Thursday October 20 2016
US Initial Jobless Claims at 5-Week High of 260K
DOL | Joana Taborda | email@example.com
The number of Americans filing for unemployment benefits rose to 260,000 in the week ended October 15th, above market expectations of 250,000 and reaching the highest in five weeks. Yet, it marks the 85th consecutive week initial claims are below 300,000, the longest streak since 1970 and signaling the labour market strength.
The previous week's level was revised up by 1,000 to 247,000. The 4-week moving average which smooths out week-to-week volatility in the claims data rose by 2,250 to 251,750. The previous week's average was revised up by 250 from 249,250 to 249,500.
On an unadjusted basis, the biggest increases in initial claims were recorded in Kentucky (up by 5,621); California (up by 3,028); Michigan (up by 2,721); North Carolina (up by 2,520), one of the zones hit by Hurricane Matthew and New York (up by 2,272). In contrast, Pennsylvania (-4,164) and Missouri (-1,988) recorded the biggest declines in initial claims.
The advance seasonally adjusted insured unemployment rate was 1.5 percent for the week ending October 8, unchanged from the previous week's unrevised rate.
The advance number for seasonally adjusted insured unemployment during the week ending October 8 rose by 7,000 to 2,057,000. The previous week's level was revised up 4,000 from 2,046,000 to 2,050,000.
The 4-week moving average was 2,058,250, a decrease of 12,750 from the previous week's revised average. This is the lowest level for this average since July 8, 2000 when it was 2,056,250. The previous week's average was revised up by 1,000 from 2,070,000 to 2,071,000.
Wednesday October 19 2016
US Housing Starts Fall for 2nd Month
U.S. Census Bureau | Joana Taborda | firstname.lastname@example.org
Housing starts in the United States tumbled 9 percent to a seasonally adjusted annualized rate of 1047 thousand in September from August of 2016, below market expectations of 1175 thousand. It is the lowest figure since March of 2015, due to a fall in construction of multifamily homes. In contrast, building permits rose 6.3 percent to 1225 thousand, beating expectations of 1165 thousand.
Starts declined in the South (-5.3 percent to 532 thousand), the Midwest (-14.1 percent to 146 thousand) and the Northeast (-36 percent to 87 thousand) and were flat at 282 thousand in the West.
Housing starts for the volatile multi-family segment shrank 38.9 percent to 250 thousand while single-family homes, the largest segment of the market, rose 8.1 percent to 783 thousand. For the single family segment, biggest gains occured in the Northeast (20 percent to 60 thousand), followed by the South (12.1 percent to 426 thousand) and the Midwest (6.3 percent to 118 thousand) but fell in the West (-2.2 percent to 179 thousand).
Building permits reached the highest since November. Increases occured in the South (2.6 percent to 594 thousand), the West (15.8 percent to 316 thousand) and the Northeast (23.6 percent to 131 thousand) while permits fell 5.2 percent to 184 thousand in the Midwest. Multi-family permits rose 17.2 percent to 449 thousand and the single-family segment edged up 0.4 percent to 739 thousand.
August figures for housing starts were revised upwards to 1150 thousand from 1142 thousand, representing a 5.6 percent fall (-5.8 percent earlier reported). Building permits were also revised up to 1152 thousand from 1139 thousand, a 0.7 percent gain compared to intial estimates of a 0.4 percent fall.
Year-on-year, housing starts declined 11.9 percent in September while building permits increased 8.5 percent.
Tuesday October 18 2016
US Inflation Rate at Nearly 2-Year High in September
BLS | Joana Taborda | email@example.com
Consumer prices in the United States went up 1.5 percent year-on-year in September of 2016, higher than 1.1 percent in August and in line with market expectations. It is the highest inflation rate since October of 2014 boosted by robust gains in shelter and a smaller drop in energy prices while food cost fell for the first time in more than six years.
Year-on-year, prices of services less energy increased 3.2 percent, the same as in August: inflation was steady for shelter (3.4 percent) and eased for transportation services (3 percent from 3.1 percent) and medical care (4.8 percent from 5.1 percent).
Food prices fell 0.3 percent after being flat in August, marking the first decline since February of 2010. In contrast, energy cost fell at a much slower 2.9 percent (-9.2 percent in August)
Annual core inflation which excludes food and energy eased to 2.2 percent from 2.3 percent in the previous month and below market expectations of 2.3 percent.
On a monthly basis, consumer prices rose 0.3 percent after a 0.2 percent gain in August and also in line with market expectations. Increases in the shelter (+0.4 percent) and gasoline (+5.8 percent) indexes registered main upward pressures: gasoline cost accounted for more than half of the all items increase and the shelter index posted the largest gain since May. The energy index increased 2.9 percent, its largest advance since April. In contrast, the index for food was unchanged for the third consecutive month, as the food at home index continued to decline (-0.1 percent).
The core index edged up 0.1 percent, slowing from a 0.3 percent rise in August. Along with shelter, prices for medical care, motor vehicle insurance, personal care, education, alcoholic beverages, airline fares, and tobacco all increased in September. In contrast, the indexes for communication, apparel, used cars and trucks, recreation, and new vehicles declined.
Monday October 17 2016
US Industrial Production Edges Up 0.1% in September
Federal Reserve | Joana Taborda | firstname.lastname@example.org
Industrial output in the United States increased 0.1 percent month-over-month in September of 2016, following an upwardly revised 0.5 percent fall in August and below market expectations of a 0.2 percent gain. Manufacturing and mining rebounded while utilities fell. For the third quarter as a whole, industrial production rose at an annual rate of 1.8 percent for its first quarterly increase since the third quarter of 2015.
Manufacturing output rose 0.2 percent in September and was unchanged from its year-earlier level. Production of durables remained unchanged, the production of nondurables increased 0.5 percent, and the production of other manufacturing (publishing and logging) fell 0.8 percent. Within durables, declines registered by primary metals, by machinery, and by aerospace and miscellaneous transportation equipment were offset by gains elsewhere. All of the major categories within nondurables posted increases; the largest gains, of about 1 1/2 percent, were recorded by printing and support and by petroleum and coal products.
The index for mining moved up 0.4 percent in September. Gains for oil and gas well drilling and servicing, for coal mining, and for nonmetallic mineral mining and quarrying outweighed a drop in crude oil extraction. The output of mining increased at an annual rate of 3.7 percent in the third quarter following six consecutive quarterly decreases.
The index for utilities declined 1.0 percent.
At 104.2 percent of its 2012 average, total industrial production in September was 1.0 percent lower than its year-earlier level. Capacity utilization for the industrial sector edged up 0.1 percentage point in September to 75.4 percent, a rate that is 4.6 percentage points below its long-run (1972–2015) average.
Friday October 14 2016
US Budget Deficit Widens to 3.2% of the GDP in FY 2016
US Treasury | Joana Taborda | email@example.com
The US government posted a USD 33 billion budget surplus in September of 2016, a 63.7 percent fall from a USD 91 billion surplus in the same month a year earlier but above market expectations of a USD 25 billion surplus. For the 2016 fiscal year, the country's budget deficit widened to USD 587 billion or 3.2 percent of the GDP, the highest in three years.
In September of 2016, receipts totaled USD 357 billion, up 2 percent year-on-year as individual income taxes accounted for USD 160 billion, social security and other payroll taxes for USD 93 billion, corporate income taxes for USD 66 billion and other taxes and duties for the remaining USD 37 billion. Outlays totaled USD 323 billion, 18 percent higher than a year earlier as social security accounted for USD 77 billion, Medicare for USD 69 billion, defense for USD 60 billion and other outlays accounted for the remaining USD 134 billion.
Considering the 2016 fiscal year, revenues increased 1 percent to USD 3267 billion while outlays rose at a faster 5 percent to USD 3854 billion. Revenue growth was reduced by the retroactive extension of some expired individual and corporate tax deductions. In FY 2015, the country recorded a USD 439 billion gap, equivalent to 2.5 percent of the GDP.
Friday October 14 2016
US Consumer Sentiment at 13-Month Low
University of Michigan | Joana Taborda | firstname.lastname@example.org
The preliminary reading of the University of Michigan's consumer sentiment for the United States fell to 87.9 in October of 2016 from 91.2 in September. It is the lowest figure since September last year and well below market expectations of 91.9, hurt by a fall in future expectations.
The barometer of future expectations declined to 76.6 from 82.7 in September and below market forecasts of 82.7. In contrast, the gauge of current economic conditions rose to 105.5 from 104.2 in September and better than estimates of 104.7.
Americans expect the inflation rate in the next year to be 2.4 percent, the same as in September and to be lower at 2.4 percent over the next 5 years (2.6 percent in September).
Friday October 14 2016
US Retail Sales Rebound in September
US Census Bureau | Joana Taborda | email@example.com
Retail sales in the United States increased 0.6 percent on the month in September of 2016, following a downwardly revised 0.2 percent drop in August and in line with market estimates. It is the best performance in three months, mainly boosted by auto sales and spending in grocery stores and gasoline stations.
Sales in gasoline stations recorded the biggest increase (2.4 percent), followed by miscellaneous store retailers (1.8 percent); sporting goods, hobby, book and music stores (1.4 percent); building material and garden equipment and supplies dealers (1.4 percent); motor vehicle and parts dealers (1.1 percent); furniture and home furniture stores (1 percent); food services and drinking places (0.8 percent); nonstore retailers (0.3 percent) and food and beverage stores (0.1 percent).
In contrast, sales were flat in clothing and clothing accessories stores and fell in electronics and appliance stores (-0.9 percent); health and personal care stores (-0.5 percent) and general merchandise stores (-0.4 percent).
Year-on-year, retail sales increased 2.7 percent, following an upwardly revised 2.1 percent gain in August.
Thursday October 13 2016
US Jobless Claims at 43-Year Low
DOL | Joana Taborda | firstname.lastname@example.org
The number of Americans filing for unemployment benefits was flat at 246,000 in the week ended October 8th, the lowest in 43 years and below market expectations of 254,000. It marks the 84th consecutive week initial claims are below 300,000, the longest streak since 1970 and signaling the labour market strength.
The previous week's level was revised down by 3,000 from 249,000 to 246,000.
The 4-week moving average was 249,250, a decrease of 3,500 from the previous week's revised average. This is the lowest level for this average since November 3, 1973 when it was 244,000. The previous week's average was revised down by 750 from 253,500 to 252,750.
The advance seasonally adjusted insured unemployment rate was 1.5 percent for the week ending October 1, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending October 1 was 2,046,000, a decrease of 16,000 from the previous week's revised level. This is the lowest level for insured unemployment since June 24, 2000 when it was 2,033,000. The previous week's level was revised up 4,000 from 2,058,000 to 2,062,000.
The 4-week moving average was 2,070,000, a decrease of 25,750 from the previous week's revised average. This is the lowest level for this average since July 8, 2000 when it was 2,056,250. The previous week's average was revised up by 1,000 from 2,094,750 to 2,095,750.
Wednesday October 12 2016
Fed Continues to Leave 2016 Rate Hike Option Open
Federal Reserve | Joana Taborda | email@example.com
Fed's decision to leave the target for the federal funds rate on hold in September was a close call and policymakers generally agreed that the case for a rate hike had strengthened in recent months, minutes from FOMC meeting held on September 20-21st showed.
Extracts From the Minutes of the Federal Open Market Committee:
Participants generally expected that, with gradual adjustments in the stance of monetary policy, economic activity would expand at a moderate pace and labor market conditions would strengthen somewhat further. Inflation was expected to remain low in the near term, in part because of earlier declines in energy prices, but to rise to 2 percent over the medium term as the transitory effects of past declines in energy and import prices dissipated and the labor market strengthened further. A number of participants indicated that there had been little change in their economic outlooks over recent months. A substantial majority now viewed the near-term risks to the economic outlook as roughly balanced, with several of them indicating the risks from Brexit had receded. However, a few still judged that overall risks were weighted to the downside, citing various factors that included the possibility of weaker-than-expected growth in foreign economies, continued uncertainty associated with Brexit, the proximity of policy interest rates to the effective lower bound, or persistent headwinds to economic growth. Participants agreed that the Committee should continue to closely monitor inflation indicators and global economic and financial developments.
Against the backdrop of their economic projections, participants discussed whether available information warranted taking another step to reduce policy accommodation at this meeting. Participants generally agreed that the case for increasing the target range for the federal funds rate had strengthened in recent months. Many of them, however, expressed the view that recent evidence suggested that some slack remained in the labor market. With inflation continuing to run below the Committee's 2 percent objective and few signs of increased pressure on wages and prices, most of these participants thought it would be appropriate to await further evidence of continued progress toward the Committee's statutory objectives. In contrast, some other participants believed that the economy was at or near full employment and inflation was moving toward 2 percent. They maintained that a further delay in raising the target range would unduly increase the risk of the unemployment rate falling markedly below its longer-run normal level, necessitating a more rapid removal of monetary policy accommodation that could shorten the economic expansion. In addition, several participants expressed concern that continuing to delay an increase in the target range implied a further divergence from policy benchmarks based on the Committee's past behavior or risked eroding its credibility, especially given that recent economic data had largely corroborated the Committee's economic outlook.
Among the participants who supported awaiting further evidence of continued progress toward the Committee's objectives, several stated that the decision at this meeting was a close call. Some participants believed that it would be appropriate to raise the target range for the federal funds rate relatively soon if the labor market continued to improve and economic activity strengthened, while some others preferred to wait for more convincing evidence that inflation was moving toward the Committee's 2 percent objective. Some participants noted the importance of clearly communicating to the public the conditions that would warrant an increase in the policy rate.
Friday October 07 2016
US Jobless Rate at 5-Month High of 5% in September
BLS | Yekaterina Guchshina | firstname.lastname@example.org
US unemployment rate increased to 5 percent in September 2016, compared to 4.9 percent in the previous month and missing market expectations of 4.9 percent. It was the highest jobless rate since April, as the number of unemployed persons rose by 90 thousand to 7.9 million while the labor force participation rate edged up by 0.1 percentage point to 62.9 percent.
Among the major worker groups, the unemployment rate for Hispanics increased to 6.4 percent in September, while the rates for adult men (4.7 percent), adult women (4.4 percent), teenagers (15.8 percent), Whites (4.4 percent), Blacks (8.3 percent), and Asians (3.9 percent) showed little or no change.
The number of persons unemployed less than 5 weeks increased by 284,000 to 2.6 million in September. The number of long-term unemployed (those jobless for 27 weeks or more) was essentially unchanged at 2.0 million and accounted for 24.9 percent of the unemployed.
In September, both the labor force participation rate, and employment-population ratio increased by 0.1 percentage points to 62.9 percent and to 59.8 percent, respectively. The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was little changed in September at 5.9 million. 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 September, 1.8 million persons were marginally attached to the labor force, about unchanged 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 553,000 discouraged workers in September, little changed 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 1.3 million persons marginally attached to the labor force in September had not searched for work for reasons such as school attendance or family responsibilities.