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Pending Home Sales Index decreased 0.8% in May
Posted: June 28, 2017 at 10:00 AM (Wednesday)

The ongoing supply shortages that are propping up home prices in many metro areas caused pending home sales in May to slump for the third consecutive month, according to the National Association of Realtors®. None of the major regions saw an increase in contract activity last month.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, decreased 0.8 percent to 108.5 in May from a downwardly revised 109.4 in April. The index is now 1.7 percent below a year ago, which marks the second straight annual decline and the most recent since November and December of last year.

Lawrence Yun, NAR chief economist, says it's clear the critically low inventory levels in much of the country somewhat sidetracked the housing market this spring. "Monthly closings have recently been oscillating back and forth, but this third consecutive decline in contract activity implies a possible topping off in sales," he said. "Buyer interest is solid, but there is just not enough supply to satisfy demand. Prospective buyers are being sidelined by both limited choices and home prices that are climbing too fast."

The persistent housing shortages seen in several markets are most severe, according to Yun, in the lower price ranges. That's very apparent when looking at the percent change in closings in May compared to a year ago. Sales of homes under $100,000 last month were down 7.2 percent from last year and up only 2.0 percent for those between $100,000 and $250,000. In higher price brackets, sales expanded incrementally all the way up to massive increases of 26.0 percent for homes priced between $750,000 and $1 million and even more for those $1 million and up (29.1 percent).

Weaker financial and economic confidence could also be playing a role in the slowdown in contract activity. NAR's quarterly Housing Opportunities and Market Experience (HOME) survey, released earlier this week, found that fewer renters think it's a good time to buy a home, and respondents overall are less confident about the economy and their financial situation than earlier this year.

"The lack of listings in the affordable price range are creating lopsided conditions in many areas where investors and repeat buyers with larger down payments are making up a bulk of the sales activity," said Yun. "Meanwhile, many prospective first-time buyers can't catch a break. Prices are going up and there's intense competition for the homes they're financially able to purchase."

Existing-home sales are forecast to be around 5.63 million this year, an increase of 3.2 percent from 2016 (5.45 million). The national median existing-home price this year is expected to increase around 5 percent. In 2016, existing sales increased 3.8 percent and prices rose 5.1 percent.

"A much higher share of homeowners compared to a year ago think now is a good time to sell, but until they do, sales will likely stay flat and low inventory will keep price growth moving swiftly," said Yun.

The PHSI in the Northeast decreased 0.8 percent to 96.4 in May, but remains 3.1 percent above a year ago. In the Midwest the index was 104.5 in May (unchanged from April), and is 2.8 percent lower than May 2016.

Pending home sales in the South declined 1.2 percent to an index of 123.4 in May and are now 1.4 percent below last May. The index in the West subsided 1.3 percent in May to 98.6, and is now 4.5 percent below a year ago.


Purchase Apps down, Refi's down in Latest MBA Weekly Survey
Posted: June 28, 2017 at 07:00 AM (Wednesday)

Mortgage applications decreased 6.2 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending June 23, 2017.

The Market Composite Index, a measure of mortgage loan application volume, decreased 6.2 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 decreased 9 percent from the previous week. The seasonally adjusted Purchase Index decreased 4 percent from one week earlier. The unadjusted Purchase Index decreased 5 percent compared with the previous week and was 8 percent higher than the same week one year ago.

The refinance share of mortgage activity decreased to 45.6 percent of total applications from 46.6 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.0 percent of total applications.

The FHA share of total applications increased to 10.3 percent from 10.1 percent the week prior. The VA share of total applications decreased to 10.3 percent from 10.4 percent the week prior. The USDA share of total applications remained unchanged at 0.7 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) remained unchanged at 4.13 percent, with points decreasing to 0.32 from 0.34 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $424,100) increased to 4.09 percent from 4.08 percent, with points decreasing to 0.20 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 30-year fixed-rate mortgages backed by the FHA decreased to 4.02 percent from 4.04 percent, with points increasing to 0.41 from 0.35 (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 decreased to 3.39 percent from 3.40 percent, with points decreasing to 0.33 from 0.38 (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 3.31 percent from 3.26 percent, with points increasing to 0.25 from 0.22 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.


Consumer Confidence increased moderately in June to 118.9
Posted: June 27, 2017 at 10:00 AM (Tuesday)

The Conference Board Consumer Confidence Index®, which had decreased in May, increased moderately in June. The Index now stands at 118.9 (1985=100), up from 117.6 in May. The Present Situation Index increased from 140.6 to 146.3, while the Expectations Index declined from 102.3 last month to 100.6.

“Consumer confidence increased moderately in June following a small decline in May,” said Lynn Franco, Director of Economic Indicators at The Conference Board. “Consumers’ assessment of current conditions improved to a nearly 16-year high (July 2001, 151.3). Expectations for the short-term have eased somewhat, but are still upbeat. Overall, consumers anticipate the economy will continue expanding in the months ahead, but they do not foresee the pace of growth accelerating.”

Consumers’ appraisal of current conditions improved in June. Those saying business conditions are “good” increased from 29.8 percent to 30.8 percent, while those saying business conditions are “bad” declined from 13.9 percent to 12.7 percent. Consumers’ assessment of the labor market was also more positive. Those stating jobs are “plentiful” rose from 30.0 percent to 32.8 percent, while those claiming jobs are “hard to get” decreased slightly from 18.3 percent to 18.0 percent.

Consumers, however, were less optimistic about the short-term outlook in June. The percentage of consumers expecting business conditions to improve over the next six months decreased from 21.5 percent to 20.4 percent, however, those expecting business conditions to worsen declined marginally from 10.3 percent to 9.9 percent.

Consumers’ outlook for the labor market remained mixed. The proportion expecting more jobs in the months ahead increased from 18.6 percent to 19.3 percent, but those anticipating fewer jobs increased from 12.1 percent to 14.6 percent. The percentage of consumers expecting an improvement in their income rose from 19.1 percent to 22.2 percent, but the proportion expecting a decline increased slightly from 8.7 percent to 9.2 percent.


Richmond Fed's Current Activity Index rose 6 points to a reading of 7
Posted: June 27, 2017 at 10:00 AM (Tuesday)

Reports from Fifth District manufacturers improved in June, according to the latest survey by the Federal Reserve Bank of Richmond. The composite manufacturing index rose from 1 in May to 7 in June, as the indexes for shipments and new orders increased. The employment index was relatively flat. Most firms continued to report steady or higher wages; although the index for wages did fall in June, it remained above 0. Meanwhile, more firms reported a decline in the average workweek than reported an increase.

Looking six months ahead, manufacturing executives were more optimistic in June than in May, although even the May readings were very positive. Among the indexes for expected activity, only two fell: the capital expenditures index declined from 34 in May to 26 in June and the expected shipments metric inched down from 39 to 38.

Survey responses pointed toward more moderate growth in both prices paid and prices received. Expected growth in prices received also moderated, although expected growth in prices paid picked up somewhat.


S&P CoreLogic Case-Shiller Home Price Indices gained 0.9% in April
Posted: June 27, 2017 at 09:00 AM (Tuesday)

S&P Dow Jones Indices today released the latest results for the S&P CoreLogic Case-Shiller Indices, the leading measure of U.S. home prices. Data released today for April 2017 shows that home prices continued their rise across the country over the last 12 months.

YEAR-OVER-YEAR
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 5.5% annual gain in April, down from 5.6% last month. The 10-City Composite annual increase came in at 4.9%, down from 5.2% the previous month. The 20-City Composite posted a 5.7% year-over-year gain, down from 5.9% in March.

Seattle, Portland, and Dallas reported the highest year-over-year gains among the 20 cities. In April, Seattle led the way with a 12.9% year-over-year price increase, followed by Portland with 9.3%, and Dallas with an 8.4% increase. Seven cities reported greater price increases in the year ending April 2017 versus the year ending March 2017.

The below charts compare year-over-year returns for Seattle and Portland with different ranges of housing prices (tiers). Upon tier level analysis from 2011 to present, both Seattle and Portland’s year-over-year returns show housing prices in the high tier to be the most stable while housing prices in the low tier are the most volatile.

MONTH-OVER-MONTH
Before seasonal adjustment, the National Index posted a month-over-month gain of 0.9% in April. The 10-City Composite posted a 0.8% increase and the 20-City Composite reported a 0.9% increase in April. After seasonal adjustment, the National Index recorded a 0.2% month-over-month increase. The 10-City Composite posted a 0.2% month-over-month increase. The 20-City Composite posted a 0.3% month-over-month increase. Eighteen of 20 cities reported increases in April before seasonal adjustment; after seasonal adjustment, 13 cities saw prices rise.

ANALYSIS
“As home prices continue rising faster than inflation, two questions are being asked: why? And, could this be a bubble?” says David M. Blitzer Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “Since demand is exceeding supply and financing is available, there is nothing right now to keep prices from going up. The increase in real, or inflation-adjusted, home prices in the last three years shows that demand is rising. At the same time, the supply of homes for sale has barely kept pace with demand and the inventory of new or existing homes for sale shrunk down to only a four- month supply. Adding to price pressures, mortgage rates remain close to 4% and affordability is not a significant issue.

“The question is not if home prices can climb without any limit; they can’t. Rather, will home price gains gently slow or will they crash and take the economy down with them? For the moment, conditions appear favorable for avoiding a crash. Housing starts are trending higher and rising prices may encourage some homeowners to sell. Moreover, mortgage default rates are low and household debt levels are manageable. Total mortgage debt outstanding is $14.4 trillion, about $400 billion below the record set in 2008. Any increase in mortgage interest rates would dampen demand. Household finances should be able to weather a fairly large price drop.”

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, which covers all nine U.S. census divisions, recorded a 5.5% annual gain in April 2017. The 10-City and 20-City Composites reported year-over-year increases of 4.9% and 5.7%, respectively. As of April 2017, average home prices for the MSAs within the 10-City and 20-City Composites are back to their winter 2007 levels.


Texas Fed Manufacturing Activity Expanded but at a Slower Pace in June
Posted: June 26, 2017 at 10:30 AM (Monday)

Texas factory activity increased in June, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, fell 11 points to 12.3, indicating output grew but at a slower pace than in May.

Other measures of current manufacturing activity also indicated that growth moderated. The new orders and growth rate of orders indexes fell several points each, coming in at 9.6 and 4.7, respectively. The capacity utilization index moved down to 12.3, and the shipments index retreated to 8.5 after surging last month.

Perceptions of broader business conditions improved in June, although the indexes were less positive than in May. The general business activity index edged down to 15.0. The company outlook index posted a 10th consecutive positive reading but fell nine points to 10.8.

Labor market measures indicated continued employment gains and longer workweeks this month. The employment index posted a sixth consecutive positive reading and edged up to 9.6. Nineteen percent of firms noted net hiring, compared with 10 percent noting net layoffs. The hours worked index dropped to 8.9, down seven points from a six-year high last month.

Prices and wages rose in June, albeit at a somewhat slower pace. Upward pressure on input costs continued to recede slightly, with the raw materials prices index edging down two points to 15.6. Upward pressure on selling prices also abated, with the finished goods prices index falling from 5.9 to 3.6. The wages and benefits index remained elevated but ticked down to 21.1.

Expectations regarding future business conditions continued to improve. The index of future general business activity held steady at 31.9, while the index of future company outlook came in at 35.6, up five points from last month’s reading. Other indexes for future manufacturing activity showed mixed movements but remained solidly in positive territory.


May New Orders for Durable Goods Decreased 1.1%, Ex-Trans up 1.0%
Posted: June 26, 2017 at 08:30 AM (Monday)

New Orders
New orders for manufactured durable goods in May decreased $2.5 billion or 1.1 percent to $228.2 billion, the U.S. Census Bureau announced today. This decrease, down two consecutive months, followed a 0.9 percent April decrease. Excluding transportation, new orders increased 0.1 percent. Excluding defense, new orders decreased 0.6 percent. Transportation equipment, also down two consecutive months, drove the decrease, $2.7 billion or 3.4 percent to $75.4 billion.

Shipments
Shipments of manufactured durable goods in May, up following two consecutive monthly decreases, increased $1.8 billion or 0.8 percent to $234.9 billion. This followed a 0.3 percent April decrease. Transportation equipment, up following four consecutive monthly decreases, led the increase, $1.5 billion or 1.9 percent to $78.8 billion.

Unfilled Orders
Unfilled orders for manufactured durable goods in May, down following two consecutive monthly increases, decreased $2.3 billion or 0.2 percent to $1,120.1 billion. This followed a 0.2 percent April increase. Transportation equipment, also down following two consecutive monthly increases, drove the decrease, $3.4 billion or 0.4 percent to $762.8 billion.


Chicago Fed National Activity Growth is slower in May
Posted: June 26, 2017 at 08:30 AM (Monday)

The CFNAI Diffusion Index, which is also a three-month moving average, decreased to –0.08 in May from +0.10 in April. Thirty-two of the 85 individual indicators made positive contributions to the CFNAI in May, while 53 made negative contributions. Twenty-six indicators improved from April to May, while 56 indicators deteriorated and three were unchanged. Of the indicators that improved, ten made negative contributions.

The contribution from production-related indicators to the CFNAI declined to –0.16 in May from +0.53 in April. Total industrial production was unchanged in May after moving up 1.1 percent in April, and manufacturing production decreased 0.4 percent in May after increasing 1.1 percent in the previous month.

Employment-related indicators contributed –0.02 to the CFNAI in May, down from +0.12 in April. Civilian employment decreased by 233,000 in May after increasing by 156,000 in the previous month; and nonfarm payrolls increased by 138,000 in May, following a gain of 174,000 in April.

The contribution of the personal consumption and housing category to the CFNAI edged down to –0.09 in May from –0.07 in April. Housing starts decreased to 1,092,000 annualized units in May from 1,156,000 in April, and housing permits decreased to 1,168,000 annualized units in May from 1,228,000 in the previous month.

The sales, orders, and inventories category made a contribution of +0.02 to the CFNAI in May, up slightly from –0.01 in April.

The CFNAI was constructed using data available as of June 22, 2017. At that time, May data for 51 of the 85 indicators had been published. For all missing data, estimates were used in constructing the index. The April monthly index value was revised to +0.57 from an initial estimate of +0.49, and the March monthly index value was revised to –0.18 from last month’s estimate of +0.07. Revisions to the monthly index can be attributed to two main factors: revisions in previously published data and differences between the estimates of previously unavailable data and subsequently published data. The revision to the April monthly index value was primarily due to the latter, while the revision to the March monthly index value was primarily due to the former.


New Home Sales in May at annual rate of 610,000
Posted: June 23, 2017 at 10:00 AM (Friday)

Sales of new single-family houses in May 2017 were at a seasonally adjusted annual rate of 610,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 2.9 percent (±13.0 percent)* above the revised April rate of 593,000 and is 8.9 percent (±21.9 percent)* above the May 2016 estimate of 560,000.

The median sales price of new houses sold in May 2017 was $345,800. The average sales price was $406,400. The seasonally-adjusted estimate of new houses for sale at the end of May was 268,000. This represents a supply of 5.3 months at the current sales rate.


Kansas City Fed Manufacturing Activity expanded further in June
Posted: June 22, 2017 at 11:00 AM (Thursday)

Tenth District manufacturing activity expanded further in June, and expectations for future activity remained strong. Price indexes were mixed, with some increases in raw materials prices.

The month-over-month composite index was 11 in June, up from 8 in May and 7 in April. The composite index is an average of the production, new orders, employment, supplier delivery time, and raw materials inventory indexes. Activity increased moderately at both durable and non-durable goods plants, particularly for aircraft, computers and electronics, chemicals, and plastics. Month-over-month indexes were mixed. The production index jumped from -1 to 23, and the shipments and employment indexes also increased. On the other hand, the new orders index eased from 9 to 4, and the order backlog index fell into negative territory. Both inventory indexes inched lower.

Most year-over-year factory indexes increased from the previous month. The composite year-over-year index rose from 18 to 28, its highest level since June 2011, and the production, shipment, and new orders indexes also increased moderately. The employment index edged higher from 18 to 24, a five-year high. In contrast, the capital expenditures index eased from 16 to 13 and the order backlog index also moved slightly lower. The raw materials inventory index climbed from 8 to 22, while the finished goods inventory index moderated.

Expectations for future factory activity generally remained strong. The future composite index inched down from 30 to 25, and the future production, shipments, new orders, and order backlog indexes also decreased modestly but remained solidly in positive territory. The future capital expenditures index eased from 23 to 16, while the future employment index increased after falling the past two months. The future raw materials inventory index fell from 10 to 0, and the future finished goods inventory index also decreased.

Price indexes were mixed in June. The month-over-month finished goods price index fell from 8 to -2, while the raw materials price index was mostly unchanged. The raw materials price index edged higher from 44 to 47, while the year-over-year finished goods price index was basically unchanged. The future raw materials price index increased from 37 to 49, while the future finished goods price index eased slightly.


U.S. Leading Economic Index increased 0.3% in May
Posted: June 22, 2017 at 10:00 AM (Thursday)

The Conference Board Leading Economic Index® (LEI) for the U.S. increased 0.3 percent in May to 127.0 (2010 = 100), following a 0.2 percent increase in April, and a 0.4 percent increase in March.

“The U.S. LEI continued on its upward trend in May, suggesting the economy is likely to remain on, or perhaps even moderately above, its long-term trend of about 2 percent growth for the remainder of the year,” said Ataman Ozyildirim, Director of Business Cycles and Growth Research at The Conference Board. “The improvement was widespread among the majority of the leading indicators except for housing permits, which declined again. And, the average workweek in manufacturing has recently shown no sign of improvement.”

The Conference Board Coincident Economic Index® (CEI) for the U.S. increased 0.1 percent in May to 115.3 (2010 = 100), following a 0.3 percent increase in April, and a 0.1 percent increase in March.

The Conference Board Lagging Economic Index® (LAG) for the U.S. increased 0.1 percent in May to 124.2 (2010 = 100), following a 0.3 percent increase in April and a 0.2 percent increase in March.


Weekly Initial Unemployment Claims Increase 3,000 to 241,000
Posted: June 22, 2017 at 08:30 AM (Thursday)

In the week ending June 17, the advance figure for seasonally adjusted initial claims was 241,000, an increase of 3,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 237,000 to 238,000. The 4-week moving average was 244,750, an increase of 1,500 from the previous week's revised average. The previous week's average was revised up by 250 from 243,000 to 243,250.

The advance seasonally adjusted insured unemployment rate was 1.4 percent for the week ending June 10, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending June 10 was 1,944,000, an increase of 8,000 from the previous week's revised level. The previous week's level was revised up 1,000 from 1,935,000 to 1,936,000. The 4-week moving average was 1,932,000, an increase of 5,000 from the previous week's revised average. The previous week's average was revised up by 250 from 1,926,750 to 1,927,000.


Existing-Home Sales Up 1.1% in May
Posted: June 21, 2017 at 10:00 AM (Wednesday)

Existing-home sales rebounded in May following a notable decline in April, and low inventory levels helped propel the median sales price to a new high while pushing down the median days a home is on the market to a new low, according to the National Association of Realtors®. All major regions except for the Midwest saw an increase in sales last month.

Total existing-home sales, https://www.nar.realtor/topics/existing-home-sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, climbed 1.1 percent to a seasonally adjusted annual rate of 5.62 million in May from a downwardly revised 5.56 million in April. Last month's sales pace is 2.7 percent above a year ago and is the third highest over the past year.

Lawrence Yun, NAR chief economist, says sales activity expanded in May as more buyers overcame the increasingly challenging market conditions prevalent in many areas. "The job market in most of the country is healthy and the recent downward trend in mortgage rates continues to keep buyer interest at a robust level," he said. "Those able to close on a home last month are probably feeling both happy and relieved. Listings in the affordable price range are scarce, homes are coming off the market at an extremely fast pace and the prevalence of multiple offers in some markets are pushing prices higher."

The median existing-home price2 for all housing types in May was $252,800. This surpasses last June ($247,600) as the new peak median sales price, is up 5.8 percent from May 2016 ($238,900) and marks the 63rd straight month of year-over-year gains.

Total housing inventory3 at the end of May rose 2.1 percent to 1.96 million existing homes available for sale, but is still 8.4 percent lower than a year ago (2.14 million) and has fallen year-over-year for 24 consecutive months. Unsold inventory is at a 4.2-month supply at the current sales pace, which is down from 4.7 months a year ago.

"Home prices keep chugging along at a pace that is not sustainable in the long run," added Yun. "Current demand levels indicate sales should be stronger, but it's clear some would-be buyers are having to delay or postpone their home search because low supply is leading to worsening affordability conditions."

Properties typically stayed on the market for 27 days in May, which is down from 29 days in April and 32 days a year ago; this is the shortest timeframe since NAR began tracking in May 2011. Short sales were on the market the longest at a median of 94 days in May, while foreclosures sold in 48 days and non-distressed homes took 27 days. Fifty-five percent of homes sold in May were on the market for less than a month (a new high).

Inventory data from realtor.com® reveals that the metropolitan statistical areas where listings stayed on the market the shortest amount of time in May were Seattle-Tacoma-Bellevue, Wash., 20 days; San Francisco-Oakland-Hayward, Calif., 24 days; San Jose-Sunnyvale-Santa Clara, Calif., 25 days; and Salt Lake City, Utah and Ogden-Clearfield, Utah, both at 26 days.

"With new and existing supply failing to catch up with demand, several markets this summer will continue to see homes going under contract at this remarkably fast pace of under a month," said Yun.

According to Freddie Mac, the average commitment rate (link is external) for a 30-year, conventional, fixed-rate mortgage decreased for the second consecutive month, dipping to 4.01 percent in May from 4.05 percent in April. The average commitment rate for all of 2016 was 3.65 percent.

First-time buyers were 33 percent of sales in May, which is down from 34 percent in April but up from 30 percent a year ago. NAR's 2016 Profile of Home Buyers and Sellers — released in late 2016 — revealed that the annual share of first-time buyers was 35 percent.

Earlier this month, NAR hosted the Sustainable Homeownership Conference at University of California's Memorial Stadium in Berkeley. A white paper titled, "Hurdles to Homeownership: Understanding the Barriers," was released, which honed in on the five main reasons why first-time buyers are failing to make up a greater share of the market.

"Of the barriers analyzed in the white paper, single-family housing shortages will be the biggest challenge for prospective first-time buyers this year," said President William E. Brown, a Realtor® from Alamo, California. "Those hoping to buy an entry-level, single-family home continue to see minimal choices. The best advice for these home shoppers is to know what you can afford, lean on the guidance of a Realtor® and act fast once an ideal property within the budget is listed."

All-cash sales were 22 percent of transactions in May, up from 21 percent in April and unchanged from a year ago. Individual investors, who account for many cash sales, purchased 16 percent of homes in May, up from 15 percent in April and 13 percent a year ago. Sixty-four percent of investors paid in cash in May.

Distressed sales — foreclosures and short sales — were 5 percent of sales in May, unchanged from April and down from 6 percent a year ago. Four percent of May sales were foreclosures and 1 percent were short sales. Foreclosures sold for an average discount of 20 percent below market value in May (18 percent in April), while short sales were discounted 16 percent (12 percent in April).
Single-family and Condo/Co-op Sales

Single-family home sales increased 1.0 percent to a seasonally adjusted annual rate of 4.98 million in May from 4.93 million in April, and are now 2.7 percent above the 4.85 million pace a year ago. The median existing single-family home price was $254,600 in May, up 6.0 percent from May 2016.

Existing condominium and co-op sales climbed 1.6 percent to a seasonally adjusted annual rate of 640,000 units in May, and are 3.2 percent higher than a year ago. The median existing condo price was $238,700 in May, which is 4.8 percent above a year ago.
Regional Breakdown

May existing-home sales in the Northeast jumped 6.8 percent to an annual rate of 780,000, and are now 2.6 percent above a year ago. The median price in the Northeast was $281,300, which is 4.7 percent above May 2016.

In the Midwest, existing-home sales fell 5.9 percent to an annual rate of 1.28 million in May, and are 0.8 percent below a year ago. The median price in the Midwest was $203,900, up 7.3 percent from a year ago.

Existing-home sales in the South rose 2.2 percent to an annual rate of 2.34 million, and are now 4.5 percent above May 2016. The median price in the South was $221,900, up 5.3 percent from a year ago.

Existing-home sales in the West increased 3.4 percent to an annual rate of 1.22 million in May, and are now 3.4 percent above a year ago. The median price in the West was $368,800, up 6.9 percent from May 2016.


Purchase Apps up, Refi's up in Latest MBA Weekly Survey
Posted: June 21, 2017 at 07:00 AM (Wednesday)

Mortgage applications increased 0.6 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending June 16, 2017.

The Market Composite Index, a measure of mortgage loan application volume, increased 0.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 0.4 percent compared with the previous week. The Refinance Index increased 2 percent from the previous week to its highest level since November 2016. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 9 percent higher than the same week one year ago.

The refinance share of mortgage activity increased to 46.6 percent of total applications from 45.4 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.5 percent of total applications.

The FHA share of total applications decreased to 10.1 percent from 11.2 percent the week prior. The VA share of total applications decreased to 10.4 percent from 11.1 percent the week prior. The USDA share of total applications decreased to 0.7 percent from 0.8 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) remained unchanged at 4.13 percent, with points decreasing to 0.34 from 0.35 (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 $424,100) increased to 4.08 percent from 4.06 percent, with points increasing to 0.30 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 30-year fixed-rate mortgages backed by the FHA increased to 4.04 percent from 4.00 percent, with points increasing to 0.35 from 0.29 (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 3.40 percent from 3.37 percent, with points increasing to 0.38 from 0.34 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs remained unchanged at 3.26 percent, with points increasing to 0.22 from 0.20 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.


University of Michigan Consumer Confidence Preliminary June Results at 94.5
Posted: June 16, 2017 at 10:00 AM (Friday)

The modest early June drop of 2.6 points in the Sentiment Index masks a much larger decline since June 8th. Prior to that date the Sentiment Index had averaged 97.7, but since June 8th, the Index fell to 86.7, a decline of 11.0 points. While this break corresponds with James Comey's testimony, only a few consumers spontaneously referred to him or his testimony when asked to explain their views. Importantly, the decline was observed across all political parties, but the loss in confidence among self-identified Republicans since June 8th was larger than among Democrats (9.2 vs. 6.8 Index-points), with Independents showing the greatest falloff (11.5 Index-points). The size of the partisan difference between Democrats and Republicans in the Expectations Index, however, was largely unchanged (55.6 Index-points prior to June 8th, and 51.2 after). The recent erosion of confidence was due to more negative perceptions of the proposed economic policies among Democrats and the reduced likelihood of passage of these policies among Republicans. Fortunately, a strong job market, improved household income and wealth have provided a financial buffer against rising uncertainties. Nonetheless, consumers have become less optimistic about the future course of the domestic economy. Even with the expected bounce back in spending in the current quarter, personal consumption is expected to advance by 2.3% for all of 2017.


May Housing Starts down 5.5%, Permits down 4.9%
Posted: June 16, 2017 at 08:30 AM (Friday)

Building Permits
Privately-owned housing units authorized by building permits in May were at a seasonally adjusted annual rate of 1,168,000. This is 4.9 percent (±0.9 percent) below the revised April rate of 1,228,000 and is 0.8 percent (±1.1 percent)* below the May 2016 rate of 1,178,000. Single-family authorizations in May were at a rate of 779,000; this is 1.9 percent (±1.0 percent) below the revised April figure of 794,000. Authorizations of units in buildings with five units or more were at a rate of 358,000 in May.

Housing Starts
Privately-owned housing starts in May were at a seasonally adjusted annual rate of 1,092,000. This is 5.5 percent (±11.9 percent)* below the revised April estimate of 1,156,000 and is 2.4 percent (±11.4 percent)* below the May 2016 rate of 1,119,000. Single-family housing starts in May were at a rate of 794,000; this is 3.9 percent (±10.4 percent)* below the revised April figure of 826,000. The May rate for units in buildings with five units or more was 284,000.

Housing Completions
Privately-owned housing completions in May were at a seasonally adjusted annual rate of 1,164,000. This is 5.6 percent (±9.2 percent)* above the revised April estimate of 1,102,000 and is 14.6 percent (±10.9 percent) above the May 2016 rate of 1,016,000. Single-family housing completions in May were at a rate of 817,000; this is 4.9 percent (±11.6 percent)* above the revised April rate of 779,000. The May rate for units in buildings with five units or more was 335,000.


Builder Confidence down 2 points to 67 in June
Posted: June 15, 2017 at 10:00 AM (Thursday)

Builder confidence in the market for newly-built single-family homes weakened slightly in June, down two points to a level of 67 from a downwardly revised May reading of 69 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI).

“Builder confidence levels have remained consistently sound this year, reflecting the ongoing gradual recovery of the housing market,” said NAHB Chairman Granger MacDonald, a home builder and developer from Kerrville, Texas.

“As the housing market strengthens and more buyers enter the market, builders continue to express their frustration over an ongoing shortage of skilled labor and buildable lots that is impeding stronger growth in the single-family sector,” said NAHB Chief Economist Robert Dietz.

All three HMI components posted losses in June but remain at healthy levels. The components gauging current sales conditions fell two points to 73 while the index charting sales expectations in the next six months dropped two points to 76. Meanwhile, the component measuring buyer traffic also moved down two points to 49.

Looking at the three-month moving averages for regional HMI scores, the Midwest and South each edged one point lower to 67 and 70, respectively. The Northeast and West both dropped two points to 46 and 76, respectively.


Industrial Production unchanged%
Capacity Utilization decreased to 76.6%

Posted: June 15, 2017 at 09:15 AM (Thursday)

Industrial production was unchanged in May following a large increase in April and smaller increases in February and March. Manufacturing output declined 0.4 percent in May; the index is little changed, on net, since February. The indexes for mining and utilities posted gains of 1.6 percent and 0.4 percent, respectively, in May. At 105.0 percent of its 2012 average, total industrial production in May was 2.2 percent above its year-earlier level. Capacity utilization for the industrial sector edged down 0.1 percentage point in May to 76.6 percent, a rate that is 3.3 percentage points below its long-run (1972–2016) average.


U.S. Import Price Index declined 0.3% in May
Posted: June 15, 2017 at 08:30 AM (Thursday)

U.S. import prices declined 0.3 percent in May, the U.S. Bureau of Labor Statistics reported today, after increasing 0.2 percent in April. Lower fuel prices drove the decrease in May and nonfuel prices recorded no change. The price index for U.S. exports declined 0.7 percent in May following a 0.2-percent advance in April.


Empire State Manufacturing Survey Conditions Bounces Back in June
Posted: June 15, 2017 at 08:30 AM (Thursday)

Business activity rebounded strongly in New York State, according to firms responding to the June 2017 Empire State Manufacturing Survey. The headline general business conditions index shot up twenty-one points to 19.8, its highest level in more than two years. The new orders index posted a similar increase, rising twenty-three points to 18.1, and the shipments index advanced to 22.3.The inventories index climbed to 7.7, indicating a rise in inventory levels, and labor market indicators pointed to a modest increase in employment and hours worked. The pace of input price increases was unchanged, while selling price increases picked up somewhat. Looking ahead, firms remained optimistic about the six-month outlook.

Business Activity Bounces Back
Manufacturing firms in New York State reported that business activity grew at a solid clip in June. After dropping to a level just below zero last month, the general business conditions index more than made up for lost ground, rising twenty-one points to 19.8, its highest level since September 2014. Thirty-six percent of respondents reported that conditions had improved over the month, while 16 percent reported that conditions had worsened. The new orders index, which showed a decline in orders last month, jumped twenty-three points to 18.1, indicating that orders increased markedly. The shipments index rose to 22.3, pointing to a substantial increase in shipments. The unfilled orders index moved up to 4.6, and the delivery time index was little changed at 5.4. The inventories index rose to 7.7, a sign that inventory levels were higher.

Labor Market Conditions Continue to Improve
Employment indexes remained positive, pointing to continued modest growth in employment levels and hours worked. The index for number of employees edged down four points to 7.7, and the average workweek index was little changed at 8.5. The prices paid index held steady at 20.0, and the prices received index rose six points to 10.8, pointing to a pickup in selling price increases.

Firms Remain Optimistic
Indexes assessing the six-month outlook suggested that firms continued to expect conditions to improve. The index for future business conditions was little changed at 41.7, and the index for future new orders rose nine points to 42.2. Inventories were expected to be slightly lower in the months ahead, and employment was expected to increase modestly. The capital expenditures index rose to 20.8, and the technology spending index was 11.5.


Weekly Initial Unemployment Claims Decrease 8,000 to 237,000
Posted: June 15, 2017 at 08:30 AM (Thursday)

In the week ending June 10, the advance figure for seasonally adjusted initial claims was 237,000, a decrease of 8,000 from the previous week's unrevised level of 245,000. The 4-week moving average was 243,000, an increase of 1,000 from the previous week's unrevised average of 242,000.

The advance seasonally adjusted insured unemployment rate was 1.4 percent for the week ending June 3, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending June 3 was 1,935,000, an increase of 6,000 from the previous week's revised level. The previous week's level was revised up 12,000 from 1,917,000 to 1,929,000. The 4-week moving average was 1,926,750, an increase of 9,000 from the previous week's revised average. The previous week's average was revised up by 3,000 from 1,914,750 to 1,917,750.


Philadelphia Fed Outlook Reported Activity continued to reflect growth in June
Posted: June 15, 2017 at 08:30 AM (Thursday)

Regional manufacturing continues to expand, according to results from the June Manufacturing Business Outlook Survey. The diffusion index for general activity fell from its reading in May but remained positive and continued to reflect growth. Although many of the future indicators also declined, firms continue to expect growth over the next six months. About one-third of the firms expect to add to their payrolls through the end of the year.

Current Indicators Reflect Continued Growth
The index for current manufacturing activity in the region decreased from a reading of 38.8 in May to 27.6 this month (see Chart 1). The index has been positive for 11 consecutive months. Forty-two percent of the firms indicated increases in activity in June, down from 51 percent last month. The shipments index decreased 11 points, while the new orders index was little changed. Both the delivery times and unfilled orders indexes were positive for the eighth consecutive month, suggesting longer delivery times and increases in unfilled orders.

Firms reported overall increases in manufacturing employment this month, but the current employment index fell 1 point. The index has remained positive for seven consecutive months. The percentage of firms reporting an increase in employment was 21 percent, down slightly from 23 percent last month. Firms also reported an increase in work hours this month: The average workweek index remained positive for the eighth consecutive month but decreased 1 point.

Price Indexes Are Mixed
The survey’s price indicators suggest little change in input price pressures in June, but more firms reported price increases for their own products this month. With regard to prices paid for inputs, 28 percent of the respondents reported higher input prices compared with 31 percent last month. The current prices paid index fell 1 point but has declined for three consecutive months. The prices received index, however, increased 5 points, with the percentage of firms reporting higher prices at 24 percent, up from 21 percent last month. The index remains well above its average readings of last year.

Firms Expect Growth, but Optimism Has Waned in Recent Months
Most of the survey’s six-month indicators decreased further from the higher readings seen at the beginning of the year. The diffusion index for future general activity decreased from 34.8 in May to 31.3 this month, its third consecutive decline (see Chart 1). Forty-two percent of the manufacturers expect increases in activity over the next six months, while 10 percent expect declines. The indexes for future new orders and shipments were mixed: The future new orders index decreased 15 points, while the future shipments index was virtually unchanged. The future employment diffusion index, at 30, increased 1 point. Thirty-four percent of the firms expect to increase employment over the next six months.

Most Firms Expect Increased Production in the Near Term
In this month’s special questions, firms were asked to estimate their total production growth for the second quarter ending this month along with expected growth for the third quarter (see Special Questions). The share of firms reporting increases in second-quarter production (60 percent) was greater than the share reporting decreases (17 percent). Looking ahead to the third quarter, 54 percent of the firms expect acceleration in the rate of production, while 18 percent of the firms expect deceleration. For those firms expecting an acceleration in production, 26 percent of the firms expect to hire additional workers. The remaining firms indicated that they would increase the work hours of current workers (36 percent) or increase productivity of current workers (36 percent) rather than increasing the number of workers.

Summary
Responses to the June Manufacturing Business Outlook Survey suggest continued growth for the region’s manufacturing sector. All the broad indicators remained at high positive readings, suggesting continued expansion. The survey’s employment indexes continued to reflect overall employment growth and an increase in workhours. Many of the indicators reflecting firms’ expectations for the next six months continued to retreat from recent highs but, on balance, suggest that growth is expected to continue through the end of the year.


FOMC target funds range raised to 1.00% - 1.25%
Posted: June 14, 2017 at 02:00 PM (Wednesday)

Information received since the Federal Open Market Committee met in May indicates that the labor market has continued to strengthen and that economic activity has been rising moderately so far this year. Job gains have moderated but have been solid, on average, since the beginning of the year, and the unemployment rate has declined. Household spending has picked up in recent months, and business fixed investment has continued to expand. On a 12-month basis, inflation has declined recently and, like the measure excluding food and energy prices, is running somewhat below 2 percent. Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations are little changed, on balance.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee continues to expect that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace, and labor market conditions will strengthen somewhat further. Inflation on a 12-month basis is expected to remain somewhat below 2 percent in the near term but to stabilize around the Committee's 2 percent objective over the medium term. Near term risks to the economic outlook appear roughly balanced, but the Committee is monitoring inflation developments closely.

In view of realized and expected labor market conditions and inflation, the Committee decided to raise the target range for the federal funds rate to 1 to 1-1/4 percent. The stance of monetary policy remains accommodative, thereby supporting some further strengthening in labor market conditions and a sustained return to 2 percent inflation.

In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to 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 and international developments. The Committee will carefully monitor actual and expected inflation developments relative to its symmetric inflation goal. The Committee expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run. However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data.

The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. The Committee currently expects to begin implementing a balance sheet normalization program this year, provided that the economy evolves broadly as anticipated. This program, which would gradually reduce the Federal Reserve's securities holdings by decreasing reinvestment of principal payments from those securities, is described in the accompanying addendum to the Committee's Policy Normalization Principles and Plans.

Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; Lael Brainard; Charles L. Evans; Stanley Fischer; Patrick Harker; Robert S. Kaplan; and Jerome H. Powell. Voting against the action was Neel Kashkari, who preferred at this meeting to maintain the existing target range for the federal funds rate.


Business Inventories down 0.2% in April
Posted: June 14, 2017 at 10:00 AM (Wednesday)

The combined value of distributive trade sales and manufacturers’ shipments for April, adjusted for seasonal and trading-day differences but not for price changes, was estimated at $1,352.0 billion, virtually unchanged (±0.2 percent)* from March 2017, but was up 5.6 percent (±0.3 percent) from April 2016.

Manufacturers’ and trade inventories, adjusted for seasonal variations but not for price changes, were estimated at an end-of-month level of $1,854.2 billion, down 0.2 percent (±0.1 percent) from March 2017, but were up 2.3 percent (±0.4 percent) from April 2016.

The total business Inventories/Sales Ratio based on seasonally adjusted data at the end of April was 1.37. The April 2016 ratio was 1.42.


Consumer Price Index decreased 0.1% in May, Ex Fd & Engy rose 0.1%
Posted: June 14, 2017 at 08:30 AM (Wednesday)

The Consumer Price Index for All Urban Consumers (CPI-U) decreased 0.1 percent in May on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index rose 1.9 percent.

A decrease in the energy index was the main contributor to the monthly decrease in the all items index. The energy index fell 2.7 percent, led by a decline of 6.4 percent in the gasoline index. The food index rose 0.2 percent, due to increases in four of the six major grocery store food group indexes.

The index for all items less food and energy rose 0.1 percent in May, as it did in April. The shelter index increased 0.2 percent over the month. However, many indexes declined in May, including those for apparel, airline fares, communication, and medical care services.

The all items index rose 1.9 percent for the 12 months ending May, a smaller increase than the 2.2- percent rise for the 12 months ending April. This month’s increase is still a larger rise than the 1.6- percent average annual increase over the past 10 years. The index for all items less food and energy rose 1.7 percent over the previous 12 months; this compares to a 1.8-percent average annual increase over the past decade. The energy index rose 5.4 percent over the last year, while the food index increased 0.9 percent.


Real Average Hourly Earnings increased 0.3% in May
Posted: June 14, 2017 at 08:30 AM (Wednesday)

Real average hourly earnings for all employees increased 0.3 percent from April to May, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This result stems from a 0.2-percent increase in average hourly earnings combined with a 0.1-percent decrease in the Consumer Price Index for All Urban Consumers (CPI-U).

Real average weekly earnings increased 0.3 percent over the month due to the increase in real average hourly earnings combined with no change in the average workweek.

Real average hourly earnings increased 0.6 percent, seasonally adjusted, from May 2016 to May 2017. The increase in real average hourly earnings combined with no change in the average workweek resulted in a 0.6-percent increase in real average weekly earnings over this period.


U.S. Retail Sales for May Decrease 0.3%, Ex-Auto down 0.3%
Posted: June 14, 2017 at 08:30 AM (Wednesday)

Advance estimates of U.S. retail and food services sales for May 2017, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $473.8 billion, a decrease of 0.3 percent (±0.5 percent)* from the previous month, and 3.8 percent (±0.9 percent) above May 2016. Total sales for the March 2017 through May 2017 period were up 4.4 percent (±0.7 percent) from the same period a year ago. The March 2017 to April 2017 percent change was unrevised at 0.4 percent (±0.1 percent).

Retail trade sales were down 0.3 percent (±0.5 percent)* from April 2017, and up 4.0 percent (±0.7 percent) from last year. Building Material and Garden Equipment and Supplies Dealers were up 10.8 percent (±1.8 percent) from May 2016, while Nonstore Retailers were up 10.2 percent (±1.8 percent) from last year.


Purchase Apps up, Refi's up in Latest MBA Weekly Survey
Posted: June 14, 2017 at 07:00 AM (Wednesday)

Mortgage applications increased 2.8 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending June 9, 2017. Last week's results included an adjustment for the Memorial Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 2.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 27 percent compared with the previous week. The Refinance Index increased 9 percent from the previous week to the highest level since November 2016. The seasonally adjusted Purchase Index decreased 3 percent from one week earlier. The unadjusted Purchase Index increased 19 percent compared with the previous week and was 8 percent higher than the same week one year ago.

The refinance share of mortgage activity increased to 45.4 percent of total applications from 42.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 7.4 percent of total applications. The average loan size for refinance applications reached the highest level since September 2016 at $274,700.

The FHA share of total applications increased to 11.2 percent from 10.6 percent the week prior. The VA share of total applications remained unchanged at 11.1 percent from the week prior. The USDA share of total applications remained unchanged at 0.8 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) decreased to 4.13 percent from 4.14 percent, with points increasing to 0.35 from 0.34 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $424,100) decreased to 4.06 percent from 4.08 percent, with points increasing to 0.24 from 0.21 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 4.00 percent from 4.01 percent, with points decreasing to 0.29 from 0.39 (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 3.37 percent from 3.39 percent, with points decreasing to 0.34 from 0.43 (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 3.26 percent from 3.19 percent, with points decreasing to 0.20 from 0.27 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.


Producer Price Index was unchanged in May, ex Fd & Engy down 0.1%
Posted: June 13, 2017 at 08:30 AM (Tuesday)

The Producer Price Index for final demand was unchanged in May, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices rose 0.5 percent in April and edged down 0.1 percent in March. On an unadjusted basis, the final demand index increased 2.4 percent for the 12 months ended in May.

Within final demand in May, a 0.3-percent increase in the index for final demand services offset a 0.5-percent decline in prices for final demand goods.

Prices for final demand less foods, energy, and trade services fell 0.1 percent in May, the first decline since a similar 0.1-percent decrease in May 2016. For the 12 months ended May 2017, the index for final demand less foods, energy, and trade services moved up 2.1 percent.


NFIB Small Business Optimism Index flat in May to 104.5
Posted: June 13, 2017 at 07:00 AM (Tuesday)

The May Index continues the remarkable surge in small business optimism that started the day after the election. Small-business confidence shot up to near record levels last November and still hasn’t come down. The Index for May matched its strong performance in April of 104.5. The Index has been at a historically high level for six straight months. In May, five of the Index components posted a gain, four declined, and one remained unchanged. Labor market indicators remained strong, capital spending remained high, and reports of improved sales trends also increased in frequency. However, the inventory picture deteriorated a bit with inventory satisfaction and plans slipping a combined 5 points from April. Overall, the outlook remained solid and more consistent with the revised Q1 2017 GDP growth of 1.2 percent.

The small business sector remains poised to do its part to contribute to overall economic growth. The heavy burden of taxes, health insurance and regulations must be eliminated to support their efforts. The New York Federal Reserve estimates second quarter growth at 2.2 percent while the Atlanta Federal Reserve anticipates growth at 3.4 percent. To appreciate the magnitude of that gap, 1.2 percentage points is equal to or greater than the growth of the entire economy in many quarters over the past eight years. Removing the penalties embedded in our tax code and regulatory structure which waste valuable time and hours will do much to speed up the growth rate, making the U.S. a growth leader.


Wholesale Inventories down 0.5% in April
Posted: June 10, 2017 at 10:00 AM (Saturday)

April 2017 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 $462.3 billion, down 0.4 percent (±0.5 percent)* from the revised March level, but were up 7.3 percent (±0.9 percent) from the April 2016 level. The February 2017 to March 2017 percent change was revised from the preliminary estimate of virtually unchanged (±0.4 percent)* to down 0.2 percent (±0.5 percent)*.

Total inventories of merchant wholesalers, except manufacturers’ sales branches and offices, after adjustment for seasonal variations but not for price changes, were $591.0 billion at the end of April, down 0.5 percent (±0.2 percent) from the revised March level. Total inventories were up 1.6 percent (±1.1 percent) from the revised April 2016 level. The March 2017 to April 2017 percent change was revised from the advance estimate of down 0.3 percent (±0.4 percent)* to down 0.5 percent (± 0.2 percent).

The April Inventories/Sales Ratio for merchant wholesalers, except manufacturers’ sales branches and offices, based on seasonally adjusted data, was 1.28. The April 2016 ratio was 1.35.


Weekly Initial Unemployment Claims Decrease 10,000 to 245,000
Posted: June 8, 2017 at 08:30 AM (Thursday)

In the week ending June 3, the advance figure for seasonally adjusted initial claims was 245,000, a decrease of 10,000 from the previous week's revised level. The previous week's level was revised up by 7,000 from 248,000 to 255,000. The 4-week moving average was 242,000, an increase of 2,250 from the previous week's revised average. The previous week's average was revised up by 1,750 from 238,000 to 239,750.
The advance seasonally adjusted insured unemployment rate was 1.4 percent for the week ending May 27, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending May 27 was 1,917,000, a decrease of 2,000 from the previous week's revised level. The previous week's level was revised up 4,000 from 1,915,000 to 1,919,000. The 4-week moving average was 1,914,750, a decrease of 750 from the previous week's revised average. This is the lowest level for this average since January 12, 1974 when it was 1,881,000. The previous week's average was revised up by 1,000 from 1,914,500 to 1,915,500.


Consumer Credit Increased at an annual rate of 2.50%
Posted: June 7, 2017 at 03:00 PM (Wednesday)

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


Purchase Apps up, Refi's up in Latest MBA Weekly Survey
Posted: June 7, 2017 at 07:00 AM (Wednesday)

Mortgage applications increased 7.1 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending June 2, 2017. This week's results included an adjustment for the Memorial Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 7.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 15 percent compared with the previous week. The Refinance Index increased 3 percent from the previous week. The seasonally adjusted Purchase Index increased 10 percent from one week earlier to its highest level since May 2010. The unadjusted Purchase Index decreased 14 percent compared with the previous week and was 6 percent higher than the same week one year ago.

The refinance share of mortgage activity decreased to 42.1 percent of total applications from 43.2 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 10.6 percent from 10.5 percent the week prior. The VA share of total applications increased to 11.1 percent from 10.8 percent the week prior. The USDA share of total applications remained unchanged at 0.8 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) decreased to its lowest level since November 2016, 4.14 percent, from 4.17 percent, with points increasing to 0.34 from 0.32 (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 $424,100) decreased to its lowest level since November 2016, 4.08 percent, from 4.11 percent, with points decreasing to 0.21 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 30-year fixed-rate mortgages backed by the FHA decreased to its lowest level since December 2016, 4.01 percent, from 4.03 percent, with points increasing to 0.39 from 0.32 (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 its lowest level since November 2016, 3.39 percent, from 3.42 percent, with points increasing to 0.43 from 0.39 (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 its lowest level since November 2016, 3.19 percent, from 3.22 percent, with points decreasing to 0.27 from 0.33 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.


Job Openings increased to a series high of 6.0 million in April
Posted: June 6, 2017 at 10:00 AM (Tuesday)

The number of job openings increased to a series high of 6.0 million on the last business day of April, the U.S. Bureau of Labor Statistics reported today. Over the month, hires decreased to 5.1 million and separations edged down to 5.0 million. Within separations, the quits rate and the layoffs and discharges rate were little changed at 2.1 percent and 1.1 percent, respectively. 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.


New orders for manufactured goods decreased 0.2% in April
Posted: June 5, 2017 at 10:00 AM (Monday)

New orders for manufactured goods in April, down following four consecutive monthly increases, decreased $0.8 billion or 0.2 percent to $469.0 billion, the U.S. Census Bureau reported today. This followed a 1.0 percent March increase. Shipments, up four of the last five months, increased $0.1 billion or virtually unchanged to $470.8 billion. This followed a 0.2 percent March decrease. Unfilled orders, up two consecutive months, increased $2.4 billion or 0.2 percent to $1,123.0 billion. This followed a 0.3 percent March increase. The unfilled orders-to-shipments ratio was 6.84, up from 6.81 in March. Inventories, up six consecutive months, increased $0.5 billion or 0.1 percent to $649.7 billion. This followed a 0.2 percent March increase. The inventories-to-shipments ratio was 1.38, unchanged from March.

New orders for manufactured durable goods in April, down following four consecutive monthly increases, decreased $1.8 billion or 0.8 percent to $231.0 billion, down from the previously published 0.7 percent decrease. This followed a 2.4 percent March increase. Transportation equipment, down following two consecutive monthly increases, led the decrease, $1.1 billion or 1.4 percent to $78.4 billion. New orders for manufactured nondurable goods increased $1.0 billion or 0.4 percent to $238.0 billion.


Employment Trends Index increased in May to 133.70
Posted: June 5, 2017 at 10:00 AM (Monday)

The Conference Board Employment Trends Index™ (ETI) increased in May, following an increase in April. The index now stands at 133.70, up from 132.77 (an upward revision) in April. The change represents a 6.4 percent gain in the ETI compared to a year ago.

“While employment numbers have shown some softness in the past three months, there is no slowdown visible in the Employment Trends Index, suggesting solid job growth over the summer,” said Gad Levanon, Chief Economist, North America, at The Conference Board. “Employment will likely grow fast enough to continue tightening the labor market.”

May’s increase in the ETI was fueled by positive contributions from seven of the eight components. In order from the largest positive contributor to the smallest, these were: Percentage of Respondents Who Say They Find “Jobs Hard to Get,” Ratio of Involuntarily Part-time to All Part-time Workers, Initial Claims for Unemployment Insurance, Industrial Production, Number of Employees Hired by the Temporary-Help Industry, Percentage of Firms with Positions Not Able to Fill Right Now, and Job Openings.


ISM Non-Manufacturing Index dipped to 56.9% in May
Posted: June 5, 2017 at 10:00 AM (Monday)

Economic activity in the non-manufacturing sector grew in May for the 89th consecutive month, say the nation's purchasing and supply executives in the latest Non-Manufacturing ISM® Report On Business®.

The NMI® registered 56.9 percent, which is 0.6 percentage point lower than the April reading of 57.5 percent. This represents continued growth in the non-manufacturing sector at a slightly slower rate. The Non-Manufacturing Business Activity Index decreased to 60.7 percent, 1.7 percentage points lower than the April reading of 62.4 percent, reflecting growth for the 94th consecutive month, at a slower rate in May. The New Orders Index registered 57.7 percent, 5.5 percentage points lower than the reading of 63.2 percent in April. The Employment Index increased 6.4 percentage points in May to 57.8 percent from the April reading of 51.4 percent. The Prices Index decreased 8.4 percentage points from the April reading of 57.6 percent to 49.2 percent, indicating prices decreased in May for the first time after 13 consecutive months of increasing. According to the NMI®, 17 non-manufacturing industries reported growth. Although the non-manufacturing sector’s growth rate dipped in May, the sector continues to reflect strength, buoyed by the strong rate of growth in the Employment Index. The majority of respondents’ comments continue to indicate optimism about business conditions and the overall economy.

INDUSTRY PERFORMANCE
The 17 non-manufacturing industries reporting growth in May — listed in order — are: Real Estate, Rental & Leasing; Construction; Accommodation & Food Services; Utilities; Arts, Entertainment & Recreation; Wholesale Trade; Mining; Health Care & Social Assistance; Management of Companies & Support Services; Professional, Scientific & Technical Services; Agriculture, Forestry, Fishing & Hunting; Retail Trade; Finance & Insurance; Public Administration; Transportation & Warehousing; Information; and Other Services. The only industry reporting contraction in May is Educational Services.


1Q2017 Productivity Growth Unch%
Posted: June 5, 2017 at 08:30 AM (Monday)

Nonfarm business sector labor productivity was unchanged during the first quarter of 2017, the U.S. Bureau of Labor Statistics reported today, as both output and hours worked increased 1.7 percent. (All quarterly percent changes in this release are seasonally adjusted annual rates.) From the first quarter of 2016 to the first quarter of 2017, productivity increased 1.2 percent, reflecting a 2.5-percent increase in output and a 1.3-percent increase in hours worked.

Unit labor costs in the nonfarm business sector increased 2.2 percent in the first quarter of 2017, reflecting a 2.2-percent increase in hourly compensation; productivity was unchanged. Unit labor costs increased 1.1 percent over the last four quarters.

Manufacturing sector labor productivity increased 0.5 percent in the first quarter of 2017, as output increased 2.6 percent and hours worked increased 2.1 percent. Output per hour decreased 0.7 percent in the durable goods manufacturing sector and increased 2.7 percent in the nondurable goods sector. Over the last four quarters, manufacturing sector productivity increased 0.3 percent, as output increased 0.9 percent and hours worked increased 0.6 percent. Unit labor costs in manufacturing increased 2.4 percent in the first quarter of 2017 and rose 2.9 percent from the same quarter a year ago.

Preliminary first-quarter 2017 measures were announced today for the nonfinancial corporate sector. Productivity decreased 1.5 percent in the first quarter of 2017 and decreased 0.1 percent over the last four quarters. Unit profits of nonfinancial corporations fell at a 6.6 percent annual rate in the first quarter of 2017 and fell 6.8 percent over the last four quarters.

Revised measures
In the first quarter of 2017, nonfarm business productivity was unchanged, rather than falling 0.6 percent as reported May 4, due to a 0.7-percentage point upward revision to output; hours worked were revised up 0.1 percentage point. Unit labor costs were revised down--due primarily to the upward revision to productivity--and increased 2.2 percent. In the manufacturing sector, productivity was revised up 0.1 percentage point and hourly compensation was revised up 0.4 percentage point, resulting in a 0.3 percentage point upward revision to unit labor costs.

In the fourth quarter of 2016, labor productivity in the business, nonfarm business, and manufacturing sectors increased at the same rates reported May 4. In the nonfarm business sector, hourly compensation was revised down, and decreased 3.0 percent, in contrast to the previously published estimate of a 3.1 percent increase. As a result, unit labor costs fell 4.6 percent in the fourth quarter of 2016, rather than increasing 1.3 percent. In the manufacturing sector, a downward revision to hourly compensation also led directly to a downward revision to unit labor costs, which declined 3.4 percent in the fourth quarter of 2016 rather than increasing 2.2 percent as previously published.

In the nonfinancial corporate sector, productivity fell 4.2 percent in the fourth quarter of 2016 rather than declining 1.0 percent as previously reported, due solely to a downward revision to output. Annual average productivity increased 0.4 percent from 2015 to 2016, slightly less than the 0.6-percent increase reported May 4. Unit profits of nonfinancial corporations fell 15.2 percent in the fourth quarter of 2016, rather than the decline of 17.9 percent reported May 4.


May Employment increased by 138,000
Unemployment Rate dipped to 4.3%

Posted: June 2, 2017 at 08:30 AM (Friday)

Total nonfarm payroll employment increased by 138,000 in May, and the unemployment rate was little changed at 4.3 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care and mining.

Household Survey Data
The unemployment rate, at 4.3 percent, and the number of unemployed persons, at 6.9 million, changed little in May. Since January, the unemployment rate has declined by 0.5 percentage point, and the number of unemployed has decreased by 774,000.

Among the major worker groups, the unemployment rate for Whites edged down to 3.7 percent in May. The jobless rates for Blacks (7.5 percent), Asians (3.6 percent), and Hispanics (5.2 percent), as well as those for adult men (3.8 percent), adult women (4.0 percent), and teenagers (14.3 percent), showed little or no change.

Among the unemployed, the number of job losers and persons who completed temporary jobs declined by 211,000 to 3.3 million in May. The number of long-term unemployed (those jobless for 27 weeks or more) was essentially unchanged over the month at 1.7 million and accounted for 24.0 percent of the unemployed.

The labor force participation rate declined by 0.2 percentage point to 62.7 percent in May but has shown no clear trend over the past 12 months. The employment-population ratio edged down to 60.0 percent in May.

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was little changed at 5.2 million in May. 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 May, 1.5 million persons were marginally attached to the labor force, down by 238,000 from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

Among the marginally attached, there were 355,000 discouraged workers in May, down by 183,000 from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.1 million persons marginally attached to the labor force in May had not searched for work for reasons such as school attendance or family responsibilities.

Establishment Survey Data
Total nonfarm payroll employment increased by 138,000 in May, compared with an average monthly gain of 181,000 over the prior 12 months. In May, job gains occurred in health care and mining.

Employment in health care rose by 24,000 in May. Hospitals added 7,000 jobs over the month, and employment in ambulatory health care services continued to trend up (+13,000). Job growth in health care has averaged 22,000 per month thus far in 2017, compared with an average monthly gain of 32,000 in 2016.

Mining added 7,000 jobs in May. Employment in mining has risen by 47,000 since reaching a recent low point in October 2016, with most of the gain in support activities for mining.

In May, employment in professional and business services continued to trend up (+38,000). The industry has added an average of 46,000 jobs per month thus far this year, in line with the average monthly job gain in 2016.

Employment in food services and drinking places also continued to trend up in May (+30,000) and has grown by 267,000 over the past 12 months.

Employment in other major industries, including construction, manufacturing, wholesale trade, retail trade, transportation and warehousing, information, financial activities, and government, showed little change over the month.

The average workweek for all employees on private nonfarm payrolls was unchanged at 34.4
hours in May. In manufacturing, the workweek also was unchanged at 40.7 hours, while overtime edged up by 0.1 hour to 3.3 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls edged down by 0.1 hour to 33.6 hours.

In May, average hourly earnings for all employees on private nonfarm payrolls rose by 4 cents to $26.22. Over the year, average hourly earnings have risen by 63 cents, or 2.5 percent. In May, average hourly earnings of private-sector production and nonsupervisory employees increased by 3 cents to $22.00.

The change in total nonfarm payroll employment for March was revised down from +79,000 to +50,000, and the change for April was revised down from +211,000 to +174,000. With these revisions, employment gains in March and April combined were 66,000 less than previously reported. Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors. Over the past 3 months, job gains have averaged 121,000 per month.


Goods and Services Deficit Increased in April 2017
Posted: June 2, 2017 at 08:30 AM (Friday)

The Nation's international trade deficit in goods and services increased to $47.6 billion in April from $45.3 billion in March (revised), as exports decreased and imports increased.

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 $47.6 billion in April, up $2.3 billion from $45.3 billion in March, revised. April exports were $191.0 billion, $0.5 billion less than March exports. April imports were $238.6 billion, $1.9 billion more than March imports.

The April increase in the goods and services deficit reflected an increase in the goods deficit of $2.3 billion to $68.4 billion and a decrease in the services surplus of less than $0.1 billion to $20.8 billion.

Year-to-date, the goods and services deficit increased $22.1 billion, or 13.4 percent, from the same period in 2016. Exports increased $44.3 billion or 6.1 percent. Imports increased $66.4 billion or 7.5 percent.


New York Purchasing Managers Business Activity dropped in May to 46.7
Posted: June 2, 2017 at 08:30 AM (Friday)

New York City purchasing managers balanced short term uncertainty with persistent long term optimism in May, according to the survey taken by the Institute for Supply Management-New York. Three survey indices pulled back to levels not seen since before the Presidential election: Current Business Conditions (October), Employment (September), and Current Revenues (August). Despite this, forward looking optimism and expected revenues remained in growth territory.

New York Metro
Current Business Conditions came in at 46.7 in May, falling below the breakeven point for the first time since October of 2016. The Six-Month Outlook decreased to 70.6 in May, continuing to decrease from the 3-year high seen back in March, but staying squarely in growth territory. The six-month outlook has been a reliable short-run guide for current business conditions over time.

Company Specific
Employment, a seasonally adjusted index, decreased to 40.3 in May, falling to the lowest level since September of 2016. Quantity of Purchases rose to 55.3 in May after dropping below the breakeven point in April. News for the top line and forward guidance demonstrate forward looking optimism in May. Current Revenues held steady for the first time since August of 2016, breaking even at 50.0 in May. Expected Revenues rose to 66.7 a slight increase over the 65.5 seen in April.
Prices Paid also held steady at 50.0 in May, falling from 54.7 in April.


Construction Spending decreased 1.4% in April
Posted: June 1, 2017 at 10:00 AM (Thursday)

Construction spending during April 2017 was estimated at a seasonally adjusted annual rate of $1,218.5 billion, 1.4 percent (±1.0 percent) below the revised March estimate of $1,235.5 billion. The April figure is 6.7 percent (±1.5 percent) above the April 2016 estimate of $1,142.5 billion. During the first 4 months of this year, construction spending amounted to $359.5 billion, 5.8 percent (±1.3 percent) above the $339.7 billion for the same period in 2016.

Private Construction
Spending on private construction was at a seasonally adjusted annual rate of $943.3 billion, 0.7 percent (± 0.8 percent)* below the revised March estimate of $949.7 billion. Residential construction was at a seasonally adjusted annual rate of $516.7 billion in April, 0.7 percent (±1.3 percent)* below the revised March estimate of $520.4 billion. Nonresidential construction was at a seasonally adjusted annual rate of $426.6 billion in April, 0.6 percent (± 0.8 percent)* below the revised March estimate of $429.3 billion.

Public Construction
In April, the estimated seasonally adjusted annual rate of public construction spending was $275.3 billion, 3.7 percent (±2.0 percent) below the revised March estimate of $285.9 billion. Educational construction was at a seasonally adjusted annual rate of $70.7 billion, 2.0 percent (±2.6 percent)* below the revised March estimate of $72.2 billion. Highway construction was at a seasonally adjusted annual rate of $89.5 billion, 3.7 percent (±5.8 percent)* below the revised March estimate of $93.0 billion.


April Manufacturing ISM registered 54.9
Posted: June 1, 2017 at 10:00 AM (Thursday)

Economic activity in the manufacturing sector expanded in May, and the overall economy grew for the 96th consecutive month, say the nation's supply executives in the latest Manufacturing ISM® Report On Business®.

The May PMI® registered 54.9 percent, an increase of 0.1 percentage point from the April reading of 54.8 percent. The New Orders Index registered 59.5 percent, an increase of 2 percentage points from the April reading of 57.5 percent. The Production Index registered 57.1 percent, a 1.5 percentage points decrease compared to the April reading of 58.6 percent. The Employment Index registered 53.5 percent, an increase of 1.5 percentage points from the April reading of 52 percent. The Inventories Index registered 51.5 percent, an increase of 0.5 percentage point from the April reading of 51 percent. The Prices Index registered 60.5 percent in May, a decrease of 8 percentage points from the April reading of 68.5 percent, indicating higher raw materials prices for the 15th consecutive month, but at a noticeably slower rate of increase in May compared with April. Comments from the panel generally reflect stable to growing business conditions, with new orders, employment and inventories of raw materials all growing in May compared to April. The slowing of pricing pressure, especially in basic commodities, should have a positive impact on margins and buying policies as this moderation moves up the value chain.

Of the 18 manufacturing industries, 15 reported growth in May in the following order: Nonmetallic Mineral Products; Furniture & Related Products; Plastics & Rubber Products; Machinery; Primary Metals; Food, Beverage & Tobacco Products; Electrical Equipment, Appliances & Components; Paper Products; Miscellaneous Manufacturing; Computer & Electronic Products; Transportation Equipment; Chemical Products; Fabricated Metal Products; Petroleum & Coal Products; and Printing & Related Support Activities. Two industries reported contraction in May compared to April: Apparel, Leather & Allied Products; and Textile Mills.


Weekly Initial Unemployment Claims Increase 13,000 to 248,000
Posted: June 1, 2017 at 08:30 AM (Thursday)

In the week ending May 27, the advance figure for seasonally adjusted initial claims was 248,000, an increase of 13,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 234,000 to 235,000. The 4-week moving average was 238,000, an increase of 2,500 from the previous week's revised average. The previous week's average was revised up by 250 from 235,250 to 235,500.

The advance seasonally adjusted insured unemployment rate was 1.4 percent for the week ending May 20, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending May 20 was 1,915,000, a decrease of 9,000 from the previous week's revised level. The previous week's level was revised up 1,000 from 1,923,000 to 1,924,000. The 4-week moving average was 1,914,500, a decrease of 16,000 from the previous week's revised average. This is the lowest level for this average since January 12, 1974 when it was 1,881,000. The previous week's average was revised up by 250 from 1,930,250 to 1,930,500.


ADP National Employment Report increased by 253,000 jobs in May
Posted: June 1, 2017 at 08:15 AM (Thursday)

Private sector employment increased by 253,000 jobs from April to May according to the May ADP National Employment Report®.

“May proved to be a very strong month for job growth,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. “Professional and business services had the strongest monthly increase since 2014. This may be an indicator of broader strength in the workforce since these services are relied on by many industries.”

Mark Zandi, chief economist of Moody’s Analytics said, “Job growth is rip-roaring. The current pace of job growth is nearly three times the rate necessary to absorb growth in the labor force. Increasingly, businesses’ number one challenge will be a shortage of labor.”


Challenger Layoffs increased to 51,692 jobs in May
Posted: June 1, 2017 at 07:30 AM (Thursday)

The number of workforce reductions announced by US-based employers rose sharply in May, as planned job cuts totaled 51,692 for the month. Nearly 40 percent of those job cuts were announced by Ford Motor Company, according to the report released Thursday from global outplacement consultancy Challenger, Gray & Christmas, Inc.

May job cuts were 41 percent higher than the 36,602 job cuts announced in April, and 71 percent higher than the same month last year, when employers shed 30,157 jobs.

Employers have announced a total of 214,495 job cuts so far this year. That is down 28 percent from the 275,218 job cuts that occurred last year through May 2016.

“Ford’s announcement of 20,000 global layoffs to streamline and cut costs is a typical strategy of large corporations who need to pivot to stay competitive. As consumers demand electric and self-driving options, traditional auto makers will need to adapt,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

The automotive industry led all industries last month with 20,271 job cuts, bringing the year-to-date total to 28,996. Retailers continue to announce the most job cuts this year with 55,910, 5,777 of which occurred in May.

“The retail industry is still shedding jobs. We are now seeing the effect of changing consumer behavior in grocery shopping.

“Grocery stores are no longer immune from online shopping. Meal delivery services and Amazon are competing with traditional grocers, and Amazon announced it is opening its first ever brick-and mortar store in Seattle. Amazon Go, which mixes online technology and the in-store experience, is something to keep an eye on since it may potentially change the grocery store shopping experience considerably,” said Challenger.


Beige Book: Economic Activity continued to expand at a modest or moderate pace
Posted: May 31, 2017 at 02:00 PM (Wednesday)

Most of the twelve Federal Reserve Districts reported that their economies continued to expand at a modest or moderate pace from early April through late May. Boston and Chicago signaled that growth in their Districts had slowed somewhat to a modest pace since the prior Beige Book period, while New York indicated that activity had flattened out. Consumer spending softened with many Districts noting little or no change in nonauto retail sales, while auto sales have edged down from last year's record highs in several Districts; tourism activity has continued to keep pace with the general economy. Meanwhile, the majority of Districts continued to report moderate growth in manufacturing activity and in most nonfinancial service sectors. Construction of new homes and nonresidential structures also continued to grow at modest to moderate rates, as did sales of existing homes; nonresidential leasing picked up a bit. Lending volume trends tended to mirror (and support) the general activity of the economy. Agricultural conditions remained mixed with some regions negatively affected by unusually wet weather. Most energy sectors tended to modestly improve. A majority of Districts reported that firms expressed positive near-term outlooks; however, optimism waned somewhat in a few Districts.

Employment and Wages
Labor markets continued to tighten, with most Districts citing shortages across a broadening range of occupations and regions. Despite supply constraints impeding the ability of firms to attract and retain qualified workers, most Districts reported that employment continued to grow at a modest to moderate pace. Similarly, most firms across the Districts noted little change to the recent trend of modest to moderate wage growth, although many firms reported offering higher wages to attract workers where shortages were most severe. A manufacturing firm in the Chicago District reported attracting better applicants and improving retention for its unskilled workforce by raising wages 10 percent.

Prices
On balance, pricing pressures were little changed from the prior report, with most Districts reporting modest increases. Rapidly rising costs for lumber, steel, and other commodities tended to push input costs higher for some manufacturers and the construction sector. In contrast, some Districts noted falling prices for certain final goods, including groceries, apparel, and autos. Energy prices and farm prices were mixed across products and among Districts. Low inventories of for-sale homes were pushing house prices higher in many markets.


Help Wanted OnLine Labor Demand increased 195,600 to 4,809,200 in May
Posted: May 31, 2017 at 10:00 AM (Wednesday)

Online advertised vacancies increased 195,600 to 4,809,200 in May, according to The Conference Board Help Wanted OnLine® (HWOL) Data Series,released today. The April Supply/Demand rate stands at 1.53 unemployed for each advertised vacancy, with a total of 2.4 million more unemployed workers than the number of advertised vacancies. The number of unemployed was approximately 7.1 million in April.

The Professional occupational category saw gains in Healthcare Practitioners (46.4), Computer/Math (25.2), and Management (23.8). The Services/Production occupational category saw gains in Sales (31.8) and Office and Administrative Support (30.6).


Pending Home Sales Index decreased 1.3% in April
Posted: May 31, 2017 at 10:00 AM (Wednesday)

Pending home sales in April slumped for the second consecutive month and were down year-over-year nationally and in all four major regions, according to the National Association of Realtors®. Only the West saw an increase in contract signings last month.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, decreased 1.3 percent to 109.8 in April from a downwardly revised 111.3 in March. After last month's decline, the index is now 3.3 percent below a year ago, which is the first year-over-year decline since last December and the largest since June 2014 (7.1 percent).

Lawrence Yun, NAR chief economist, says contract activity is fading this spring because significantly weak supply levels are spurring deteriorating affordability conditions. "Much of the country for the second straight month saw a pullback in pending sales as the rate of new listings continues to lag the quicker pace of homes coming off the market," he said. "Realtors® are indicating that foot traffic is higher than a year ago, but it's obviously not translating to more sales."

Added Yun, "Prospective buyers are feeling the double whammy this spring of inventory that's down 9.0 percent from a year ago and price appreciation that's much faster than any rise they've likely seen in their income."

Unfortunately, Yun believes there is little evidence these astoundingly low supply levels are going away soon. Homebuilding activity has not picked up enough this year and too few homeowners are listing their home for sale.

"The unloading of single-family homes purchased by real estate investors during the downturn for rental purposes would also go a long way in helping relieve these inventory shortages," said Yun. "To date, there are no indications investors are ready to sell. However, they should be mindful of the fact that rental demand will soften as the overall population of young adults starts to shrink in roughly five years."

Yun forecasts existing-home sales to be around 5.64 million this year, an increase of 3.5 percent from 2016 (5.45 million). The national median existing-home price this year is expected to increase around 5 percent. In 2016, existing sales increased 3.8 percent and prices rose 5.1 percent.

The PHSI in the Northeast decreased 1.7 percent to 97.2 in April, and is now 0.6 percent below a year ago. In the Midwest the index fell 4.7 percent to 104.4 in April, and is now 6.1 percent lower than April 2016.

Pending home sales in the South declined 2.7 percent to an index of 125.9 in April and are now 2.3 percent below last April. The index in the West jumped 5.8 percent in April to 100.0, but is still 4.2 percent below a year ago.


Chicago Purchasing Managers Index up by 1.1 points to 59.4 in May
Posted: May 31, 2017 at 09:45 AM (Wednesday)

The MNI Chicago Business Barometer increased to 59.4 in May from 58.3 in April, the highest level since November 2014.

Optimism among firms about business conditions rose for the fourth consecutive month. Four of the five Barometer components led May’s increase, with only New Orders receding.

After rising for three consecutive months, demand lost ground in May. New orders fell by 4.5 points to 61.4 in May. In contrast, Production continued to strengthen. The indicator was up 3.7 points to 63.2 from 59.5 in April. Order Backlogs jumped out of contractionary territory after five months of decline. Suppliers took longer to deliver key inputs, with the respective indicator at 59.6 compared with 56.0 in April. There were reports of longer delivery times due to suppliers running out of products because of maintaining low inventories.

Companies accumulated inventories at faster pace yet again in anticipation of a busy summer. The Inventories indicator was up by 2.2 points to 55.5 in May.

The Employment indicator was 3.3 points above last month’s level. Although the indicator has expanded only eight times in last 24 months, it is showing tentative signs of a pick-up, sitting above 50 in two of the last three months. Panelists reported a rise in temporary hires and cut down of executive level positions to manage costs.

This month’s special question asked firms if they planned to expand their workforce in the next three months. Over half of respondents planned on hiring, a sign that businesses were optimistic about demand in the summer. While a third of respondents did not intend on hiring, 14% of them were unsure. Of those who were keen on expanding their workforce, 40% intended on hiring permanent employees, 33% on temporary employees and 27% expected a mix of both permanent and temporary employees. When the same question was posed in May 2014, the majority preferred a more permanent setup rather than a flexible and contingent workforce.

Inflationary pressures at the factory gate eased for the third consecutive month. Though Prices Paid remain above 50, implying inflation, the growth rate has eased in recent months. Panelists reported a continued rise in the price of steel and plastic products.

“May’s rise in the MNI Chicago Business Barometer provides a further boost to the business environment. Rising pressure on backlogs and delivery times accompanied with higher production levels suggests firms’ expectations of a busy summer,” said Shaily Mittal, senior economist at MNI Indicators.


Purchase Apps down, Refi's down in Latest MBA Weekly Survey
Posted: May 31, 2017 at 07:00 AM (Wednesday)

Mortgage applications decreased 3.4 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending May 26, 2017.

The Market Composite Index, a measure of mortgage loan application volume, decreased 3.4 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 decreased 6 percent from the previous week. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 3 percent compared with the previous week and was 7 percent higher than the same week one year ago.

The refinance share of mortgage activity decreased to 43.2 percent of total applications from 43.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.7 percent of total applications.

The FHA share of total applications decreased to 10.5 percent from 10.8 percent the week prior. The VA share of total applications increased to 10.8 percent from 10.5 percent the week prior. The USDA share of total applications remained unchanged at 0.8 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) remained unchanged at 4.17 percent, with points decreasing to 0.32 from 0.39 (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 $424,100) remained unchanged at 4.11 percent, with points decreasing to 0.30 from 0.31 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 4.03 percent from 4.07 percent, with points decreasing to 0.32 from 0.34 (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 3.42 percent from 3.45 percent, with points increasing to 0.39 from 0.38 (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 3.22 percent from 3.27 percent, with points decreasing to 0.33 from 0.35 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.


Texas Fed Manufacturing Activity Increased at a faster pace in May
Posted: May 30, 2017 at 10:30 AM (Tuesday)

Texas factory activity increased at a faster pace in May, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, moved up eight points to 23.3, reaching its highest level since April 2014.

Other measures of current manufacturing activity also rose to levels not seen since mid-2014. The new orders index pushed up to 18.1, and the growth rate of orders index rose to 12.3, marking its fifth consecutive positive reading. The capacity utilization index moved up to 19.4, with roughly a third of firms noting increased utilization. The shipments index surged 15 points to 24.7, reaching a level not seen in nearly 10 years.

Perceptions of broader business conditions improved again in May. The general business activity index held fairly steady at 17.2, and the company outlook index rose five points to 20.2.

Labor market measures indicated continued employment gains and markedly longer workweeks this month. The employment index came in at 8.3, posting a fifth positive reading in a row. Eighteen percent of firms noted net hiring, compared with 10 percent noting net layoffs. The hours worked index shot up 10 points to 15.7, its highest reading in six years.

Prices continued to rise in May, albeit at a somewhat slower pace, while wage pressures increased. Upward pressure on input costs receded slightly again, with the raw materials prices index falling three points to 17.5. Upward pressure on selling prices also abated, with the finished goods prices index falling from 12.0 to 5.9. The wages and benefits index, however, rose to 24.3, indicating a stronger rise in compensation costs than was seen in April.

Expectations regarding future business conditions continued to improve. The indexes of future general business activity and future company outlook came in at 31.6 and 30.9, respectively, up several points from last month’s readings. Other indexes for future manufacturing activity pushed further into positive territory.


Consumer Confidence declined slightly in May to 117.9
Posted: May 30, 2017 at 10:00 AM (Tuesday)

The Conference Board Consumer Confidence Index®, which had decreased in April, declined slightly in May. The Index now stands at 117.9 (1985=100), down from 119.4 in April. The Present Situation Index increased marginally from 140.3 to 140.7, while the Expectations Index declined from 105.4 last month to 102.6 in May.

The monthly Consumer Confidence Survey®, based on a probability-design random sample, is conducted for The Conference Board by Nielsen, a leading global provider of information and analytics around what consumers buy and watch. The cutoff date for the preliminary results was May 18.

“Consumer confidence decreased slightly in May, following a moderate decline in April,” said Lynn Franco, Director of Economic Indicators at The Conference Board. “However, consumers’ assessment of present-day conditions held steady, suggesting little change in overall economic conditions. Looking ahead, consumers were somewhat less upbeat than in April, but overall remain optimistic that the economy will continue expanding into the summer months.”

Consumers’ appraisal of current conditions held steady in May. Those saying business conditions are “good” edged down from 30.8 percent to 29.4 percent, but those saying business conditions are “bad” was unchanged at 13.7 percent. Consumers’ assessment of the labor market also remained positive. Those stating jobs are “plentiful” declined marginally from 30.3 percent to 29.9 percent, however, those claiming jobs are “hard to get” decreased from 19.4 percent to 18.2 percent.

Consumers were less optimistic about the short-term outlook in May. The percentage of consumers expecting business conditions to improve over the next six months decreased from 25.1 percent to 21.3 percent, however, those expecting business conditions to worsen declined marginally from 10.4 percent to 10.1 percent.

Consumers’ outlook for the labor market was mixed. The proportion expecting more jobs in the months ahead declined from 21.9 percent to 18.6 percent, but those anticipating fewer jobs decreased from 13.8 percent to 12.0 percent. The percentage of consumers expecting their incomes to increase edged up from 18.7 percent to 19.2 percent, but the proportion expecting a decrease also rose, from 7.6 percent to 8.7 percent.


S&P CoreLogic Case-Shiller Home Price Indices gained 0.8% in March
Posted: May 30, 2017 at 09:00 AM (Tuesday)

S&P Dow Jones Indices today released the latest results for the S&P CoreLogic Case-Shiller Indices, the leading measure of U.S. home prices. Data released today for March 2017 shows that home prices continued their rise across the country over the last 12 months.

YEAR-OVER-YEAR
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 5.8% annual gain in March, up from 5.7% last month and setting a 33-month high. The 10-City Composite and the 20-City Composite indices came in at 5.2% and 5.9% annual increases, respectively, unchanged from last month.

Seattle, Portland, and Dallas reported the highest year-over-year gains among the 20 cities. In March, Seattle led the way with a 12.3% year-over-year price increase, followed by Portland with 9.2%, and Dallas with an 8.6% increase. Ten cities reported higher price increases in the year ending March 2017 than in the year ending February 2017.

The below charts compare year-over-year returns for Seattle and Portland with different ranges of housing prices (tiers). Upon tier level analysis from 2011 to present, both Seattle and Portland’s year-over-year returns show housing prices in the high tier to be the most stable while housing prices in the low tier are most volatile.

MONTH-OVER-MONTH
Before seasonal adjustment, the National Index posted a month-over-month gain of 0.8% in March. The 10-City Composite posted a 0.9% increase and the 20-City Composite reported a 1.0% increase. After seasonal adjustment, the National Index recorded a 0.3% month-over-month increase. Both the 10-City Composite and the 20-City Composite indices posted a 0.9% month-over-month increase after seasonal adjustment. Eighteen of the 20 cities reported increases in March before seasonal adjustment; after seasonal adjustment, 17 cities saw prices rise.

ANALYSIS
“Home prices continue rising with the S&P Corelogic Case-Shiller National Index up 5.8% in the year ended March, the fastest pace in almost three years,” says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “While there is some regional variation, prices are rising across the U.S. Half of the 20 cities tracked by the S&P Corelogic Case-Shiller indices rose more than 6% from March 2016 to March 2017. The smallest gain of 4.1%, in New York, was roughly double the rate of inflation.

“Sales of both new and existing homes, housing starts and the National Association of Home Builders’ sentiment index are all trending higher. Over the last year, analysts suggested that one factor pushing prices higher was the unusually low inventory of homes for sale. People are staying in their homes longer rather than selling and trading up. If mortgage rates, currently near 4%, rise further, this could deter more people from selling and keep pressure on inventories and prices. While prices cannot rise indefinitely, there is no way to tell when rising prices and mortgage rates will force a slowdown in housing.”

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, which covers all nine U.S. census divisions, recorded a 5.8% annual gain in March 2017. The 10-City and 20-City Composites reported year-over-year increases of 5.2% and 5.9%, respectively. As of March 2017, average home prices for the MSAs within the 10-City and 20-City Composites are back to their winter 2007 levels.


Personal Income increased 0.4%, Spending increased 0.4%
Posted: May 30, 2017 at 08:30 AM (Tuesday)

Personal income increased $58.4 billion (0.4 percent) in April according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $56.5 billion (0.4 percent) and personal consumption expenditures (PCE) increased $53.2 billion (0.4 percent).

Real DPI increased 0.2 percent in April and Real PCE increased 0.2 percent. The PCE price index increased 0.2 percent. Excluding food and energy, the PCE price index increased 0.2 percent.


Paychex-IHS Small Business Jobs Index declined to 100.34 in May
Posted: May 30, 2017 at 08:30 AM (Tuesday)

The Paychex | IHS Markit Small Business Employment Watch for May shows a continued decline in small business jobs growth, but an increase in wages for the fourth consecutive month. According to the report, the Small Business Jobs Index declined 0.16 percent in May to 100.34, a 0.25 percent decrease in growth year-over-year and its weakest three-month change since July 2009 (-0.44 percent). National hourly earnings in April were $25.76, increasing 2.87 percent ($0.72) year-over-year.

"After peaking in February, the Small Business Jobs Index has dropped to its lowest reading since October 2015," said James Diffley, chief regional economist at IHS Markit.

"The increased pace of small business employment growth that we saw following the election of President Trump has slowed," said Martin Mucci, Paychex president and CEO. "Small business owners now seem to be taking a more wait-and-see approach to hiring. Despite that, wages continue to rise, which is certainly good news for workers."


University of Michigan Consumer Confidence increased in April to 97.1
Posted: May 26, 2017 at 10:00 AM (Friday)

Consumer sentiment has continued to move along the high plateau established following Trump’s election. The May 2017 figure was virtually unchanged from the April reading, and nearly identical with the December to May average of 97.3. Moreover, the partisan divide between Democrats and Republicans has also remained largely unchanged, with the first expecting a recession and the other more robust economic growth. Despite the expected bounce back in spending in the current quarter, personal consumption is expected to advance by 2.3% in 2017, although this is based on averages across the political divide, which has never been as extreme as it is currently.

Partisan Impact on Personal Finances
More consumers reported an improved financial situation in May than anytime in the past dozen years. The financial strength was due to gains in incomes as well as gains in household wealth driven by rising stock prices and home values. Few consumers complained about inflation eroding their living standards, and the highest proportion in a decade expected inflation adjusted income gains during the year ahead.

Partisan Economic Outlook
Selective perception of economic news still dominates. Favorable news about recent economic developments were reported by 84% of Republicans but just 37% of Democrats; unfavorable developments were reported by just 19% of Republicans but by 73% of Democrats. The difference involved references to jobs and economic policies, with Republicans holding more favorable views on jobs and policies than Democrats. The impact of this divide led most Republicans to expect a robust expansion and most Democrats to anticipate a recession.

The Consumer Sentiment Index was 97.1 in May 2017, just above the 97.0 in April, and above last May’s 94.7. The Current Conditions Index was 111.7 in May, between April’s 112.7 and above last May’s 109.9. The Expectations Index was 87.7 in May, just ahead of April’s 87.0 and last May’s 84.9. All three Indices have remained quite favorable and have exhibited little variation in the past six months.

How long will economic expectations be dominated by partisanship? Unlike differences in expectations across age, education, or income groups, which usually reflect actual differences in prospects for employment and income expectations, for example, partisanship is reflected in economic policy preferences. Since no major policies, such as healthcare, taxes, or infrastructure spending have yet been adopted, the partisan divide may reflect differences in policy preferences expressed as expected economic outcomes. Thus, the extreme partisan divide may persist until passage is deemed either inevitable or impossible. While extremes may well narrow, it is unlikely that the impact of partisanship on economic expectations will disappear.


1Q2017 GDP preliminary estimate increased 1.2%
Posted: May 26, 2017 at 08:30 AM (Friday)

Real gross domestic product (GDP) increased at an annual rate of 1.2 percent in the first quarter of 2017, according to the "second" estimate released by the Bureau of Economic Analysis. In the fourth quarter, real GDP increased 2.1 percent.

The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month. In the advance estimate, the increase in real GDP was 0.7 percent. With this second estimate for the first quarter, the general picture of economic growth remains the same; increases in nonresidential fixed investment and in personal consumption expenditures (PCE) were larger and the decrease in state and local government spending was smaller than previously estimated. These revisions were partly offset by a larger decrease in private inventory investment.

Real gross domestic income (GDI) increased 0.9 percent in the first quarter, in contrast to a decrease of 1.4 percent (revised) in the fourth. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased 1.0 percent in the first quarter, compared with an increase of 0.3 percent in the fourth quarter.

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

The deceleration in real GDP in the first quarter primarily reflected a downturn in private inventory investment and a deceleration in PCE that were partly offset by an upturn in exports and an acceleration in nonresidential fixed investment.

Current-dollar GDP increased 3.4 percent, or $158.2 billion, in the first quarter to a level of $19,027.6 billion. In the fourth quarter, current-dollar GDP increased 4.2 percent, or $194.1 billion.

The price index for gross domestic purchases increased 2.6 percent in the first quarter, compared with an increase of 2.0 percent in the fourth quarter (table 4). The PCE price index increased 2.4 percent, compared with an increase of 2.0 percent. Excluding food and energy prices, the PCE price index increased 2.1 percent, compared with an increase of 1.3 percent.

The percent change in real GDP was revised up from the advance estimate, reflecting upward revisions to nonresidential fixed investment, PCE, and state and local government spending that were partly offset by a downward revision to private inventory investment. For more information, see the Technical Note. For information on updates to GDP, see the “Additional Information” section that follows.

For the fourth quarter of 2016, the percent change in real GDI was revised from 1.0 percent to -1.4 percent based on newly available fourth-quarter tabulations from the BLS Quarterly Census of Employment and Wages program.

Profits from current production (corporate profits with inventory valuation adjustment and capital consumption adjustment) decreased $40.3 billion in the first quarter, in contrast to an increase of $11.2 billion in the fourth quarter.

Profits of domestic financial corporations decreased $28.4 billion in the first quarter, in contrast to an increase of $26.5 billion in the fourth quarter. Profits of domestic nonfinancial corporations decreased $18.4 billion, compared with a decrease of $60.4 billion. The rest-of-the-world component of profits increased $6.5 billion, compared with an increase of $45.1 billion. This measure is calculated as the difference between receipts from the rest of the world and payments to the rest of the world. In the first quarter, receipts increased $11.8 billion, and payments increased $5.3 billion.


April New Orders for Durable Goods Decreased 0.7%, Ex-Trans down 0.4%
Posted: May 26, 2017 at 08:30 AM (Friday)

New Orders
New orders for manufactured durable goods in April decreased $1.6 billion or 0.7 percent to $231.2 billion, the U.S. Census Bureau announced today. This decrease, down following four consecutive monthly increases, followed a 2.3 percent March increase. Excluding transportation, new orders decreased 0.4 percent. Excluding defense, new orders decreased 0.8 percent. Transportation equipment, down following two consecutive monthly increases, led the decrease, $1.0 billion or 1.2 percent to $78.5 billion.

Shipments
Shipments of manufactured durable goods in April, down three of the last four months, decreased $0.7 billion or 0.3 percent to $233.0 billion. This followed a 0.1 percent March decrease. Transportation equipment, down six of the last seven months, led the decrease, $0.4 billion or 0.5 percent to $77.2 billion.

Unfilled Orders
Unfilled orders for manufactured durable goods in April, up two consecutive months, increased $2.4 billion or 0.2 percent to $1,122.9 billion. This followed a 0.3 percent March increase. Transportation equipment, also up two consecutive months, led the increase, $1.3 billion or 0.2 percent to $766.6 billion.


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