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Sep 19, 2019
Initial claims for unemployment insurance benefits should continue to ease recession concerns. In new filings there is no sign of a significant issue in either the labor market or the broader economy. Jobless claims inched higher in the week ended September 14, from a revised 206,000 (previously 204,000) to 208,000. Claims remain low and suggest that even though business confidence has weakened noticeably, it hasn't led firms to lay off workers. The four-week moving average slipped. The new data include the September payroll reference week and suggest job growth remained solid. Continuing claims declined by 13,000 to 1.661 million in the week ended September 7 and the insured unemployment rate remained at 1.2%.
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Sep 18, 2019
Housing starts recovered in August, gaining 12.3% above the revised July estimate and being 6.6% above total starts from August 2018. The increase in starts was led by multifamily construction, though single-family starts also showed a strong gain. Starts increased in three of the four census regions, with only the West lagging. Housing permits also increased in August, implying that the next two months should also see rising housing starts.
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Sep 17, 2019
Net long-term capital flows increased for the fourth straight month in July. Net inflows totaled $84.3 billion, down from inflows of $100.6 billion in June. Net purchases of long-term U.S. securities by foreign residents totaled $72.3 billion. Private foreign investors accounted for the bulk of the purchases, with net purchases totaling $83.8 billion. Official foreign investors were net sellers of U.S. securities in July, reducing their holdings by $11.5 billion. Meanwhile, U.S. residents sold $12 billion of long-term foreign securities.
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Sep 17, 2019
Total U.S. household borrowing tacked on 0.33% in August, equivalent to $44 billion. All consumer lending categories except home equity and student loans experienced growth. Total dollar delinquency rates increased by 0.08 percentage point to 2.39%.
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Sep 17, 2019
Homebuilder sentiment inched up 1 point to 68 in September. The builder outlook is unarguably positive, with the index reaching its highest mark this year, and is now 18 points above the 50-point threshold, signaling a healthy market. Out of the three subcomponents, current sales and buyer traffic improved this month while sales expectations declined slightly. Three of the regional housing market indexes increased while the fourth index held constant. Builders will remain in good shape in the short term.
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Sep 17, 2019
Industrial production rose 0.6% in August, its third increase in the last four months. The decrease for July was revised upward. August's print was more than our above-consensus forecast. The results were positive across industries. Mining led the top-line print, rising 1.4%, while manufacturing advanced 0.5%. Above-average temperatures in August drove a 0.6% increase in utilities production. Total capacity utilization rose 0.4 percentage point and that for manufacturing gained 0.3 percentage point.
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Sep 17, 2019
Canadian manufacturing sales suffered a worse-than-expected loss in July as shipments of metals and motor vehicles contracted. Sales tumbled 1.3% from the prior month, leaving them 1.9% below their year-ago level. Manufacturers suffered another setback as the U.S.-China trade war weighs on global demand and confidence sags.
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Sep 16, 2019
President Trump's trade war with China and a potential Brexit have undermined global business confidence. Sentiment is down sharply across the globe since this time last year and is consistent with a global economy that is struggling to grow. Businesses' assessments of present conditions and their expectations regarding the outlook into early next year are especially negative.
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Sep 16, 2019
Manufacturers in New York remain cautiously optimistic based on the September Empire State Manufacturing Survey. The top-line general business conditions index fell from 4.8 to 2, keeping it just slightly above its neutral threshold for a third consecutive month. Components were mixed, with demand indicators inching lower but employment measures moving in the right direction following some signs of trouble in August. The forward-looking general business conditions index fell 12 points to 13.7, indicating that some pessimism is beginning to creep into factories' expectations.
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Sep 16, 2019
A significant outflow of portfolio investment from Canadians in July generated the largest net monthly outflow of funds in 2019. Foreign investors' positions were little changed, with a net reduction of C$1.2 billion in Canadian securities. However, Canadian investors added C$12.5 billion in foreign securities to their holdings, the largest monthly increase in nearly a year.
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Sep 16, 2019
The global economy has grown at a steady clip over the past couple of quarters, but trade tensions between the U.S. and some of its trading partners and the fading impact of the fiscal stimulus in the U.S. have weighed on growth. According to our estimates, global real GDP rose 2.5% at an annualized rate in the second quarter, compared with the 3.1% annualized gain in the prior three months. Global growth has clearly slowed over the past year, as it was up 2.6% on a year-ago basis in the second quarter, compared with 3.3% in a comparable period in 2018.
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Sep 11, 2019
Wholesale inventories began the third quarter with a soft gain. Stockpiles rose 0.2% in July following a revised 0.1% decline in June (previously unchanged). The performance was split among the categories. Durable goods slipped 0.2% over the month while nondurable goods surged 0.8%. Wholesale sales increased 0.3% in July, keeping the inventory-to-sales ratio level at 1.36.
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Sep 05, 2019
The four-week moving average in our U.S. policy uncertainty index edged higher, rising from 143 to 143.5 in the week ended August 30. The four-week moving average had been trending higher since the trade tensions between the U.S. and China took a turn for the worse in early May. The trade tensions are clearly on businesses' minds, as references to trade uncertainty in the Fed's Beige Book remain high. Also, the Challenger Report noted that trade difficulties led businesses to lay off more than 10,000 workers in August.
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Sep 03, 2019
For the first time since the end of the energy rout, the U.S. manufacturing sector is contracting. The ISM manufacturing index fell from 51.2 in July to 49.1 in August, the lowest reading since January 2016 and below the 50 threshold that is consistent with expansion. The details were generally downbeat. The new orders, production and employment indexes all slipped below 50. The supplier deliveries index also declined, but this is an improvement that indicates a softer slowdown in deliveries. The inventories index increased slightly but also remained below the 50 threshold. The good news is that the ISM manufacturing index remains well above its recession threshold of 42.9.
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Sep 03, 2019
The CoreLogic Home Price Index increased 3.6% year over year in July, a slight improvement over the 3.4% pace in June before revisions. Monthly growth also ticked up, to 0.5%.
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Aug 01, 2019
Job cuts fell to 38,845 in July, down 7.5% from June but 43.2% higher than a year ago. The industries with the most layoffs were transportation and industrial goods, which accounted for 25.6% of announced layoffs. Firms reported branch closings and corporate restructurings as the most prevalent reasons for layoffs in July. These two factors have accounted for 45% of job cut announcements year to date. Hiring announcements through the first seven months of the year doubled compared with the same period in 2018.
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Jul 26, 2019
U.S. GDP growth slowed in the second quarter, according to the advance report from the Bureau of Economic Analysis. Real GDP grew 2.1%, after growing 3.1% in the first quarter after annual revision. The weakening came despite an acceleration in consumer spending growth as inventory accumulation slowed, the trade deficit widened, and fixed investment fell. Real disposable income growth slowed to 2.5% from a revised 4.4%. The saving rate fell to 8.1%, from a revised 8.5%. Revisions showed faster GDP growth in 2017, but similar annual growth in other years.
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Jul 25, 2019
Manufacturing conditions in the 10th District weakened slightly in July with factory activity contracting for the first time since August 2016. The composite index has decreased in four consecutive months. The details were generally unchanged from the previous reading. Production levels and order backlogs remained negative, and readings for employment and the average employee workweek entered negative territory this month. Price indexes for raw materials increased from last month and from a year earlier, while prices for finished products are largely unchanged. Expectations of future manufacturing conditions continue to weaken but remain positive overall.
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Jul 25, 2019
The homeownership rate decreased in the second quarter of 2019, reinforcing the decline in the previous quarter. The rate in the second quarter fell to 64.1%, compared with 64.2% in the first quarter of 2019 and 64.3% a year ago. The rental vacancy rate retreated to 6.8% from 7% in the first quarter of 2019.
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Jun 21, 2019
Thanks to falling mortgage rates, existing-home sales for May recovered some of the pace that was lost in March and April. Total sales increased 2.5% for the month but are still down 1.1% from May 2018. Listings were able to keep up with the increase so that the inventory-to-sales ratio stayed level. Also, the increase in sales was uniform between single-family and condo/co-op homes. The May increase in sales was spread out, with all four census regions recording good sales increases for the month.
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Jun 21, 2019
State and regional employment numbers for May provide more evidence of increasing business caution in response to slower economic growth and rising trade risks. The data do not show worrying signs of weakening in the labor market at this point, but there is broad slowing in job growth across regions at a time when most state economies are operating at or beyond full employment. In May, fewer states reported higher unemployment and lower unemployment. Year-over-year job growth is strongest in Nevada (4%), followed by Utah and Washington (2.8% each). Vermont had the lowest unemployment rate, at 2.1%, and Texas and Vermont set new lows for the series dating back to 1976.
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Jun 20, 2019
Household financial burdens are low and nearly steady. The financial obligations ratio rose 3 basis points to 15.38% in the first quarter and is up 6 basis points over the preceding year. The debt service ratio rose 2 basis points to 9.91% from its prior level and is also up 6 basis points over the last year. The increase came from the consumer debt service ratio. The mortgage ratio dipped 1 basis point in the quarter. Growth in debt payments and obligations slowed in the first quarter but remained modestly above slowing income growth.
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May 30, 2019
The increase in natural gas inventories surpassed analyst predictions, which will apply downward pressure on gas prices. Working gas in underground storage rose by 114 billion cubic feet during the week ended May 24, below consensus expectations of a 98-bcf build.
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May 30, 2019
The St. Louis Fed Financial Stress Index increased for the third straight week as the U.S.-China trade war continued to weigh on market sentiment. The stress index rose 1 basis point to -1.24 for the week ended May 24. Selling in U.S. equity markets intensified last week, with the Standard & Poor's 500 falling 1.2%. The fear of a global economic slowdown is driving investors to safer assets, including U.S. Treasuries. The two-year Treasury yield fell 4 basis points to 2.16%, while the 10-year Treasury yield fell 7 basis points to 2.32%. Measures of corporate credit risk were negative.
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May 29, 2019
The Moody's Analytics nominal house price index was up 6.1% on a year-ago basis in the first quarter of 2019, compared with the revised 6.2% gain in the fourth quarter of last year (previously 7%). Over the past couple of years, nominal house prices have been rising by 6% to 7%. Adjusted for inflation, global house prices were up 2.2% on a year-ago basis in the first three months of this year, matching the gain in the fourth quarter of last year. Growth in real house prices have clearly decelerated over the past couple of years.
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May 22, 2019
The Moody's Delinquency Tracker total delinquency rate for commercial mortgage-backed securities declined 10 basis points to 3.53% in April. The decrease in delinquencies stemmed mainly from retail for the month. Three of the six property types declined, two held steady and one inched upward. Additionally, all regional delinquency rates, except the East, fell in April. Meanwhile, payoffs and dispositions outweighed new issuance in the month, decreasing the total balance of CMBS conduit loans.
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