, exports increased less than previously estimated.

The increase in real GDP in the third quarter reflected positive contributions from PCE, nonresidential fixed investment, federal government spending, exports, residential fixed investment, and state and local government spending that were partly offset by a negative contribution from private inventory investment. Imports, which are a subtraction in the calculation of GDP, decreased.

The deceleration in the percent change in real GDP reflected a downturn in private inventory investment and decelerations in exports, in nonresidential fixed investment, in state and local government spending, in PCE, and in residential fixed investment that were partly offset by a downturn in imports and an upturn in federal government spending.

The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 1.4 percent in the third quarter, 0.1 percentage point more than in the advance estimate; this index increased 2.0 percent in the second quarter. Excluding food and energy prices, the price index for gross domestic purchases increased 1.6 percent in the third quarter, compared with an increase of 1.7 percent in the second.


ICSC Chain Store Sales increased by 2.2% in Nov 22 Wk
Posted: November 25, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 1.7% for the week ending November 22 - relative to the prior year. On a week-over-week basis, sales increased rapidly by 2.2%.

"Early Black Friday promotions helped propel sales on a week-over-week basis," said Michael Niemira, ICSC research consultant. "Weather was a bit of a mixed-bag over the past week for retailers as colder weather got the consumer in the winter apparel mindset - however extreme weather in some parts of the country curbed consumers' ability and desire to shop," he added.


Texas Manufacturing Activity Posts Slower Growth
Posted: November 24, 2014 at 10:30 AM (Monday)

Texas factory activity increased again in November, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, fell from 13.7 to 6, indicating output growth slowed in November.

Other measures of current manufacturing activity also reflected slower growth during the month. The capacity utilization index fell sharply from 18.1 to 9.8. The new orders index also declined notably from 14.2 to 5.6, although more than a quarter of firms continued to note increases in new orders over October levels. The shipments index was 12.1, nearly unchanged from its October reading.

Perceptions of broader business conditions remained positive this month, while outlooks were less optimistic. The general business activity index held steady at a solid reading of 10.5. The company outlook index dropped from 18.2 to 8.8, due to a smaller share of firms noting an improved outlook in November than in October.

Labor market indicators reflected continued employment growth and longer workweeks. The November employment index posted a sixth robust reading, coming in at 9.6. Twenty-one percent of firms reported net hiring, compared with 11 percent reporting net layoffs. The hours worked index slipped from 8.3 to 5.7, indicating a smaller increase in hours worked than last month.

Upward pressures on wages and prices were mixed. The raw materials prices index fell from 19.7 to 15.3, its lowest reading in seven months. The finished goods prices index edged up from 7.1 to 9.7. The wages and benefits index was little changed, at a reading of 23.9, with 76 percent of manufacturers noting no change in wages and benefits this month.

Expectations regarding future business conditions remained optimistic in November. The index of future general business activity rose 5 points to 18.3, while the index of future company outlook held steady at 23.1. Indexes for future manufacturing activity held steady or improved in November.


Chicago Fed National Activity moderated in October
Posted: November 24, 2014 at 08:30 AM (Monday)

Led by declines in production-related indicators, the Chicago Fed National Activity Index (CFNAI) moved down to +0.14 in October from +0.29 in September. Two of the four broad categories of indicators that make up the index decreased from September, and two of the four categories made negative contributions to the index in October.

The index’s three-month moving average, CFNAI-MA3, declined to –0.01 in October from +0.12 in September. October’s CFNAI-MA3 suggests that growth in national economic activity was near 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, decreased to +0.11 in October from +0.16 in September. Forty-nine of the 85 individual indicators made positive contributions to the CFNAI in October, while 36 made negative contributions. Thirty-six indicators improved from September to October, while 49 indicators deteriorated. Of the indicators that improved, seven made negative contributions.

Production-related indicators made a contribution of –0.01 to the CFNAI in October, down from +0.18 in September. Industrial production decreased 0.1 percent in October after rising 0.8 percent in September, and manufacturing production increased 0.2 percent in October for the second straight month.
Employment-related indicators contributed +0.16 to the CFNAI in October, down somewhat from +0.22 in September. The unemployment rate declined to 5.8 percent in October from 5.9 percent in September; however, nonfarm payrolls increased by 214,000 in October, down from a gain of 256,000 in the previous month.

The contribution of the sales, orders, and inventories category to the CFNAI rose to +0.11 in October from +0.06 in September. The Institute for Supply Management’s Manufacturing Purchasing Managers’ New Orders Index rose to 65.8 in October from 60.0 in the previous month.

The contribution of the consumption and housing category to the CFNAI increased to –0.12 in October from –0.17 in September. Housing permits increased to 1,080,000 annualized units in October from 1,031,000 in September. However, housing starts decreased to 1,009,000 annualized units in October from 1,038,000 in the previous month.

The CFNAI was constructed using data available as of November 20, 2014. At that time, October data for 51 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The September monthly index was revised to +0.29 from an initial estimate of +0.47, and the August monthly index was revised to –0.46 from last month’s estimate of –0.25. 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 revisions to both the September and August monthly indexes were due primarily to the latter.


Kansas City Fed Manufacturing Activity expanded at a slightly faster pace in Nov
Posted: November 21, 2014 at 11:00 AM (Friday)

Tenth District manufacturing activity expanded at a slightly faster pace in November, and producers’ expectations for future activity increased further. Firms reported rising difficulties in attracting and retaining certain key workers, and several contacts cited increased labor costs. Price indexes were mixed with little change overall.

The month-over-month composite index was 7 in November, up from 4 in October and 6 in September. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Producers of aircraft parts and equipment reported the strongest growth, while contacts at plastics and chemical plants reported a decline in activity. Most other month-over-month indexes were also higher than last month.

The production index rose from 3 to 9, and the shipments, employment, and new orders for exports indexes also increased. The order backlog index moved into positive territory for the first time in four months, while the new orders index was basically unchanged. The finished goods inventory index jumped from -5 to 4, and the raw materials inventory index increased for the second straight month.

Most year-over-year factory indexes moderated somewhat. The composite year-over-year index fell from 17 to 9, and the production, shipments, and new orders indexes also moved lower. The employment index decreased from 16 to 10, and the capital expenditures index edged down after rising last month. In contrast, the order backlog index improved from 6 to 10, and the new orders for exports index moved into positive territory. Both inventory indexes fell further.

Future factory indexes strengthened further in November. The future composite index moved higher from 17 to 22, and the future production, shipments, and order backlog indexes also rose. The future employment index jumped from 16 to 31, its highest level in almost nine years. In contrast, the future new orders index eased from 26 to 24, and the future capital expenditures index also edged lower. The future finished goods inventory index decreased from 12 to 9, while the future raw materials inventory index was basically unchanged.

Price indexes were mixed with little change overall. The month-over-month raw materials price index decreased from 17 to 12, while the finished goods price index increased slightly. The year-over-year raw materials price index inched higher from 44 to 46, while the finished goods price index was basically unchanged. The future raw materials price index eased from 38 to 33, while the future finished goods price index ticked up somewhat, indicating more firms plan to pass recent cost increases through to customers.


DJ-BTMU U.S. Business Barometer picked up by 0.3%
Posted: November 20, 2014 at 02:01 PM (Thursday)

For the week ending November 8 2014, the DJ-BTMU U.S. Business Barometer picked up by 0.3 percent to 98.2, after several weeks of weak trend. The recovery in this week’s barometer was driven by both consumption and production indexes. Chain store sales bounced back by 1.5 percent following a 1.6 percent drop in the last week. MBA’s purchase index also rose by 1.1 percent. As to the production side, electric output and truck production posted the largest increases, with rates of 6.7 and 4.2 percent, respectively.

On a year-over-year basis, the barometer showed a gain of 0.9 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 98.1. Its year-over-year growth rate was 0.6 percent.


U.S. Leading Economic Index increased 0.9%
Posted: November 20, 2014 at 10:00 AM (Thursday)

The Conference Board Leading Economic Index® (LEI) for the U.S. increased 0.9 percent in October to 105.2 (2004 = 100), following a 0.7 percent increase in September, and no change in August.

The LEI rose sharply in October, with all components gaining over the previous six months. Despite a negative contribution from stock prices in October, and minimal contributions from new orders for consumer goods and average workweek in manufacturing, the LEI suggests the U.S. expansion continues to be strong.

The upward trend in the LEI points to continued economic growth through the holiday season and into early 2015. This is consistent with our outlook for relatively good, but not great, consumer demand over the near term. Going forward, there are continued concerns about slow business investment and lackluster income growth.

The Conference Board Coincident Economic Index® (CEI) for the U.S. increased 0.1 percent in October to 110.2 (2004 = 100), following a 0.3 percent increase in September, and a 0.1 percent increase in August.

The Conference Board Lagging Economic Index® (LAG) for the U.S. declined 0.1 percent in October to 124.9 (2004 = 100), following a 0.1 percent increase in September, and a 0.5 percent increase in August.


Existing-Home Sales increased 1.5 in October
Posted: November 20, 2014 at 10:00 AM (Thursday)

Existing-home sales rose in October for the second straight month and are now above year-over-year levels for the first time in a year, 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 1.5 percent to a seasonally adjusted annual rate of 5.26 million in October from an upwardly-revised 5.18 million in September. Sales are at their highest annual pace since September 2013 (also 5.26 million) and are now above year-over-year levels (2.5 percent from last October) for the first time since last October.

Lawrence Yun, NAR chief economist, says the housing market this year has been a tale of two halves. “Sales activity in October reached its highest annual pace of the year as buyers continue to be encouraged by interest rates at lows not seen since last summer, improving levels of inventory and stabilizing price growth,” he said. “Furthermore, the job market has shown continued strength in the past six months. This bodes well for solid demand to close out the year and the likelihood of additional months of year-over-year sales increases.”

The median existing-home price for all housing types in October was $208,300, which is 5.5 percent above October 2013. This marks the 32nd consecutive month of year-over-year price gains.

Total housing inventory at the end of October fell 2.6 percent to 2.22 million existing homes available for sale, which represents a 5.1-month supply at the current sales pace – the lowest since March (also 5.1 months). Unsold inventory is now 5.2 percent higher than a year ago, when there were 2.11 million existing homes available for sale.

“The growth in housing supply this year will likely prevent the drastic sales slowdown and coinciding spike in home prices we saw last winter due to low inventory,” says Yun. “However, more housing starts are needed to increase supply, meet current demand and keep price growth in check.”

All-cash sales were 27 percent of transactions in October, up from 24 percent in September but down from 31 percent in October of last year. Individual investors, who account for many cash sales, purchased 15 percent of homes in October, up from 14 percent last month but below October 2013 (19 percent). Sixty-five percent of investors paid cash in October.

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage in October dropped to 4.03 percent, its lowest level since June 2013 (4.07 percent), and down from 4.16 percent in September.

The percent share of first-time buyers in October remained at 29 percent for the fourth consecutive month; first-time buyers have represented less than 30 percent of all buyers in 18 of the past 19 months. A separate NAR survey released earlier this month revealed that the annual share of first-time buyers fell to its lowest level in nearly three decades.

Distressed homes – foreclosures and short sales – were in the single-digits for the third month this year, decreasing to 9 percent in October from 10 percent in September; they were 14 percent a year ago. Seven percent of October sales were foreclosures and 2 percent were short sales. Foreclosures sold for an average discount of 15 percent below market value in October (14 percent in September), while short sales were discounted 10 percent (14 percent in September).

“Although distressed sales are trending downward, there are still areas (such as judicial states Florida, Maryland and New York) plagued by foreclosures, and homeowners faced with the awful choice between a tax bill they are unable to pay and losing their home,” says NAR President Chris Polychron, executive broker with 1st Choice Realty in Hot Springs, Ark. “Realtors® urge the U.S. House to schedule a vote on “The Mortgage Forgiveness Tax Relief Act,” as soon as possible. This bipartisan legislation would extend an expired provision that has helped millions of distressed American families by allowing tax relief when lenders forgive a portion of the mortgage debt they owe.”

Properties typically stayed on the market in October longer (63 days) than last month (56 days) and a year ago (54 days). Short sales were on the market for a median of 150 days in October, while foreclosures sold in 68 days and non-distressed homes took 61 days. Thirty-three percent of homes sold in October were on the market for less than a month.

Single-family home sales increased 1.3 percent to a seasonally adjusted annual rate of 4.63 million in October from 4.57 million in September, and are now 2.9 percent above the 4.50 million pace a year ago. The median existing single-family home price was $208,700 in October, up 5.6 percent from October 2013.

Existing condominium and co-op sales increased 3.3 percent to a seasonally adjusted annual rate of 630,000 units in October from 610,000 in September, unchanged from the 630,000 unit pace a year ago. The median existing condo price was $205,400 in October, which is 4.5 percent higher than a year ago.


Philadelphia November Outlook Suggest Pickup in Growth
Posted: November 20, 2014 at 10:00 AM (Thursday)

The survey’s broadest measure of manufacturing conditions, the diffusion index of current activity, increased from 20.7 in October to 40.8 this month and has now been positive for nine consecutive months. This was the highest reading since December 1993. The percentage of firms reporting increased activity this month (49 percent) was significantly greater than the percentage reporting decreased activity (9 percent).

Both the current new orders and shipments indexes rose from their readings in October. The current new orders index, which reflects the demand for manufactured goods, increased 18 points, to 35.7. Over 44 percent of the firms reported a rise in new orders, compared with 36 percent last month.

Labor market indicators showed improvement this month. The current employment index rose 10 points in November, to 22.4, and hit a 3½ year high. Twenty-nine percent of the firms reported increases in employment compared with 20 percent that reported increased employment last month. Firms also reported higher work hours, with the average workweek index rising from -1.3 to 7.8 this month.

Price Indexes Moderate
Both the prices paid and prices received diffusion indexes moderated this month. Input price pressures were reported to be less than last month: The prices paid index fell 10 points to 17.3 this month. Twenty-one percent of the firms reported higher prices paid this month compared with 29 percent last month. Reflecting the prices of their own manufactured goods, the prices received index decreased 9 points from October. The percent of firms reporting higher prices (19 percent) exceeded the percentage reporting lower prices (8 percent), but 72 percent of the firms reported steady prices.

Six-Month Indicators Reflect Continued Optimism
The survey’s future indicators suggest optimism for continued growth. This month, the future general activity index rose 3 points, to 57.7 (see Chart). Nearly 60 percent of the firms expect increases in activity over the next six months; only 2 percent of the firms indicated that they expect decreases over the next six months. The indexes for future new orders and shipments also remained at relatively high levels but fell slightly. The future employment index rose almost 4 points to 31.5, with nearly 40 percent of the firms expecting to increase employment over the next six months.

Special Questions Show Improved Employment Plans
In special questions this month, manufacturers were asked to provide details about expected changes in employment over the next 12 months, including factors influencing these changes. Nearly 56 percent of the firms expect to increase their employment over the next 12 months (see Special Questions). This represents a steady increase since January 2013. When firms were asked to rank the three most important factors influencing their future hiring plans, expected sales growth was the most cited factor and also deemed the most important individual factor. The need for skills not possessed by current staff and having an overworked current staff were the next highest ranked factors influencing hiring plans. When asked about factors restraining hiring plans, “to keep operating costs low” was the most cited among the top three factors, but “cannot find workers with required skills” was the most frequently cited most important factor. Firms were also asked about how the Affordable Care Act was influencing their plans for hiring: Seventy percent of the firms indicated that no changes were made in overall staffing because of the law; 11 percent of the firms indicated that they had reduced full-time hiring; 8 percent indicated that they have increased the use of contract workers. Almost 8 percent of the firms were not affected by the employer mandate.

Summary
The November Manufacturing Business Outlook Survey indicated a pickup in the growth of the region’s manufacturing sector. Firms reported continued increases in overall activity, new orders, shipments, and employment this month. The survey’s future activity indexes remained at high readings, suggesting continued optimism about manufacturing growth. Firms were more optimistic about employment increases over the next six to 12 months.


Weekly Initial Unemployment Claims Decrease 2,000 to 291,000
Posted: November 20, 2014 at 08:30 AM (Thursday)

In the week ending November 15, the advance figure for seasonally adjusted initial claims was 291,000, a decrease of 2,000 from the previous week's revised level. The previous week's level was revised up by 3,000 from 290,000 to 293,000. The 4-week moving average was 287,500, an increase of 1,750 from the previous week's revised average. The previous week's average was revised up by 750 from 285,000 to 285,750. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.8 percent for the week ending November 8, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending November 8 was 2,330,000, a decrease of 73,000 from the previous week's revised level. This is the lowest level for insured unemployment since December 16, 2000 when it was 2,322,000. The previous week's level was revised up 11,000 from 2,392,000 to 2,403,000. The 4-week moving average was 2,369,000, a decrease of 6,250 from the previous week's revised average. This is the lowest level for this average since January 13, 2001 when it was 2,360,500. The previous week's average was revised up by 2,750 from 2,372,500 to 2,375,250.


Consumer Price Index unch% in October, Ex Fd & Engy up 0.2%
Posted: November 20, 2014 at 08:30 AM (Thursday)

The Consumer Price Index for All Urban Consumers (CPI-U) was unchanged in October on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 1.7 percent before seasonal adjustment.

Gasoline and other energy indexes declined, offsetting increases in shelter and an array of other indexes to leave the seasonally adjusted all items index unchanged. The gasoline index fell for the fourth month in a row, declining 3.0 percent, and the indexes for natural gas and fuel oil also decreased. The food index rose slightly in October, with major grocery store food groups mixed.

The index for all items less food and energy increased 0.2 percent in October. Besides the shelter index, airline fares, household furnishings and operations, medical care, recreation, personal care, tobacco, and new vehicles were among the indexes that increased. The indexes for used cars and trucks and for apparel declined in October.

The all items index increased 1.7 percent over the last 12 months, the same increase as for the 12 months ending September. The index for all items less food and energy increased 1.8 percent over the span, and the food index rose 3.1 percent. In contrast, the energy index declined 1.6 percent over the last 12 months.


Real Average Hourly Earnings rose 0.1% in October
Posted: November 20, 2014 at 08:30 AM (Thursday)

Real average hourly earnings for all employees rose 0.1 percent from September to October, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This result stems from a 0.1 percent increase in average hourly earnings combined with no change in the Consumer Price Index for All Urban Consumers (CPI-U).

Real average weekly earnings increased 0.4 percent over the month due to the increase in real average hourly earnings combined with a 0.3 percent increase in the average workweek.

Real average hourly earnings increased 0.4 percent, seasonally adjusted, from October 2013 to October 2014. This increase in real average hourly earnings, combined with a 0.6 percent increase in the average workweek, resulted in a 0.9 percent increase in real average weekly earnings over this period.


October Housing Starts down 2.8%, Permits up 4.8%
Posted: November 19, 2014 at 08:30 AM (Wednesday)

BUILDING PERMITS
Privately-owned housing units authorized by building permits in October were at a seasonally adjusted annual rate of 1,080,000. This is 4.8 percent (±1.3%) above the revised September rate of 1,031,000 and is 1.2 percent (±1.2%) above the October 2013 estimate of 1,067,000. Single-family authorizations in October were at a rate of 640,000; this is 1.4 percent (±1.2%) above the revised September figure of 631,000. Authorizations of units in buildings with five units or more were at a rate of 406,000 in October.

HOUSING STARTS
Privately-owned housing starts in October were at a seasonally adjusted annual rate of 1,009,000. This is 2.8 percent (±10.0%) below the revised September estimate of 1,038,000, but is 7.8 percent (±8.7%) above the October 2013 rate of 936,000. Single-family housing starts in October were at a rate of 696,000; this is 4.2 percent (±8.8%) above the revised September figure of 668,000. The October rate for units in buildings with five units or more was 300,000.

HOUSING COMPLETIONS
Privately-owned housing completions in October were at a seasonally adjusted annual rate of 881,000. This is 8.8 percent (±14.7%) below the revised September estimate of 966,000, but is 8.1 percent (±13.0%) above the October 2013 rate of 815,000.


Purchase Apps up, Refi's up in Latest MBA Weekly Survey
Posted: November 19, 2014 at 07:00 AM (Wednesday)

Mortgage applications increased 4.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending November 14, 2014. This week’s results included an adjustment for the Veterans Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 4.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 7 percent compared with the previous week. The Refinance Index increased 1 percent from the previous week. The seasonally adjusted Purchase Index increased 12 percent from one week earlier to the highest level since July 2014. The unadjusted Purchase Index decreased 3 percent compared with the previous week and was 6 percent lower than the same week one year ago.

The refinance share of mortgage activity decreased to 61 percent of total applications from 63 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 6.9 percent of total applications.

The FHA share of total applications increased to 9.9 percent this week from 9.6 percent last week. The VA share of total applications increased to 11.5 percent this week from 11.0 percent last week. The USDA share of total applications fell to 0.8 percent this week from 0.9 percent last week.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.18 percent from 4.19 percent, with points decreasing to 0.24 from 0.26 (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 4.10 percent from 4.13 percent, with points increasing to 0.16 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 30-year fixed-rate mortgages backed by the FHA decreased to 3.85 percent from 3.90 percent, with points increasing to 0.18 from 0.14 (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 from 3.38 percent, with points increasing to 0.27 from 0.22 (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 3.09 percent from 3.05 percent, with points increasing to 0.34 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.


Treasury International Capital Data for September 2014
Posted: November 18, 2014 at 04:00 PM (Tuesday)

The U.S. Department of the Treasury today released Treasury International Capital (TIC) data for September 2014. The sum total in September of all net foreign acquisitions of long-term securities, short-term U.S. securities, and banking flows was a monthly net TIC outflow of $55.6 billion. Of this, net foreign private outflows were $46.1 billion, and net foreign official outflows were $9.5 billion.

Foreign residents increased their holdings of long-term U.S. securities in September; net purchases were $94.2 billion. Net purchases by private foreign investors were $80.5 billion, while net purchases by foreign official institutions were $13.7 billion. U.S. residents decreased their holdings of long-term foreign securities, with net sales of $70.1billion.

Taking into account transactions in both foreign and U.S. securities, net foreign purchases of long-term securities were $164.3 billion. After including adjustments, such as estimates of unrecorded principal payments to foreigners on U.S. asset-backed securities, overall net foreign purchases of long-term securities are estimated to have been $152.7 billion in September.

Foreign residents decreased their holdings of U.S. Treasury bills by $16.2 billion. Foreign resident holdings of all dollar-denominated short-term U.S. securities and other custody liabilities decreased by $22.2 billion. Banks' own net dollar-denominated liabilities to foreign residents decreased by $186.1 billion.


Builder Confidence rose 4 points in November to 58
Posted: November 18, 2014 at 10:00 AM (Tuesday)

Builder confidence in the market for newly built single-family homes rose four points to a level of 58 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today.

Growing confidence among consumers is what’s fueling this optimism among builders. Members in many areas of the country continue to see increasing buyer traffic and signed contracts.

Low interest rates, affordable home prices and solid job creation are contributing to a steady housing recovery. After a slow start to the year, the HMI has remained above the 50-point benchmark for five consecutive months, and we expect the momentum to continue into 2015.”

All three HMI components increased in November. The index gauging current sales conditions rose five points to 62, while the index measuring expectations for future sales moved up two points to 66 and the index gauging traffic of prospective buyers increased four points to 45.

Looking at the three-month moving averages for regional HMI scores, the Northeast rose three points to 44, the South posted a four-point gain to 62, and the West edged up one point to 58. The Midwest registered a two-point loss to 57.


Producer Price Index rose 0.2% in October, ex Fd & Engy down 0.1%
Posted: November 18, 2014 at 08:30 AM (Tuesday)

The Producer Price Index for final demand rose 0.2 percent in October, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This increase followed a 0.1-percent decline in September and no change in August. On an unadjusted basis, the index for final demand advanced 1.5 percent for the 12 months ended in October, the smallest 12-month increase since a 1.2-percent rise in February 2014.

In October, the 0.2-percent rise in final demand prices can be traced to the index for final demand services, which advanced 0.5 percent. In contrast, prices for final demand goods moved down 0.4 percent.

Within intermediate demand, prices for processed goods declined 0.9 percent, the index for unprocessed goods fell 2.4 percent, and prices for services inched up 0.1 percent.


ICSC Chain Store Sales increased by 0.2% in Nov 15 Wk
Posted: November 18, 2014 at 07:45 AM (Tuesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 2.2% for the week ending November 15 - relative to the prior year. On a week-over-week basis, sales increased by 0.2%.

"Gas prices have declined by 81 cents per gallon since early July - which I estimate has saved consumers around $90 billion of expenditure at an annual rate," said Michael Niemira, ICSC research consultant. "The savings should help lift holiday sales," he added.


Forecasters Steady Outlook for Growth with Improved Outlook for Labor Market
Posted: November 17, 2014 at 10:00 AM (Monday)

The outlook for growth in the U.S. economy over the next four years is little changed from the survey of three months ago, according to 42 forecasters surveyed by the Federal Reserve Bank of Philadelphia. The forecasters predict real GDP will grow at an annual rate of 2.7 percent this quarter and 2.8 percent next quarter. On an annual-average over annual-average basis, real GDP will grow 2.2 percent in 2014, up slightly from the previous estimate of 2.1 percent. The forecasters predict real GDP will grow 3.0 percent in 2015, 2.9 percent in 2016, and 2.7 percent in 2017.

An improved outlook for the unemployment rate accompanies the outlook for growth. The forecasters predict the unemployment rate will be an annual average of 6.2 percent in 2014, before falling to 5.6 percent in 2015, 5.4 percent in 2016, and 5.2 percent in 2017. The projections for 2014, 2015, and 2017 are a little below those of the last survey. The projection for 2016 remains unchanged.

On the jobs front, the panelists have revised upward their estimates for job gains in the next two quarters. The forecasters see nonfarm payroll employment growing at a rate of 221,600 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 206,400 in 2014 and 212,300 in 2015, as the table below shows.


Industrial Production edged down 0.1%
Capacity Utilization decreased 0.3% to 78.9%

Posted: November 17, 2014 at 09:15 AM (Monday)

Industrial production edged down 0.1 percent in October after having advanced 0.8 percent in September. In October, manufacturing output increased 0.2 percent for the second consecutive month. The index for mining declined 0.9 percent and the output of utilities moved down 0.7 percent. At 104.9 percent of its 2007 average, total industrial production in October was 4.0 percent above its level of a year earlier. Capacity utilization for the industrial sector decreased 0.3 percentage point in October to 78.9 percent, a rate that is 1.2 percentage points below its long-run (1972–2013) average.


Empire State Manufacturing Survey Conditions continue to expand
Posted: November 17, 2014 at 08:30 AM (Monday)

The November 2014 Empire State Manufacturing Survey indicates that business activity continued to expand for New York manufacturers. The headline general business conditions index climbed four points to 10.2, indicating a pace of growth somewhat faster than last month’s. The new orders index rose eleven points to 9.1, and the shipments index advanced eleven points to 11.8. The index for number of employees edged down to 8.5 but remained positive, indicating that employment levels grew; the average workweek index, by contrast, was negative, pointing to a decline in hours worked. After falling sharply last month, the prices paid index was little changed at 10.6—a sign that input prices had increased only modestly. The prices received index fell to zero, indicating that selling prices were flat. Indexes for the six-month outlook were generally higher this month and conveyed a strong degree of optimism about future business conditions.

Business Conditions Continue to Improve
Rising four points to 10.2, the general business conditions index signaled that business activity continued to expand for New York manufacturers in November, and at a somewhat faster pace than last month. Nonetheless, the October and November readings for this index point to a downshift in the pace of growth compared with the May-September period, when the index averaged around 20. About 35 percent of respondents reported that conditions had improved over the month, while 24 percent reported that conditions had worsened. The new orders index bounced back into positive territory after dipping below zero last month; its eleven-point rise, to 9.1, pointed to a modest increase in orders. The shipments index also recovered from a sharp decline last month, climbing eleven points to 11.8. The unfilled orders index remained negative, falling three points to -7.5. The delivery time index, down four points to -9.6, indicated that delivery times were shorter, and the inventories index, at zero, suggested that inventory levels were unchanged.

Selling Prices Flat This Month
The prices paid index inched down to 10.6, its lowest level in more than two years, pointing to a fairly slow pace of growth in input prices. The prices received index recorded its lowest reading in a year, falling seven points to zero in a sign that selling prices were flat. The index for number of employees edged down to 8.5, indicating a modest increase in employment levels. At -7.5, the average workweek index reflected a decline in hours worked for a second consecutive month.

Optimism about Future Conditions Remains Strong
Indexes assessing the six-month outlook generally rose this month, and conveyed considerable optimism about future business activity. The index for future general business conditions climbed six points to 47.6, its highest level since January 2012. The future new orders index rose five points to 47.0, and the future shipments index rose two points to 44.7. The index for expected number of employees jumped twelve points to 24.5, and the future average workweek index advanced to 8.5. The capital expenditures index moved up six points to 27.7, its highest level in more than two years, and the technology spending index rose to 19.2.


Business Inventories up 0.3% in September
Posted: November 14, 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 September, adjusted for seasonal and trading-day differences but not for price changes, was estimated at $1,352.5 billion, virtually unchanged (±0.3%)* from August 2014, but were up 4.1 percent (±0.6%) from September 2013.

Manufacturers’ and trade inventories, adjusted for seasonal variations but not for price changes, were estimated at an end-of-month level of $1,756.1 billion, up 0.3 percent (±0.1%) from August 2014 and up 5.3 percent (±0.5%) from September 2013.

The total business inventories/sales ratio based on seasonally adjusted data at the end of September was 1.30. The September 2013 ratio was 1.28.


U.S. Import Price Index declined 1.3% in October
Posted: November 14, 2014 at 08:30 AM (Friday)

The price index for U.S. imports decreased 1.3 percent in October following a 0.6-percent decline in September, the U.S. Bureau of Labor Statistics reported today. The October drop was mostly led by falling fuel prices. U.S. export prices declined 1.0 percent in October, after falling 0.4 percent in September and 0.5 percent in August.


U.S. Retail Sales for August increase 0.3%, Ex-Auto up 0.3%
Posted: November 14, 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 October, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $444.5 billion, an increase of 0.3 percent (±0.5%) from the previous month, and 4.1 percent (±0.9%) above October 2013. Total sales for the August through October 2014 period were up 4.5 percent (±0.7%) from the same period a year ago. The August to September 2014 percent change was unrevised from -0.3% (±0.2%).

Retail trade sales were up 0.3 percent (±0.5%) from September 2014, and 3.8 percent (±0.7%) above last year. Nonstore retailers were up 9.1 percent (±2.1%) from October 2013 and auto and other motor vehicle dealers were up 8.3 percent (±3.0%) from last year.


Job Openings were 4.7 million in September
Posted: November 13, 2014 at 10:00 AM (Thursday)

There were 4.7 million job openings on the last business day of September, little changed from 4.9 million in August, the U.S. Bureau of Labor Statistics reported today. Hires (5.0 million) and separations (4.8 million) increased in September. Within separations, the quits rate (2.0 percent) increased and the layoffs and discharges rate (1.2 percent) was 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 September. The job openings rate was 3.3 percent. The number of job openings was little changed for total private and government in September. The level of job openings decreased for arts, entertainment, and recreation. The job openings level was little changed in all four regions.

The number of job openings (not seasonally adjusted) increased over the 12 months ending in September for total nonfarm, total private, and government. The job openings level increased over the year for many industries, including both professional and business services and health care and social assistance. The number of openings also increased over the year in all four regions.


DJ-BTMU U.S. Business Barometer slipped by 0.2%
Posted: November 13, 2014 at 10:00 AM (Thursday)

For the week ending November 1 2014, the DJ-BTMU U.S. Business Barometer slipped by 0.2 percent to 97.9, falling to its lowest level since June 2014. The biggest factor that contributed to this week’s barometer was chain store sales, which dipped by 1.6 percent, mainly owing to a big falloff in furniture stores and a moderate decline in office and grocery stores. However, this tumble was partially offset by gains in other indexes. For instance, MBA’s purchase index rose by 2.6 percent, while electric output picked up by 1.7 percent.

On a year-over-year basis, the barometer showed a gain of 0.6 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 0.1 percent to 98.0. Its year-over-year growth rate was 0.6 percent.


Weekly Initial Unemployment Claims Increase 12,000 to 290,000
Posted: November 13, 2014 at 08:30 AM (Thursday)

In the week ending November 8, the advance figure for seasonally adjusted initial claims was 290,000, an increase of 12,000 from the previous week's unrevised level of 278,000. The 4-week moving average was 285,000, an increase of 6,000 from the previous week's unrevised average of 279,000. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.8 percent for the week ending November 1, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending November 1 was 2,392,000, an increase of 36,000 from the previous week's revised level. The previous week's level was revised up 8,000 from 2,348,000 to 2,356,000. The 4-week moving average was 2,372,500, an increase of 750 from the previous week's revised average. The previous week's average was revised up by 2,000 from 2,369,750 to 2,371,750.


Wholesale Inventories up 0.3% in September
Posted: November 12, 2014 at 10:00 AM (Wednesday)

The U.S. Census Bureau announced today that September 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 $454.3 billion, up 0.2 percent (+/-0.9)* from the revised August level and were up 5.2 percent (+/-1.6%) from the September 2013 level. The August preliminary estimate was revised downward $0.4 billion or 0.1 percent. September sales of durable goods were up 0.5 percent (+/-0.9%)* from last month and were up 5.4 percent (+/-1.6%) from a year ago. Sales of hardware and plumbing and heating equipment and supplies were up 4.8 percent from last month and sales of lumber and other construction materials were up 1.8 percent. Sales of nondurable goods were down 0.1 percent (+/-1.4%)* from August, but were up 5.1 percent (+/-3.0%) from last September. Sales of paper and paper products were down 2.6 percent from last month, while sales of apparel, piece goods, and notions were up 4.0 percent.

Total inventories of merchant wholesalers, except manufacturers’ sales branches and offices, after adjustment for seasonal variations but not for price changes, were $538.8 billion at the end of September, up 0.3 percent (+/-0.4%)* from the revised August level and were up 7.4 percent (+/-0.9%) from the September 2013 level. The August preliminary estimate was revised downward $0.6 billion or 0.1 percent. September inventories of durable goods were up 0.8 percent (+/-0.4%) from last month and were up 9.0 percent (+/-1.4%) from a year ago. Inventories of computer and computer peripheral equipment and software were up 3.4 percent from last month and inventories of metals and minerals, except petroleum, were up 1.8 percent. Inventories of nondurable goods were were down 0.6% (+/-0.4%) from August, but were up 4.9 percent (+/-0.7%) from last September. Inventories of petroleum and petroleum products were down 5.3 percent from last month and inventories of farm product raw materials were down 3.0 percent.

The Septmber inventories/sales ratio for merchant wholesalers, except manufacturers’ sales branches and offices, based on seasonally adjusted data, was 1.19. The September 2013 ratio was 1.16.


NFIB Small Business Optimism Index gained 0.8 points to 96.1
Posted: November 12, 2014 at 07:30 AM (Wednesday)

The Small Business Optimism Index gained 0.8 points, restoring the August reading of 96.1, either a strong recession reading or a weak expansion reading, no clear direction. The average of the Index from 1974Q4 to 2014 to date is 98, which includes all the Great Recession readings. The responses to the ten Index component questions would have to improve by a net 20 percentage points just to get to the average. Overall, the Index and its components anticipate more of the same, for employment growth and for Gross Domestic Spending (GDP less exports), a more relevant measure for small business owners.

Voters and non-voters sent a clear message last Tuesday. For those who voted, most didn’t approve of the status quo. For those who didn’t vote, they weren’t persuaded to endorse any candidate. The question is, how much can the Republicans get done with the President holding his veto pen at the ready. Some of his supporters have counseled him to veto everything the Republican Congress sends his way. That would certainly be bad for the economy. There are over 300 bills sitting in the Senate that were passed by the House over the past 6 years, many by bipartisan majorities. But, if the President won’t negotiate, all Congress can do is pass them and send them to the Oval Office.

In his campaigning, the President touted his economic record. Apparently he and with many of us, can’t remember what “good times” really look like. The economy grew at a surprising 3.5 percent pace in Q3, distinctive in comparison to the 2.2 percent growth recorded to date in this expansion. However, the domestic economy did not enjoy that much strength, with Gross Domestic Expenditures (GDP-Exports) growing only 2.1 percent and consumer spending advancing at a 1.8 percent pace, down from 2.5 percent in the second quarter. Job gains remained mediocre but steady, touted by many as good, but those unemployed since 2007 would not share in the applause. Net exports added 1.3 percentage points to the growth rate great for the big firms, but the latest trade data now indicate a downward revision of 0.5 percentage points. The surge in government spending, mostly in defense, added 0.8 percentage points, but is not likely to repeat next quarter. So the basic domestic economy remained operating in the 2.2 percent growth range, and that’s the economy that matters to small businesses. It will be interesting to see if there are any “psychological” impacts after the election. Obviously there are about as many disappointed voters as happy ones. But business owners who characterize the current as a “bad time to expand” their business have blamed the “political climate” at elevated rates, second only to blaming the weak economy. It will be interesting to see if this abates in the November survey, and even better, if there are signs of renewed strength in capital spending plans.


Purchase Apps down, Refi's down in Latest MBA Weekly Survey
Posted: November 12, 2014 at 07:00 AM (Wednesday)

Mortgage applications decreased 0.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Nov. 7, 2014.

The Market Composite Index, a measure of mortgage loan application volume, decreased 0.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased two percent compared with the previous week. The Refinance Index decreased two percent from the previous week. The seasonally adjusted Purchase Index increased one percent from one week earlier. The unadjusted Purchase Index decreased two percent compared with the previous week and was 11 percent lower than the same week one year ago.

The refinance share of mortgage activity remained unchanged at 63 percent of total applications from the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.1 percent of total applications, the lowest level since January 2014.

The FHA share of total applications increased to 9.6 percent this week from 9.5 percent last week. The VA share of total applications increased to 11 percent this week from 10.7 percent last week. The USDA share of total applications remained unchanged at 0.9 percent this week.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.19 percent from 4.17 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 increased 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 4.13 percent, with points increasing to 0.15 from 0.11 (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 3.90 percent from 3.84 percent, with points decreasing to 0.14 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 15-year fixed-rate mortgages remained unchanged at 3.38 percent, with points decreasing to 0.22 from 0.31 (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 3.05 percent from 3.08 percent, with points decreasing to 0.32 from 0.33 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.


ICSC Chain Store Sales increased by 1.5% in Nov 8 Wk
Posted: November 11, 2014 at 08:30 AM (Tuesday)

The International Council of Shopping Centers (ICSC) and Goldman Sachs Weekly Chain Store Sales Index increased 2.1% for the week ending November 8 - relative to the prior year. On a week-over-week basis, sales increased by 1.5%.

"Department and electronics stores lead the way this week," said Michael Niemira, ICSC research consultant. "Consumers are still seeing a huge break at the gas pump, with the average price per gallon hitting its lowest point since November 29, 2010 - something that certainly bodes well for the upcoming holiday shopping season as more discretionary income should be available," he added.


Employment Trends Index increased in October to 123.09
Posted: November 10, 2014 at 10:00 AM (Monday)

The Conference Board Employment Trends Index™ (ETI) increased in October. The index now stands at 123.09, up from 121.91 (an upward revision) in September. This represents a 7.7 percent gain in the ETI compared to a year ago.

The Employment Trends Index continues to increase rapidly, with all eight components improving in October. The index is signaling solid job growth through the winter. As a result, we could see the unemployment rate reach its natural rate of 5.5 percent by early Spring.

October’s increase in the ETI was driven by positive contributions from all 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, Initial Claims for Unemployment Insurance, Ratio of Involuntarily Part-time to All Part-time Workers, Number of Temporary Employees, Industrial Production, Percentage of Respondents Who Say They Find “Jobs Hard to Get,” Real Manufacturing and Trade Sales, and Job Openings.


Consumer Credit Increased at an annual rate of 6.50%
Posted: November 7, 2014 at 03:00 PM (Friday)

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


October Employment increased by 214,000
Unemployment Rate dropped to 5.8%

Posted: November 7, 2014 at 08:30 AM (Friday)

Total nonfarm payroll employment rose by 214,000 in October, and the unemployment
rate edged down to 5.8 percent, the U.S. Bureau of Labor Statistics reported today. Employment increased in food services and drinking places, retail trade, and health care.

Both the unemployment rate (5.8 percent) and the number of unemployed persons (9.0 million) edged down in October. Since the beginning of the year, the unemployment rate and the number of unemployed persons have declined by 0.8 percentage point and 1.2 million, respectively.

Among the major worker groups, the unemployment rate for whites declined to 4.8 percent in October. The rates for adult men (5.1 percent), adult women (5.4 percent), teenagers (18.6 percent), blacks (10.9 percent), and Hispanics (6.8 percent) changed little over the month. The jobless rate for Asians was 5.0 percent (not seasonally adjusted), little changed from a year earlier.

In October, the number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 2.9 million. These individuals accounted for 32.0 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 was little changed at 62.8 percent in October and has been essentially flat since April. The employment-population ratio increased to 59.2 percent in October.

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was about unchanged in October at 7.0 million. These individuals, who would have preferred full-time employment, were working part time because their hours had been cut back or because they were unable to find a full-time job.

In October, 2.2 million persons were marginally attached to the labor force, little changed 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 770,000 discouraged workers in October, essentially unchanged 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 October had not searched for work for reasons such as school attendance or family responsibilities.

Total nonfarm payroll employment increased by 214,000 in October, in line with the average monthly gain of 222,000 over the prior 12 months. In October, job growth occurred in food services and drinking places, retail trade, and health care.

In October, the average workweek for all employees on private nonfarm payrolls edged up by 0.1 hour to 34.6 hours. The manufacturing workweek was unchanged at 40.8 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 edged up by 0.1 hour to 33.8 hours.

Average hourly earnings for all employees on private nonfarm payrolls rose by 3 cents to $24.57 in October. Over the year, average hourly earnings have risen by 2.0 percent. In October, average hourly earnings of private-sector production and nonsupervisory employees increased by 4 cents to $20.70.

The change in total nonfarm payroll employment for August was revised from +180,000 to +203,000, and the change for September was revised from +248,000 to +256,000. With these revisions, employment gains in August and September combined were 31,000 more than previously reported.


DJ-BTMU U.S. Business Barometer unch%
Posted: November 6, 2014 at 10:00 AM (Thursday)

For the week ending October 25 2014, the DJ-BTMU U.S. Business Barometer remained at the same level, 98.1, from the prior week as gains in some indexes were entirely cancelled out by drops in others. On one side, electric output and coal production declined by 1.7 and 4.3 percent, respectively, in line with a sharp drop of 5 percent in MBA’s purchase index. However, on the other side, chain store sales picked up by 0.3 percent, after declining for two consecutive weeks. Auto and truck production also rose by 0.5 and 2.1 percent, respectively.

On a year-over-year basis, the barometer showed a gain of 0.7 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 0.1 percent to 98.1. Its year-over-year growth rate was 0.8 percent.


3Q2014 Productivity Growth Increased 2.0%
Posted: November 6, 2014 at 08:30 AM (Thursday)

Nonfarm business sector labor productivity increased at a 2.0 percent annual rate during the third quarter of 2014, the U.S. Bureau of Labor Statistics reported today, as output increased 4.4 percent and hours worked increased 2.3 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the third quarter of 2013 to the third quarter of 2014, productivity rose 0.9 percent as output and hours worked increased 3.0 percent and 2.1 percent, respectively.

Unit labor costs in the nonfarm business sector rose 0.3 percent in the third quarter of 2014, as a 2.3 percent increase in hourly compensation was larger than the 2.0 percent increase in productivity. Unit labor costs increased 2.4 percent over the last four quarters.

Manufacturing sector productivity increased 3.2 percent in the third quarter of 2014, as output increased 4.1 percent and hours worked increased 0.8 percent. In the durable goods manufacturing sector, productivity grew 4.2 percent, reflecting a 6.6 percent increase in output and a 2.3 percent increase in hours. In nondurable goods industries, productivity grew 3.0 percent, as output increased 1.2 percent and hours worked fell 1.8 percent. Over the last four quarters, manufacturing productivity increased 2.8 percent, as output increased 4.4 percent and hours increased 1.5 percent. Unit labor costs in manufacturing decreased 0.7 percent in the third quarter of 2014 and increased 0.6 percent from the same quarter a year ago.

In the second quarter of 2014, nonfarm business sector productivity increased 2.9 percent, rather than 2.3 percent as reported September 4. The revised figure reflects an upward revision to output and a small downward revision to hours worked. Unit labor costs decreased 0.5 percent during the second quarter--rather than decreasing 0.1 percent as previously reported--due to the upward revision to productivity. In the manufacturing sector, productivity growth was revised up to 3.5 percent due to both an upward revision to output and a small downward revision to hours. Unit labor costs decreased 1.8 percent, a larger decrease than previously reported.

Second-quarter 2014 measures of productivity and costs were revised for the nonfinancial corporate sector. Productivity increased 4.0 percent rather than the preliminary estimate of 3.1 percent.


Weekly Initial Unemployment Claims Decrease 10,000 to 278,000
Posted: November 6, 2014 at 08:30 AM (Thursday)

In the week ending November 1, the advance figure for seasonally adjusted initial claims was 278,000, a decrease of 10,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 287,000 to 288,000. The 4-week moving average was 279,000, a decrease of 2,250 from the previous week's revised average. This is the lowest level for this average since April 29, 2000 when it was 273,000. The previous week's average was revised up by 250 from 281,000 to 281,250. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.8 percent for the week ending October 25, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending October 25 was 2,348,000, a decrease of 39,000 from the previous week's revised level. This is the lowest level for insured unemployment since December 23, 2000 when it was 2,340,000. The previous week's level was revised up 3,000 from 2,384,000 to 2,387,000. The 4-week moving average was 2,369,750, a decrease of 8,500 from the previous week's revised average. This is the lowest level for this average since January 13, 2001 when it was 2,360,500. The previous week's average was revised up by 750 from 2,377,500 to 2,378,250.


Challenger Layoffs surged nearly 70% in October
Posted: November 6, 2014 at 07:00 AM (Thursday)

Just one month after falling to a 14-year low, monthly job cuts surged nearly 70 percent in October to the second highest total this year, according to the report Thursday from global outplacement consultancy Challenger, Gray & Christmas, Inc.

U.S.-based employers announced 51,183 job cuts last month, a 68-percent increase from September’s 30,477, which was the lowest monthly total since June, 2000 (17,241). October job cuts were 12 percent higher than the 45,730 layoffs announced during the same month a year ago.

The October total is not only the second highest of the year behind May’s 52,961, but it marks only the fourth time in the last 22 months that job cuts exceeded 50,000.

Employers have now announced 414,591 job cuts so far this year. That is 4.3 percent fewer than last year, when 433,114 job cuts were reported from January through October.

While it is too early to say for certain, the October figure may mark the kick-off to a fourth-quarter surge in job cuts. It is not unusual to see the pace of downsizing accelerate in the final months of the year, as employers take measures to meet year-end earnings and profit goals.

In recent years, since the end of the recession, the fourth quarter surge in job cuts has been somewhat subdued, with much of the increase occurring in October and November. In fact, in the previous two years, December was one of the lowest job-cut months.

October job cuts were led by the retail industry, which announced 6,874 planned layoffs during the month. That is nearly 3.5 times more than the 1,965 job cuts announced by retailers in September. To date, these employers have now announced 38,948 in 2014, second only to the computer industry.

Computer firms announced another 6,509 job cuts in October. That brings the year-to-date total for the industry to 55,511, making it the leading job-cut industry by a wide margin.

If there is any good news in the October job-cut surge, it is that the leading job cuts are not indicative of overall weakness in the economy. The heaviest cuts came from companies that are struggling to find their footing in this recovery. In several cases, downsizing organizations are in industries that are going through fundamental changes and these companies are taking steps to catch up to these changes.

For example, Sears, which announced the closure of 77 Sears and Kmart stores, has been struggling for years to find its niche in an increasingly competitive retail space. The challenges facing the one-time leader in the retail space have gotten progressively worse as more and more consumers take their shopping online.

Meanwhile, Hewlett-Packard, which announced it is increasing previously announced workforce reductions by another 5,000, is another company trying to catch up in an ever-changing, but still robust and competitive technology sector. Likewise, wireless service provider Sprint has undergone large-scale job cuts since the beginning of the year in an effort to better compete in its fiercely competitive sector.


ISM Non-Manufacturing Index grew slower at 57.1%
Posted: November 5, 2014 at 10:00 AM (Wednesday)

Economic activity in the non-manufacturing sector grew in October for the 57th consecutive month, say the nation’s purchasing and supply executives in the latest Non-Manufacturing ISM® Report On Business®.

The NMI® registered 57.1 percent in October, 1.5 percentage points lower than the September reading of 58.6 percent. This represents continued growth in the non-manufacturing sector. The Non-Manufacturing Business Activity Index decreased to 60 percent, which is 2.9 percentage points lower than the September reading of 62.9 percent, reflecting growth for the 63rd consecutive month at a slower rate. The New Orders Index registered 59.1 percent, 1.9 percentage points lower than the reading of 61 percent registered in September. The Employment Index increased 1.1 percentage points to 59.6 percent from the September reading of 58.5 percent and indicates growth for the eighth consecutive month. The Prices Index decreased 3.1 percentage points from the September reading of 55.2 percent to 52.1 percent, indicating prices increased at a slower rate in October when compared to September. According to the NMI®, 16 non-manufacturing industries reported growth in October. The majority of the respondents’ comments reflect favorable business conditions; however, there is an indication that there continues to be a leveling off from the strong rate of growth of the preceding months.

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


Help Wanted OnLine Labor Demand rose 11,700 in October
Posted: November 5, 2014 at 10:00 AM (Wednesday)

Online advertised vacancies rose 11,700 to 5,083,600 in October, according to The Conference Board Help Wanted OnLine® (HWOL) Data Series, released today. The September Supply/Demand rate stands at 1.83 unemployed for each advertised vacancy, with a total of 4.2 million more unemployed workers than the number of advertised vacancies. The number of unemployed was 9.3 million in September.

U.S. labor demand continues on a steady, slow growth trend, maintaining historically high demand levels with over 5 million ads each month. The data continue to indicate a strong U.S. labor market.

In October, the Services/Production occupational category saw a gain, while the Professional category saw a small loss. Sales (22,100) and Transportation (23,800) bounced back from large September losses with most other occupational categories showing just small increases/decreases.


ADP National Employment Report increased by 230,000 in October
Posted: November 5, 2014 at 08:30 AM (Wednesday)

Private sector employment increased by 230,000 jobs from September to October according to the October 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.

Payrolls for businesses with 49 or fewer employees increased by 102,000 jobs in October, up from 93,000 in September. Job growth was up dramatically over the month for medium-sized firms. Employment among companies with 50-499 employees rose by 122,000, well over twice September’s increase of 47,000. Employment at large companies – those with 500 or more employees – saw a big drop from 85,000 the previous month to only 5,000 jobs added in October. Companies with 500-999 employees added 14,000 jobs, up from September’s 8,000. However, this increase was offset by the loss of 8,000 jobs by companies with over 1,000 employees.

Goods-producing employment rose by 48,000 jobs in October, down slightly from 50,000 jobs gained in September. The construction industry added 28,000 jobs over the month, above last month’s gain of 13,000. Meanwhile, manufacturing added 15,000 jobs in October, down by over half from September’s 33,000 which was the highest total in that sector since March 2011.

Service-providing employment rose by 181,000 jobs in October, up from 176,000 in September. The ADP National Employment Report indicates that professional/business services contributed 53,000 jobs in October. Expansion in trade/transportation/utilities grew by 47,000, up from September’s 37,000. The 4,000 new jobs added in financial activities was less than half of last month’s number.

Employment continues to trend upward as we begin the last quarter of 2014, driven mostly by small to mid-sized companies. October’s job growth is the highest since June and the second highest gain of 2014.

The job market is steadily picking up pace. Job growth is strong and broad-based across industries and company sizes. At this pace of job growth unemployment and underemployment is quickly declining. The job market will soon be tight enough to support a meaningful acceleration in wage growth.


Purchase Apps down, Refi's down in Latest MBA Weekly Survey
Posted: November 5, 2014 at 07:00 AM (Wednesday)

Mortgage applications decreased 2.6 percent from one week earlier , according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 31, 2014.

The Market Composite Index, a measure of mortgage loan application volume, decreased 2.6 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 6 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 13 percent lower than the same week one year ago.

The refinance share of mortgage activity decreased to 63 percent of total applications from 65 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.4 percent of total applications.

The FHA share of total applications increased to 9.5 percent this week from 8.9 percent last week. The VA share of total applications remained unchanged at 10.7 percent this week and the USDA share of total applications remained unchanged at 0.9 percent this week.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.17 percent from 4.13 percent, with points increasing to 0.22 from 0.21 (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) remained unchanged at 4.13 percent, with points decreasing to 0.11 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 30-year fixed-rate mortgages backed by the FHA remained unchanged at 3.84 percent, with points increasing to 0.34 from 0.16 (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 3.38 percent from 3.28 percent, with points increasing to 0.31 from 0.24 (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 3.08 percent from 2.94 percent, with points decreasing to 0.33 from 0.43 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.


New orders for manufactured goods decreased 0.6%
Posted: November 4, 2014 at 10:00 AM (Tuesday)

New orders for manufactured goods in September, down two consecutive months, decreased $2.8 billion or 0.6 percent to $499.4 billion, the U.S. Census Bureau reported today. This followed a 10.0 percent August decrease. Excluding transportation, new orders decreased slightly.

Shipments, up three of the last four months, increased $0.7 billion or 0.1 percent to $503.4 billion. This followed a 1.1 percent August decrease.

Unfilled orders, up seventeen of the last eighteen months, increased $3.7 billion or 0.3 percent to $1,168.7 billion. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.6 percent August increase. The unfilled orders-to-shipments ratio was 6.71, unchanged from August.

Inventories, up twenty-two of the last twenty-three months, increased $1.5 billion or 0.2 percent to $655.2 billion. This was also at the highest level since the series was first published on a NAICS basis and followed a 0.1 percent August increase. The inventories-to-shipments ratio was 1.30, unchanged from August.

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