Friday March 27 2015
US Consumer Sentiment Above Forecasts in March
University of Michigan | anna@tradingeconomics.com

The University of Michigan's final reading on the overall index of consumer sentiment came in at 93 in March, higher than a preliminary reading of 91.2 but below 95.4 reported in February.

The barometer of current economic conditions decreased to 105 from 106.9 reported in February.

The gauge of consumer expectations fell to 85.3 from 88 in the previous month.

Americans expect the inflation rate in the next year will be 2.8 percent, compared with 2.7 percent in February. Over the next 5 to 10 years, they expect consumer prices to rise 3 percent, compared with 2.8 percent in February.




Friday March 27 2015
US Economy Expands 2.2% in Q4
Anna Fedec | anna@tradingeconomics.com

The United States economy advanced an annualized 2.2 percent in the fourth quarter of 2014, unrevised from last month's estimate. While increases in exports and in personal consumption expenditures were larger than previously estimated, the change in private inventories was smaller.

The increase in real GDP in the fourth quarter reflected positive contributions from PCE, nonresidential fixed investment, exports, state and local government spending, and residential fixed investment that were partly offset by negative contributions from federal government spending and private inventory investment. Imports, which are a subtraction in the calculation of GDP, increased.

The deceleration in real GDP growth in the fourth quarter primarily reflected an upturn in imports, a downturn in federal government spending, a deceleration in nonresidential fixed investment, and a larger decrease in private inventory investment that were partly offset by accelerations in PCE and in state and local government spending.

The price index for gross domestic purchases, which measures prices paid by U.S. residents, decreased 0.1 percent in the fourth quarter, the same decrease as in the second estimate; this index increased 1.4 percent in the third quarter. Excluding food and energy prices, the price index for gross domestic purchases increased 0.7 percent, compared with an increase of 1.6 percent.

Real personal consumption expenditures increased 4.4 percent in the fourth quarter, compared with an increase of 3.2 percent in the third. Durable goods increased 6.2 percent, compared with an increase of 9.2 percent. Nondurable goods increased 4.1 percent, compared with an increase of 2.5 percent. Services increased 4.3 percent, compared with an increase of 2.5 percent.

Real nonresidential fixed investment increased 4.7 percent in the fourth quarter, compared with an increase of 8.9 percent in the third.  Investment in nonresidential structures increased 5.9 percent, compared with an increase of 4.8 percent.  Investment in equipment increased 0.6 percent, compared with an increase of 11.0 percent.  Investment in intellectual property products increased 10.3 percent, compared with an increase of 8.8 percent.  Real residential fixed investment increased 3.8 percent, compared with an increase of 3.2 percent.
Real exports of goods and services increased 4.5 percent in the fourth quarter, the same increase as in the third quarter. Real imports of goods and services increased 10.4 percent, in contrast to a decrease of 0.9 percent.

Real federal government consumption expenditures and gross investment decreased 7.3 percent in the fourth quarter, in contrast to an increase of 9.9 percent in the third.  National defense decreased 12.2 percent, in contrast to an increase of 16.0 percent.  Nondefense increased 1.5 percent, compared with an increase of 0.4 percent.  Real state and local government consumption expenditures and gross investment increased 1.6 percent, compared with an increase of 1.1 percent.

The change in real private inventories subtracted 0.10 percentage point from the fourth-quarter change in real GDP after subtracting 0.03 percentage point from the third-quarter change.  Private businesses increased inventories $80.0 billion in the fourth quarter, following increases of $82.2 billion in the third quarter and $84.8 billion in the second.

Real final sales of domestic product -- GDP less change in private inventories -- increased 2.3 percent in the fourth quarter, compared with an increase of 5.0 percent in the third.




Thursday March 26 2015
Jobless Claims Lowest in 5-Weeks
US Department of Labor | anna@tradingeconomics.com

The number of Americans filing new claims for unemployment benefits decreased by 9,000 to a seasonally adjusted 282,000 in latest week while the number of people continuing to receive jobless benefits dropped by 6,000 to 2.42 million in the week ended March 14th.

The 4-week moving average was 297,000, a decrease of 7,750 from the previous week's unrevised average of 304,750. 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 March 14, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending March 14 was 2,416,000, a decrease of 6,000 from the previous week's revised level. The previous week's level was revised up 5,000 from 2,417,000 to 2,422,000. The 4-week moving average was 2,422,250, an increase of 3,000 from the previous week's revised average. The previous week's average was revised up by 1,250 from 2,418,000 to 2,419,250. 




Wednesday March 25 2015
Durable Goods Orders Disappoint in February
US Census Bureau | anna@tradingeconomics.com

Orders for US capital goods unexpectedly fell 1.4 percent in February, compared to downwardly revised 2 percent growth in January. Excluding transportation, orders dropped 0.4 percent after a 0.7 percent decline in the previous month.

New orders for manufactured durable goods in February decreased $3.2 billion or 1.4 percent to $231.3 billion. This decrease, down three of the last four months, followed a 2.0 percent January increase. Excluding transportation, new orders decreased 0.4 percent. Excluding defense, new orders decreased 1.0 percent, compared to downwardly revised 2 percent growth in January. Transportation equipment, also down three of the last four months, led the decrease, $2.5 billion or 3.5 percent to $69.5 billion.

Shipments of manufactured durable goods in February, down four of the last five months, decreased $0.5 billion or 0.2 percent to $244.0 billion. This followed a 1.4 percent January decrease. Primary metals, down five consecutive months, led the decrease, $0.3 billion or 1.1 percent to $26.1 billion.

Unfilled orders for manufactured durable goods in February, down three consecutive months, decreased $5.6 billion or 0.5 percent to $1,156.9 billion. This followed a 0.3 percent January decrease. Transportation equipment, also down three consecutive months, led the decrease, $4.6 billion or 0.6 percent to $731.6 billion.

Inventories of manufactured durable goods in February, up twenty-two of the last twenty-three months, increased $1.1 billion or 0.3 percent to $413.0 billion.This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.3 percent January increase. Transportation equipment, also up twenty-two of the last twenty-three months, drove the increase, $1.2 billion or 0.9 percent to $135.4 billion.

Nondefense new orders for capital goods in February decreased $2.1 billion or 2.6 percent to $77.3 billion. Shipments decreased slightly to $80.2 billion. Unfilled orders decreased $2.9 billion or 0.4 percent to $727.8
billion. Inventories increased $0.3 billion or 0.1 percent to $186.8 billion.

Defense new orders for capital goods in February increased $0.8 billion or 10.2 percent to $8.3 billion. Shipments decreased $0.1 billion or 0.8 percent to $9.0 billion. Unfilled orders decreased $0.7 billion or 0.4 percent to $152.9 billion. Inventories increased $0.7 billion or 3.0 percent to $24.9 billion.





Tuesday March 24 2015
US New Home Sales At 7-Year High
U.S. Census Bureau | anna@tradingeconomics.com

New U.S. single-family home sales surged 7.8 percent to a seasonally adjusted annual rate of 539,000 units, the highest level since February 2008.

January's figure was revised up to 500,000 units from the previously reported 481,000 units.
   
The gains were reported in spite of cold and snowy weather in the large parts of United States in the last half of February. Sales jumped 152.9 percent in the Northeast, but fell 12.9 percent in the Midwest. Sales in the South rose 10.1 percent but in the West decreased 6.0 percent. 

The median sales price of new houses sold in February 2015 was $275,500; the average sales price was $341,000. The seasonally adjusted estimate of new houses for sale at the end of February was 210,000. This represents a supply of 4.7 months at the current sales rate.





Tuesday March 24 2015
US Factory Activity At 5-Month High
Markit Economics | anna@tradingeconomics.com

The Markit flash U.S. manufacturing PMI rose to 55.3 in March from 55.1 reported in February. It is the highest reading since October, when the final PMI was 55.9.

The output subindex rose to 58.2 in March from 57.3 in February. The new orders gauge also rose in March to its highest since October, coming in at 56.4 compared with 55.8 in February.

 "Manufacturing regained further momentum from the slowdown seen at the turn of the year, with output, new orders and employment growth all accelerating in March," said Chris Williamson, Markit's chief economist.




Tuesday March 24 2015
US Inflation Rate at 0% in February
U.S. Bureau of Labor Statistics | anna@tradingeconomics.com

US consumer prices were unchanged in the year to February 2015, after dropping 0.1 percent in January as decline in energy index was offset by a higher cost of food, shelter and medical care.

The all items index was unchanged over the past 12 months, after showing a 0.1-percent decline for the 12 months ending January. Over the last 12 months the food index rose 3.0 percent and the index for all items less food and energy increased 1.7 percent. Additional upward pressure came from shelter (3 percent), medical care services (1.8 percent) and transportation services (1.8 percent). These increases were offset by an 18.8-percent decline in the energy index. 

On a seasonally adjusted basis, the Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent over the previous month after declining 0.7 percent in January. The seasonally adjusted increase in the all items index was broad-based, with increases in shelter, energy, and food indexes all contributing. The energy index rose after a long series of declines, increasing 1.0 percent as the gasoline index turned up after falling in recent months. The food index, unchanged last month, also rose in February, though major grocery store food group indexes were mixed.

The index for all items less food and energy rose 0.2 percent in February, the same increase as in January. In addition to shelter, the indexes for used cars and trucks, apparel, new vehicles, tobacco, and airline fares were among those that increased. The medical care index was unchanged, while the personal care index declined.
  





Thursday March 19 2015
Jobless Claims Rise Slightly
DOL | Joana Taborda | joana.taborda@tradingeconomics.com

The number of Americans filing new claims for unemployment benefits increased marginally by 1,000 to a seasonally adjusted 291,000 in latest week. In contrast, continuing claims fell to a 3-week low the week before.

The previous week's level was revised up by 1,000 from 289,000 to 290,000. The 4-week moving average was 304,750, an increase of 2,250 from the previous week's revised average. The previous week's average was revised up by 250 from 302,250 to 302,500.

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 March 7, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending March 7 was 2,417,000, a decrease of 11,000 from the previous week's revised level. The previous week's level was revised up 10,000 from 2,418,000 to 2,428,000. The 4-week moving average was 2,418,000, a decrease of 1,250 from the previous week's revised average. The previous week's average was revised up by 2,500 from 2,416,750 to 2,419,250.


Wednesday March 18 2015
Fed Signals Slower Pace of Rises
Federal Reserve | anna@tradingeconomics.com

The Federal Reserve kept the interest rate at 0.25 percent during the meeting held on March 18th but dropped the pledge to be patient on rate rise thus opening the possibility of higher borrowing costs as early as June.

The  full statement from the Federal Reserve

Information received since the Federal Open Market Committee met in January suggests that economic growth has moderated somewhat. Labor market conditions have improved further, with strong job gains and a lower unemployment rate. A range of labor market indicators suggests that underutilization of labor resources continues to diminish. Household spending is rising moderately; declines in energy prices have boosted household purchasing power. Business fixed investment is advancing, while the recovery in the housing sector remains slow and export growth has weakened. Inflation has declined further below the Committee's longer-run objective, largely reflecting declines in energy prices. Market-based measures of inflation compensation remain low; survey-based measures of longer-term inflation expectations have remained stable.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators continuing to move toward levels the Committee judges consistent with its dual mandate. The Committee continues to see the risks to the outlook for economic activity and the labor market as nearly balanced. Inflation is anticipated to remain near its recent low level in the near term, but the Committee expects inflation to rise gradually toward 2 percent over the medium term as the labor market improves further and the transitory effects of energy price declines and other factors dissipate. The Committee continues to monitor inflation developments closely.

To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that the current 0 to 1/4 percent target range for the federal funds rate remains appropriate. In determining how long to maintain this target range, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments. Consistent with its previous statement, the Committee judges that an increase in the target range for the federal funds rate remains unlikely at the April FOMC meeting. The Committee anticipates that it will be appropriate to raise the target range for the federal funds rate when it has seen further improvement in the labor market and is reasonably confident that inflation will move back to its 2 percent objective over the medium term. This change in the forward guidance does not indicate that the Committee has decided on the timing of the initial increase in the target range.

The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. This policy, by keeping the Committee's holdings of longer-term securities at sizable levels, should help maintain accommodative financial conditions.

When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent. The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run.




Tuesday March 17 2015
Housing Starts Tumble in February
U.S. Census Bureau | Joana Taborda | joana.taborda@tradingeconomics.com

US privately-owned housing starts fell 17 percent to a seasonally adjusted annual rate of 897,000 in February. Is it the lowest figure since January last year as cold weather hurt groundbreaking mainly in the Northeast and the Midwest.

The January estimate was revised to 1,081,000 from 1,065,000.

In February, housing starts in the Northeast shrank the most by 56.5 percent, followed by the Midwest (-37 percent), the West (-18.7 percent) and the South (-2.5 percent). 

Single-family housing starts dropped 14.9 percent to 593,000 while. The February rate for units in buildings with five units or more was 297,000 (-21.6 percent).

Privately-owned housing units authorized by building permits in February were at a seasonally adjusted annual rate of 1,092,000. This is 3.0 percent above the revised January rate of 1,060,000. Single-family authorizations in February were at a rate of 620,000; this is 6.2 percent below the revised January figure of 661,000. Authorizations of units in buildings with five units or more were at a rate of 445,000 in February.

Year-on-year, housing starts fell 3.3 percent while building permits rose 7.7 percent.