Redbook Chain Store Sales (week ended 6/24/2017)

- Store Sales year/year +2.2%. Previous was +2.8%

S&P Corelogic Case-Shiller HPI (April 2017)

- 20-city seasonally adjusted month/month +0.3%. Previous was +0.5%
- 20-city not seasonally adjusted month/month +0.9%. Previous was +1.0%
- 20-city not seasonally adjusted year/year +5.7%. Previous was +5.9%

Slower increases in housing prices are necessary if more people are going to be able to buy a home.

 

Consumer Confidence (June 2017)

- Consumer Confidence 118.9. Previous was 117.6

This is the metric from The Conference Board.

 

Richmond Federal Reserve Manufacturing Index (June 2017)

- level 7. Previous was 1.

PMI Composite Flash (June 2017)

- Composite 53.0. Previous was 53.9
- Manufacturing 52.1. Previous was 52.5
- Services 53.0. Previous was 54.0

Growth but at a slower pace.

New Home Sales (May 2017)

- New Home Sales seasonally adjusted, annualized 610,000. Previous was 569,000.

This has been bouncing up and down but has been displaying a general upward trend for several years.

Initial Jobless Claims (week ended 6/17/2017)

- New Claims seasonally adjusted 241,000. Previous was 238,000
- New Claims unadjusted, totaled 228,461 decrease of 5,724 from previous
- 4-week Moving Average seasonally adjusted 244,750. Previous was 243,250

Jobless Claims remain low. Nonetheless this has not resulted in sharp increases in wages and had not spurred GDP.

 

FHFA House Price Index (April 2017)

- month/month +0.7%. Previous was 0.7%
- year/year +6.8%. Previous was 6.4%

A reminder that we have not had a housing recovery but a house price recovery. A housing recovery would happen when Housing Starts rise to 1,500,000. Prices are rising because supply is insufficient in those places where folks want to live.

 

Leading Indicators (May 2017)

- Leading Indicators month/month +0.3%. Previous was +0.2%

This is made up from 10 other indicators and is supposed to indicate economic activity 3-6 months from now.

 

Kansas City Federal Reserve Manufacturing Index (June 2017)

- Level 11. Previous was 8.

MBA Mortgage Applications (week ended 6/16/2017)

- Purchase Index Week/Week -1.0%. Previous weeks were -3.0%, +10.0%, -1.0%, -1.0%, -3.0%, +2.0%, +4.0%, -1.0%, -3.0%, +3.0%, +1.0%, +1.0%, and -2.0%.
- Refinance Index Week/Week +2.0%. Previous weeks were +9.0%, +3.0%, -6.0%, +11.0%, -6.0%, +3.0%, -5.0%, +7.0%, +0.2%, +0.0%,-4.0%, -3.0%, and -3.0%.
- Composite Index Week/Week -0.6%. Previous weeks were +2.8%, +7.1%, -3.4%, +4.4%, -4.1%, +2.4%, -0.1%, +2.7%, -1.8%, +1.5%, -1.6%, -0.8%, and -2.7%.

I keep reading in online commentary that the housing market is making a comeback. A more accurate description is that housing prices have made a comeback. Ultimately the housing market is about Housing Starts. Ten years after a dramatic drop Housing Starts are still not close to recovering.

 

Existing Home Sales (May 2017)

- Existing Home Sales seasonally adjusted, annualized 5,620,000. Previous was 5,560,000
- Existing Home Sales month/month +1.1%. Previous was -2.5%
- Existing Home Sales year/year +2.7%. Previous was +1.6%.

Existing Home Sales were up for the month. This related to what I said above. We are not building enough housing to keep pace with population growth. This makes Existing Homes the only choice for most folks buying a home.

Redbook Chain Store Sales (week ended 6/17/2017)

- Store Sales year/year +2.8%. Previous was +2.1%.

As chain store outlets close this data becomes less meaningful because it only compares stores till open.

Housing Starts (May 2017)

- Starts seasonally adjusted, annualized rate 1,092,000. Previous was 1,156,000
- Permits seasonally adjusted, annualized rate 1,168,000. Previous was 1,228,000

Strong Housing Starts are a sign of economic health. People get jobs, save some money, buy a house, raise a family. Not so much any more. This is a seriously depressing report. Single- family Starts were down 3.9%. Multi-family was down 9.7%. In order to keep the headship ratio (number of people per household) constant we need 1,500,000 Housing Starts/year. The last time we had that was December 2006. It may be time to realize that we may never get back to that level.

 

Atlanta Federal Reserve Business Inflation Expectations (June 2017)

- Business Inflation Expectation year/year 2.0%. Previous was 2.0%

 

Consumer Sentiment (June 2017)

- Sentiment Index 94.5. Previous was 97.1.

This is the University of Michigan Index. Data is from a survey.

Initial Jobless Claims (week ended 6/10/2017)

- New Claims seasonally adjusted 237,000. Previous was 245,000
- New Claims, unadjusted, totaled 233,579 an increase of 21,309 from previous
- 4-week Moving Average 243,000. Previous was 242,000

 

Philadelphia Federal Reserve Business Outlook Survey (June 2017)

- General Business Conditions Index 27.6. Previous was 38.8

Empire State Manufacturing Survey (June 2017)

- General Business Conditions Index 19.8. Previous was -1.0

Import and Export Prices (May 2017)

- Import Prices month/month -0.3%. Previous was +0.2%
- Export Prices month/month -0.7%. Previous was +0.2%
- Import Prices year/year +2.1%. Previous was +4.1%
- Export Prices year/year +1.4%. Previous was +3.0%

This is an excellent example of why looking at one month can mislead. April had inflation showing levels of concern which subsequently disappeared.

 

Industrial Production (May 2017)

- Production month/month +0.0%. Previous was +1.1%
- Manufacturing month/month -0.4%. Previous was +1.1%
- Capacity Utilization Rate 76.6%. Previous was 76.7%

The fact is that manufacturing remains weak.

 

Housing Market Index (June 2017)

- Housing Market Index 67. Previous was 69.

This is a survey index based on data taken by the National Association of Home Builders. It appears to be leveling off.

MBA Mortgage Applications (week ended 6/9/2017)

- Purchase Index Week/Week -3.0%. Previous weeks were +10.0%, -1.0%, -1.0%, -3.0%, +2.0%, +4.0%, -1.0%, -3.0%, +3.0%, +1.0%, +1.0%, -2.0%, and +2.0%.
- Refinance Index Week/Week +9.0%. Previous weeks were +3.0%, -6.0%, +11.0%, -6.0%, +3.0%, -5.0%, +7.0%, +0.2%, +0.0%,-4.0%, -3.0%, -3.0%, and +4.0%.
- Composite Index Week/Week +2.8%. Previous weeks were +7.1%, -3.4%, +4.4%, -4.1%, +2.4%, -0.1%, +2.7%, -1.8%, +1.5%, -1.6%, -0.8%, -2.7%, and +3.1%.

Data for the past 2 weeks may be confusing because of the large seasonal adjustment for the previous week, a consequence of the Memorial Day holiday. Unadjusted was +19% week/week and +8% year/year. This indicates strength in home sales.

Consumer Price Index (May 2017)

- CPI month/month -0.1%. Previous was +0.2%
- CPI year/year +1.9%. Previous was +2.2%
- CPI less food & energy month/month +0.1%. Previous was +0.1%
- CPI less food & energy year/year +1.7%. Previous was +1.9%

Inflation remains subdued.

Retail Sales (May 2017)

- Retail Sales month/month -0.3%. Previous was +0.4%
- Retail Sales less autos month/month -0.3%. Previous was +0.4%
- Less Autos & Gas month/month 0.0%. Previous was +0.5%

This decline in Retail Sales is across the board: cars, restaurants, department stores, and electronics.

Business Inventories (April 2017)

- Inventories month/month -0.2. Previous was +0.2%

This is a component of 2ndQ2017 GDP.

NFIB Small Business Optimism Index (May 2017)

- level 104.5. Previous was 104.5.

Small business remains rather optimistic. This is survey data and will lead to growth only if this optimism is acted on.

 

 

Wholesale Inflation. PPI-FD (May 2017)

- PPI-FD overall month/month 0.0%. Previous was +0.5%
- PPI-FD overall year/year +2.4%. Previous was +2.5%
- PPI-FD core (less food & energy) month/month +0.3%. Previous was +0.4%
- PPI-FD core (less food & energy) year/year +2.1%. Previous was +1.9%
- PPI-FD core (less food, energy & trade services) month/month -0.1%. Previous was +0.7%
- PPI-FD core (less food, energy & trade services) year/year +2.1%. Previous was +2.1%

Weak in April, up in May, flat in June. No pattern here and little sign of inflation.

 

Redbook Chain Store Sales (week ended 6/10/2017)

- Store Sales year/year +2.1%. Previous was +2.5%

Initial Jobless Claims (week ended 6/3/2017)

- New Claims seasonally adjusted 245,000. Previous was 255,000
- New Claims unadjusted, totaled 212,189 a decrease of 19,398 from previous
- 4-week Moving Average 242,000. Previous was 238,000

By historical standards Jobless Claims remain very low disguising the fact that we are adding jobs which do not pay well. There is a large disconnect between the unemployment rate and economic growth (GDP.)