2ndQ2015 GDP Initial
- Real GDP quarter/quarter seasonally adjusted, annualized +2.3%. Previous was revised up to +0.6%
- GDP price index quarter/quarter seasonally adjusted, annualized +2.0%. Previous was +0.1%.
- Real Final Sales of Domestic Goods was +2.4%. This filters out imports, exports and business spending.
Coming after a miserable 1stQ a reading of +2.3% is weak.
Average GDP growth has been about +2.3% for the past 3 years. That is weak.
The present state of affairs indicates that the dual mandate of the Federal Reserve: keep unemployment low and keep inflation in check misses the point that keeping GDP growing is at least as important. The Fed is in a spot where extremely low interest rates and massive expansion of Monetary base have failed to spur GDP. The Fed may want to reduce money supply simply so that they can increase it again if necessary. Increasing rates before problems in the EU and China are fixed would be a big mistake. Higher rates in the U.S. would hurt Europe at a time when it doesn't need hurting.
Initial Jobless Claims (week ended 7/25/2014)
- New Claims 267,000. Previous was 255,000
- 4-week Moving Average 274,750. Previous was 278,250.
Employment Cost Index (2ndQ2015)
- ECI quarter/quarter +0.2%. Previous was +0.7% - ECI year/year +2.0%. Previous was +2.6%.
The +0.2% Q/Q increase is the smallest in the 33 year history of this index.
Chicago PMI (July 2015)
- Business Barometer Index 54.7. Previous was 49.4
Consumer Sentiment (July 2015)
- Sentiment 93.1. Previous was 93.3.
This is the University of Michigan Index. This is a survey index which questions 500 households each month on their financial conditions and attitudes about the economy. It is supposed to be a leading indicator of Consumer Spending in the next 90 days. This Index had been deteriorating slightly since the start of this calendar year.
Posted at 07:31 AM in Mortgage Market Daily Commentary | Permalink | Comments (0)
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