Tuesday January 27 2015
New Home Sales at 6-1/2-Year High
U.S. Census Bureau | Joana Taborda | joana.taborda@tradingeconomics.com

Sales of new single-family houses were recorded at a seasonally adjusted annual rate of 481,000 in December, up 11.6 percent from a revised 431,000 in November. It is the highest figure since June of 2008 as sales in Northeast region surged 53.6 percent.

The median sales price of new houses sold in December 2014 was $298,100; the average sales price was $377,800. The seasonally adjusted estimate of new houses for sale at the end of December was 219,000. This represents a supply of 5.5 months at the current sales rate.

Sales in the Northeast jumped 53.6 percent and those in the South increased 17.7 percent. Sales in the West grew 3.1 percent while those in the Midwest shrank 11.5 percent. 

Year-on-year, new home sales rose 8.8 percent in December. 

An estimated 435,000 new homes were sold in 2014. This is 1.2 percent above the 2013 figure of 429,000. 




Tuesday January 27 2015
Durable Goods Orders Disappoint in December
US Census Bureau | Joana Taborda | joana.taborda@tradingeconomics.com

Orders for US capital goods shrank by 3.4 percent in December, following a downwardly revised 2.1 percent fall in November. Excluding transportation, orders were down 0.8 percent after a 1.3 percent decline in the previous month.

New orders for manufactured durable goods in December decreased $8.1 billion to $230.5 billion, down four of the last five months. Excluding defense, new orders decreased 3.2 percent. Non-defense capital goods orders excluding aircraft, fell 0.6 percent after downwardly revised 0.6 percent drop in November. Orders for transportation equipment were down 9.2 percent.

Shipments of manufactured durable goods in December, up following two consecutive monthly decreases, increased $2.6 billion or 1.1 percent to $246.8 billion. This followed a 0.7 percent November decrease. Transportation equipment, up three of the last four months, led the increase, $2.2 billion or 3.1 percent to $74.5 billion.

Unfilled orders for manufactured durable goods in December, down following ten consecutive monthly increases, decreased $8.9 billion or 0.8 percent to $1,167.6 billion. This followed a 0.2 percent November increase. 

Inventories of manufactured durable goods in December, up twenty of the last twenty-one months, increased $2.0 billion or 0.5 percent to $410.8 billion. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.5 percent November increase.

Nondefense new orders for capital goods in December decreased $7.9 billion or 9.7 percent to $73.3 billion. Shipments increased $0.1 billion or 0.2 percent to $78.9 billion. Unfilled orders decreased $5.7 billion or 0.8 percent to $732.4 billion. Inventories increased $1.0 billion or 0.5 percent to $187.5 billion.

Defense new orders for capital goods in December decreased $0.5 billion or 5.3 percent to $8.7 billion. Shipments increased $0.2 billion or 2.2 percent to $10.2 billion. Unfilled orders decreased $1.5 billion or 0.9 percent to $156.2 billion. Inventories decreased $0.1 billion or 0.3 percent to $24.1 billion.




Friday January 23 2015
US Manufacturing Activity At 1-Year Low
Markit Economics | Joana Taborda | joana.taborda@tradingeconomics.com

The Markit flash U.S. manufacturing PMI registered 53.7 in January, down from 53.9 in December. It is the lowest figure since January of 2014 as new business growth slowed and there were fewer new orders.

Slower new business growth was a key factor weighing on the overall performance of the U.S. manufacturing sector in January. Volumes of new work have increased in each month since September 2009, but the latest upturn was the weakest for a year and slightly slower than the average seen during the current period of expansion.

Reports from survey respondents suggested that improving domestic economic conditions continued to boost new order levels, but overall export demand remained lacklustre. Meanwhile, some manufacturers noted that reduced spending among clients operating in the oil and gas sector had weighed on new order volumes during January.

Despite softer new business growth, manufacturing sector production levels increased at a robust pace during the latest survey period. Moreover, the rate of output growth picked up slightly from the 11-month low registered in December.

Payroll numbers increased in the U.S. manufacturing at the start of 2015, thereby extending the current period of continuous expansion to 19 months. The rate of job creation remained solid, and picked up slightly from that recorded in December. Greater levels of staff hiring were linked to expectations of rising workloads and improved profitability in the months ahead. Nonetheless, firms remained cautious in terms of input buying in January, with purchasing activity rising at the least marked pace for 12 months and pre-production inventories increased only fractionally.

U.S. manufacturers registered a slight reduction in their overall cost burdens in January, which ended a 29-month period of sustained input price inflation. Although only marginal, the decrease in input costs was one of the fastest seen since mid-2009, which survey respondents mainly linked to falling oil prices. 

Meanwhile, manufacturers indicated only a marginal increase in their average prices charged, largely reflecting subdued cost pressures in recent months. 




Thursday January 22 2015
Jobless Claims Down to 307K in the Latest Week
U.S. Department of Labor | anna@tradingeconomics.com

The number of Americans filing new claims for unemployment benefits decreased by 10,000 to a seasonally adjusted 307,000 in the week ending January 17th. The previous week’s level was revised to 317,000.

The 4-week moving average was 306,500, an increase of 6,500 from the previous week's revised average. The previous week's average was revised up by 2,000 from 298,000 to 300,000. There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.8 percent for the week ending January 10, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending January 10 was 2,443,000, an increase of 15,000 from the previous week's revised level. The previous week's level was revised up 4,000 from 2,424,000 to 2,428,000. The 4-week moving average was 2,427,000, an increase of 9,000 from the previous week's revised average. The previous week's average was revised up by 3,500 from 2,414,500 to 2,418,000. 




Wednesday January 21 2015
Housing Starts Rise More Than Expected
U.S. Census Bureau | Joana Taborda | joana.taborda@tradingeconomics.com

US privately-owned housing starts rose 4.4 percent to a seasonally adjusted annual rate of 1,089,000 in December. It is the strongest figure since July as single-family homes starts hit the highest level in more than six years.

The November estimate was revised to 1,043,000. Year-on-year, housing starts increased 5.3 percent 

Single-family housing starts in December were at a rate of 728,000; this is 7.2 percent above the revised November figure of 679,000. The December rate for units in buildings with five units or more was 339,000. An estimated 1,005,800 housing units were started in 2014. This is 8.8 percent (±2.9%) above the 2013 figure of 924,900.

Privately-owned housing units authorized by building permits in December were at a seasonally adjusted annual rate of 1,032,000. This is 1.9 percent below the revised November rate of 1,052,000, but is 1.0 percent above the December 2013 estimate of Single-family authorizations in December were at a rate of 667,000; this is 4.5 percent above the revised November figure of 638,000. Authorizations of units in buildings with five units or more were at a rate of 338,000 in December.

An estimated 1,032,900 housing units were authorized by building permits in 2014. This is 4.2 percent above the 2013 figure of 990,800.

Privately-owned housing completions in December were at a seasonally adjusted annual rate of 927,000. This is 6.3 percent above the revised November estimate of 872,000 and is 19.6 percent above the December 2013 rate of 775,000.




Friday January 16 2015
US Consumer Sentiment At 11-Year High
University of Michigan | anna@tradingeconomics.com

The Thomson Reuters/University of Michigan's preliminary reading on the overall index of consumer sentiment came in at 98.2 in January. It is the highest figure since January of 2004 as lower gasoline prices and steady job gains improved consumer's current and future expectations.

The barometer of current economic conditions increased to 108.3 in January from a final reading of 104.8 in December of 2014 and from 96.8 in January of 2014. 

The gauge of consumer expectations came in at 91.6 compared to 86.4 a month ago and 71.2 a year ago. 

The one-year inflation expectations decreased to 2.4 percent from 2.8 percent in December. The five-to-ten-year inflation outlook was recorded at 2.8 percent, unchanged compared to the previous month.

Statement by University of Michigan's chief economist, Richard Curtin

Consumer confidence rose in early January to its highest level in a decade. Gains in employment and incomes as well as declines in gas prices were cited by record numbers of consumers. More consumers spontaneously cited increases in their household incomes in early January than anytime in the past decade, and more households reported unprompted references to favorable employment prospects as well as lower prices than at any other time in the more than the half-century history of the surveys. While it may be true that consumers have allowed the confluence of more jobs, higher wages, and lower gas prices to fuel a run-up in optimism that may be hard to sustain in the months ahead, even a small retrenchment would have little impact on an expected gain of 3.0% in real consumer expenditures in 2015. 





Friday January 16 2015
US Industrial Production Down 0.1%
Federal Reserve | Joana Taborda | joana.taborda@tradingeconomics.com

Industrial output decreased 0.1 percent in December after rising 1.3 percent in the previous month, due to a sharp drop in the output of utilities, as warmer-than-usual temperatures reduced demand for heating. Excluding utilities, industrial production rose 0.7 percent.

Utilities output shrank 7.3 percent in December, following a revised 4.2 percent increase in the previous month.

Manufacturing rose 0.3 percent in December and at an annual rate of 5.2 percent in the fourth quarter. Manufacturing output in December was 4.9 percent above its level of a year earlier. The production of durable goods increased 0.2 percent in December, and the production of nondurable goods rose 0.4 percent. Among major durable goods industries, primary metals posted the largest increase, 2.2 percent, while computers and electronic products registered a gain of 1.2 percent. The largest declines, of nearly 1 percent or more, were recorded by wood products and by motor vehicles and parts. Production increased for most nondurable goods industries, with the largest advance recorded by apparel and leather; only the plastics and rubber products industry registered a decrease. The production index for other manufacturing industries (publishing and logging) declined 0.3 percent.

The output of mining jumped 2.2 percent in December. Much of the strength reflected increases in oil and gas extraction, but a drop in drilling and well-servicing activity at oil and gas fields tempered the gains.

At 106.5 percent of its 2007 average, total industrial production in December was 4.9 percent above its level of a year earlier. For the fourth quarter of 2014 as a whole, industrial production advanced at an annual rate of 5.6 percent, with widespread gains among the major market and industry groups. 

Capacity utilization for the industrial sector decreased 0.3 percentage point in December to 79.7 percent, a rate that is 0.4 percentage point below its long-run (1972–2013) average.




Friday January 16 2015
US Inflation Rate At 5-Year Low
BLS | Joana Taborda | joana.taborda@tradingeconomics.com

US annual inflation rate slowed to 0.8 percent in December from 1.3 percent in the previous month. It is the lowest figure since October of 2009 as cost of energy plunged. On a monthly basis, consumer prices dropped 0.4 percent, the biggest decline in six years.

Over the last twelve months, the cost of energy has declined 10.6 percent. The core inflation rate (less food and energy) edged down to 1.6 percent from 1.7 percent in the previous month. In contrast, the food inflation continued its upward trend rising 3.4 percent, its largest 12-month increase since February 2012.

On a monthly basis, the consumer price index declined 0.4 percent, following a 0.3 percent drop in November. The gasoline index continued to fall sharply, declining 9.4 percent and leading to the decrease in the seasonally adjusted all items index. The fuel oil index also fell sharply, and the energy index posted its largest one-month decline since December 2008, although the indexes for natural gas and for electricity both increased. The food index, in contrast, rose 0.3 percent, its largest increase since September.  

The index for all items less food and energy was unchanged in December, following a 0.2 percent increase in October and a 0.1 percent rise in November. This was only the second time since 2010 that it did not increase. The shelter index continued to rise, and the index for medical care posted its largest increase since August 2013. However, these increases were offset by declines in a broad array of indexes including apparel, airline fares, used cars and trucks, household furnishings and operations, and new vehicles. 

The CPI rose 0.8 percent in 2014 after a 1.5 percent increase in 2013. This is the second-smallest December-December increase in the last 50 years, trailing only the 0.1 percent increase in 2008. It is considerably lower than the 2.1 percent average annual increase over the last ten years. 





Thursday January 15 2015
Jobless Claims at 18-Week High
DOL | Joana Taborda | joana.taborda@tradingeconomics.com

The number of Americans filing new claims for unemployment benefits increased by 19,000 to a seasonally adjusted 316,000 in the week ending January 10th. The previous week’s level was revised to 297,000.

The 4-week moving average was 298,000, an increase of 6,750 from the previous week's revised average. The previous week's average was revised up by 750 from 290,500 to 291,250.

There were no special factors impacting this week's initial claims.

The advance seasonally adjusted insured unemployment rate was 1.8 percent for the week ending January 3, a decrease of 0.1 percentage point from the previous week's revised rate. The previous week's rate was revised up by 0.1 from 1.8 to 1.9 percent. The advance number for seasonally adjusted insured unemployment during the week ending January 3 was 2,424,000, a decrease of 51,000 from the previous week's revised level. The previous week's level was revised up 23,000 from 2,452,000 to 2,475,000. The 4-week moving average was 2,414,500, an increase of 11,500 from the previous week's revised average. The previous week's average was revised up by 6,000 from 2,397,000 to 2,403,000.


Wednesday January 14 2015
US Retail Sales Disappoint in December
US Commerce Department | Joana Taborda | joana.taborda@tradingeconomics.com

Retail sales shrank 0.9 percent in December, following a 0.4 percent gain in the previous month that was smaller than previously estimated. It is the biggest drop since January as demand fell for nine of thirteen major categories.


Sales at gasoline stations recorded the highest decrease (-6.5 percent) as price of petrol become cheaper. The receipts also fell at: electronics and appliance stores (-1.6 percent); auto dealers (-0.3 percent); clothing retailers (-0.3 percent); online stores (- 0.3 percent), sporting goods stores (0.2 percent), miscellaneous store retailers (-1.9 percent) and building material and garden dealers (-1.9 percent).

In contrast, receipts rose at: furniture stores (0.8 percent), grocery stores (0.3 percent) and health care stores (0.5 percent). 

Core sales, which strip out automobiles, gasoline, building materials and food services fell 0.4 percent, following a 0.6 percent rise in November. Excluding automobiles, sales dropped 1 percent (+0.1 percent in the previous month). 

Year-on-year retail sales rose 3.2 percent. Total sales for the 12 months of 2014 were up 4.0 percent from 2013.