GDP (4thQ2019)

- Real GDP quarter/quarter, seasonally adjusted annualized rate 2.1%. Previous was 2.1%
- Real Consumer Spending seasonally adjusted annualized rate 1.8%. Previous was 3.2%
- GDP price index seasonally adjusted annualized rate  1.4%. Previous was 1.4%

The headline is deceptively good. The concern is that Consumer Spending (which is what drives the economy) had a significant drop.

My weekly newsletter of next Monday will take a look inside this report.

Source:  Bureau of Economic Analysis

 

 

Initial Jobless Claims (week ended 1/25/2019)

- New Claims seasonally adjusted   216,000. Previous was 223,000
- New Claims not seasonally adjusted  totaled 228,386 a decrease of 53,702  from previous
- 4-week Moving Average seasonally adjusted  214,500. Previous was 216,250

The jobs market remains extremely healthy.

Source: Department of Labor  Details: https://www.dol.gov/ui/data.pdf

MBA Mortgage Applications (week ended 1/24/2020)

- Purchase Index week/week +5.0%. Previous weeks were -2.0%, +16.0%, +5.0%, -5.0%, -2.0%, -0.4%, +1.0%, -1.0%, +7.0%, +5.0%, -3.0%, +2.0%, and -4.0%,
- Refinance Index Week/Week +8.0%. Previous weeks were -2.0%, +43.0%, -8.0%, -5.0%, -7.0%, +9.0%, -16.0%, +4.0%, -8.0%, +13.0%, +2.0%, -1.0%, and -17.0%
- Composite Index Week/Week +7.2%. Previous weeks were -1.2% +30.2%, -1.5%, -5.3%, -5.0%, +3.8%, -9.2%, +1.5%, -2.2%, +9.6%, -0.1%, +0.6%, and -11.9%

Source:  Mortgage Bankers Association

Goods Trade Deficit  (December 2019)

- Deficit  $68.3 billion. Previous was $63.0 billion
- Exports  change 0.3%. Previous was 0.8%
- Imports  change 2.9%. Previous was -1.3%

This is a component of 4thQ2019 GDP which will be released tomorrow.

Source: Bureau of Economic Analysis.

 

Retail Inventories (December 2019)

- month/month change 0.0%. Previous was -0.8%

Another 4thQ GDP component.
Source: Census Bureau

 

Wholesale Inventories  (December 2019)

- month/month change -0.1%. Previous was +0.1%

Another 4thQ GDP component.
Source: Census Bureau

Pending Home Sales Index (December 2019)

- Pending Home Sales Index month/month -4.9%. Previous was +1.2%

Source: National Association of Realtors

 

Durable Goods Orders  (December 2019)

- New Orders month/month   2.4%. Previous was -3.1%
- Ex-transportation month/month  -0.1%. Previous was -0.4%
- Core capital goods month/month -0.9%. Previous was  0.1%

Durables are about manufacturing, construction and defense.  DGO have been weak.  The increase in December was entirely due to defense orders.

Source:  Census Bureau.  Details: https://www.census.gov/manufacturing/m3/adv/pdf/durgd.pdf

 

Redbook Chain Store Sales (week ended 1/25/2019)

- Same Store Sales year/year 5.5%. Previous was +5.3%.
- Same Store Sales month/month 0.0%. Previous was -0.0%

Chain store sales data is difficult to interpret because the data only includes stores currently open which were open a year ago.  The effect of closed chain stores is not accounted for.

The data includes about 9,000 stores.

Source: Redbook Research Inc.

 

S&P Corelogic Case-Shiller House Price Index (November 2019)

- 20-city, seasonally adjusted month/month 0.5%. Previous was 0.4%
- 20-city, not seasonally adjusted year/year 0.1%. Previous was 0.1%
- 20-city,  not seasonally adjusted year/year 2.6%. Previous was 2.2%

The largest increases were in Phoenix, Charlotte, and Tampa.

 

Consumer Confidence  (January 2020)

- Consumer Confidence 131.6. Previous was 128.2.

This is the metric from the Conference Board.  It is supposed to forecast spending in the next 3-6 months.

 

Richmond Federal Reserve Manufacturing Index  (January 2020)

- Level 20. Previous was -5.

 

FOMC meeting starts today.  No move is expected. What will be of interest is what they say about Open Market Operations and future QE and if they address the fact that it is the Liquidity Coverage Ratio requirements of Basel III which have necessitated Fed intervention in the overnight market.

 

 

New Home Sales  (December 2019)

- New Home Sales seasonally adjusted, annualized rate  694,000. Previous was 719,000

This is single-family residences only.  This is a 5 month low and makes 3 consecutive months of decline. There were sizable differences by region.  West was +31% month/month. South and

Northeast were down.  This is more likely about lack of supply than lack of demand.  Housing Starts and permits are increasing.

Source:  Census Bureau  Details here: https://www.census.gov/construction/nrs/pdf/newressales.pdf

 

Dallas Federal Reserve Manufacturing Survey  (January 2020)

- Production Index 10.5. Previous was 3.6 
- General Activity Index  -0.2 . Previous was  -3.2

This has been weak since last May.

Source:  Dallas Federal Reserve Details:  https://www.dallasfed.org/research/surveys/tmos/2020/2001.aspx

 

Initial Jobless Claims  (week ended 1/18/2020)

- Initial Claims seasonally adjusted   211,000. Previous was 205,000
- Initial Claims unadjusted, totaled 267,582 a decrease of 70,968  from previous
- 4-week Moving Average seasonally adjusted 2213,250. Previous was 216,500

Seasonal adjustments remain relatively large post-Christmas and the jobs market remains extremely strong.

Source: Department of Labor Details here: https://www.dol.gov/ui/data.pdf 

Leading Indicators  (December 2019)

- Leading Indicators month/month-0.3%. Previous was +0.1%.

This is supposed to forecast the economy 3-6 months from now.

Source: Conference Board.  Details: https://www.conference-board.org/data/bcicountry.cfm?cid=1

MBA Mortgage Applications (week ended 1/17/2020)

- Purchase Index week/week -2.0%. Previous weeks were +16.0%, +5.0%, -5.0%, -2.0%, -0.4%, +1.0%, -1.0%, +7.0%, +5.0%, -3.0%, +2.0%, -4.0%, and -4.0%
- Refinance Index Week/Week -2.0%. Previous weeks were +43.0%, -8.0%, -5.0%, -7.0%, +9.0%, -16.0%, +4.0%, -8.0%, +13.0%, +2.0%, -1.0%, -17.0%, and +4.0%
- Composite Index Week/Week -1.2%. Previous weeks were +30.2%, -1.5%, -5.3%, -5.0%, +3.8%, -9.2%, +1.5%, -2.2%, +9.6%, -0.1%, +0.6%, -11.9%, and +0.5%

Source:  Mortgage Bankers Association

Chicago Federal National Activity Index  (December 2019)

- Level   -0.35. Previous was 0.41
- 3 Month Moving Average -0.23. Previous was -0.31 

This is a weighted average of 85 existing monthly indicators of national economic activity and inflationary pressure. This dip was unexpected.

Source:  Chicago Federal Reserve  Details here:  https://www.chicagofed.org/~/media/publications/cfnai/2020/cfnai-january2020-pdf.pdf?la=en

Redbook Chain Store Sales (week ended 1/18/2019)

- Same Store Sales year/year 5.3%. Previous was +5.0%.
- Same Store Sales month/month 0.0%. Previous was -0.2%

Chain store sales data is difficult to interpret because the data only includes stores currently open which were open a year ago.  The effect of closed chain stores is not accounted for.

The data includes about 9,000 stores.

Source: Redbook Research Inc.

 

FHFA House Price Index  (November 2019)

- month/month 0.2%. Previous was 0.2%
- year/year 4.9%. Previous was 5.0%

Slowing or no increase in home prices will make housing more affordable. Home prices have increased so much because of regulations inhibiting supply.

Source:   Federal Housing Finance Agency (FHFA)

 

Existing Home Sales  (December 2019)

- Existing Home Sales seasonally adjusted, annualized rate 5,540,000. Previous was 5,350,000
- Existing Home Sales month/month 3.6%. Previous was -1.7%
- Existing Home Sales year/year 10.8%. Previous was 2.7%

Source:  National Association of Realtors  https://www.nar.realtor/research-and-statistics/housing-statistics/existing-home-sales

 

Housing Starts  (December 2019)

- Starts seasonally adjusted, annualized rate 1,608,000. Previous was 1,375,000
- Permits seasonally adjusted, annualized rate 1,416,000. Previous was 1,482,000

While it is good to see starts above the 1,500,000 needed to take care of population growth and units lost or scrapped for the first time since 2006 let's see if this persists.  The drop in permits is of concern. Also, the entire gain month/month is in the mid-west with the other 3 regions down.  Don't cheer just yet.

I have written articles on why zoning and land use regulation have hurt starts and why rent control will reduce supply.

Why Housing Prices Are Rising
https://www.scotsmanguide.com/Residential/Articles/2018/02/Viewpoint--Why-Housing-Prices-Are-Rising

Don’t Repeal the Law of Supply and Demand
This past fall, California lawmakers passed a statewide rent-control bill.
https://www.scotsmanguide.com/browse/content/dont-repeal-the-law-of-supply-and-demand

Source:  Census Bureau  Details here:  https://www.census.gov/construction/nrc/pdf/newresconst.pdf

 

Industrial Production/Capacity Utilization  (December 2019)

- Production month/month       -0.3%. Previous was +0.8%
- Manufacturing month/month 0.2%. Previous was +1.0%
- Capacity Utilization Rate    77.0%. Previous was 76.6%

Down again after a month of gain.  The  blue collar part of the economy remains soft.

Source:  Federal Reserve

 

Consumer Sentiment  (January 2020)

- Sentiment Index  99.1. Previous was 99.3

This is the survey index from the University of Michigan.

 

 

JOLTS (November 2019)

- Job Openings 6,800,000. Previous was 7,361,000

December Jobs Reports shows 5,753,000 unemployed.

This represents Job Opening and after increasing for 6 years has more of less flattened since last Spring.

We still have a situation where unemployment is low, Job Openings exceed the U3 level of unemployment but wages remain flat.

Source:  Labor Department

 

Initial Jobless Claims (week ended 1/11/2020)

- New Claims seasonally adjusted 204,000. Previous was 214,000
- New Claims unadjusted, totaled 336,892 an increase of 1,412 from previous
- 4-week Moving Average 216,250. . Previous was 224,000 

We are in the post-Christmas part of the year where seasonal adjustments are high and will remain sos for two more weeks.

The jobs market remains extremely strong.

Source: Department of Labor    Details: https://www.dol.gov/ui/data.pdf  

 

Philadelphia Fed Business Outlook Survey  (January 2020)

- General Business Conditions Index 17.0. Previous was 0.3  

Source:  Philadelphia Federal Reserve

 

Retail Sales  (December 2019)

- Retail Sales month/month 0.3%. Previous was 0.3%
- Retail Sales less autos month/month 0.7%. Previous was 0.0%
- Less Autos & Gas month/month 0.5%. Previous was -0.2%

While overall sales growth is modest the "less autos" is strong. The auto industry is hurting.  This is the most important component of GDP.

Source:  Census Bureau Details: https://www.census.gov/retail/marts/www/marts_current.pdf

 

Import and Export Prices  (December 2019)

- Import Prices month/month 0.3%. Previous was +0.2%
- Export Prices month/month    -0.2%. Previous was +0.2%
- Import Prices year/year 0.5%. Previous was -1.3%
- Export Prices year/year      -0.7%. Previous was -1.3%

Prices are likely being affected by tariffs and weakening economies in our trading partners. The spike in import prices was led by oil and oil prices have since declined.

Source: Bureau of Labor Statistics  Details: https://www.bls.gov/news.release/ximpim.nr0.htm

 

Business Inventories  (November 2019)

- Inventories month/month -0.2%. Previous was +0.1%

This is a component of 4thQ GDP.

Source:  Census Bureau Details:  https://www.census.gov/mtis/www/data/pdf/mtis_current.pdf

 

Housing Market Index  (January 2020)

- Housing Market Index 75. Previous was 76.

This is a survey index from the National Association of Home Builders.

MBA Mortgage Applications (week ended 1/10/2020)

- Purchase Index week/week  +16.0%. Previous weeks were +5.0%, -5.0%, -2.0%, -0.4%, +1.0%, -1.0%, +7.0%, +5.0%, -3.0%, +2.0%, -4.0%, -4.0%, and -1.0%
- Refinance Index Week/Week +43.0%. Previous weeks were -8.0%, -5.0%, -7.0%, +9.0%, -16.0%, +4.0%, -8.0%, +13.0%, +2.0%, -1.0%, -17.0%, +4.0%, and +10.0%
- Composite Index Week/Week +30.2%. Previous weeks were -1.5%, -5.3%, -5.0%, +3.8%, -9.2%, +1.5%, -2.2%, +9.6%, -0.1%, +0.6%, -11.9%, +0.5%, and +5.2%

Distortions caused by the Christmas and New Year's holidays make this data less than useful.  This happens each year.

Source:  Mortgage Bankers Association

 

PPI  (December 2019)

- PPI-FD month/month 0.1%. Previous was 0.0%
- PPI-FD year/year 1.3%. Previous was 1.1%
- PPI-FD core (less food & energy) month/month 0.1%. Previous was -0.2%
- PPI-FD core (less food & energy) year/year 1.1%. Previous was 1.3%
- PPI-FD less food, energy & trade services month/month 0.1%. Previous was 0.0%
- PPI-FD less food, energy & trade services year/year 1.5%. Previous was 1.3%

Well contained inflation should keep Treasury yields and mortgage rates in check.

Source:  Bureau of Labor Statistics

 

Atlanta Federal Reserve Business Inflation Expectations  (January 2020)

- Business Inflation Expectations  1.9%. Previous was 1.9%.

This is a survey index. 

Source:  Atlanta Federal Reserve  Details:  https://www.frbatlanta.org/research/inflationproject/bie.aspx

CPI  (December 2019)

- CPI month/month 0.2%. Previous was 0.3%
- CPI year/year  2.3%. Previous was 2.1%
- CPI core (less food & energy) month/month 0.1%. Previous was 0.2%
- CPI core (less food & energy) year/year 2.3%. Previous was 2.3%

Low unemployment is not translating into inflation.

Source: Bureau of Labor Statistics  Details here: https://www.bls.gov/news.release/cpi.nr0.htm

NFIB Small Business Optimism Index (December 2019)

- level  102.7. Previous was 104.7.

This is a survey index which measures 10 answers from small business owners.  This is important because it is generally small business which generate jobs.

Source: National Federation of Independent Business

Redbook Chain Store Sales (week ended 1/11/2019)

- Same Store Sales year/year +5.0%. Previous was +6.1%.
- Same Store Sales month/month -0.2%. Previous was -2.6%

Chain store sales data is difficult to interpret because the data only includes stores currently open which were open a year ago.  The effect of closed chain stores is not accounted for. 

The data includes about 9,000 stores.

Source: Redbook Research Inc.