Wednesday November 26 2014
New Home Sales Below Expectations
U.S. Census Bureau | Joana Taborda | joana.taborda@tradingeconomics.com

Sales of new single-family houses in October were at a seasonally adjusted annual rate of 458,000, up from a downwardly revised 455,000 in the previous month, but missing market forecasts. The stock of new houses for sale rose 1.0 percent, the highest level since June of 2010.

In October of 2014, new home sales rose 0.7 percent over September and 1.8 percent year-on-year.

The median sales price of new houses sold in October 2014 was $305,000; the average sales price was $401,100. The seasonally adjusted estimate of new houses for sale at the end of October was 212,000. This represents a supply of 5.6 months at the current sales rate.

Sales in the Midwest jumped 15.8 percent and those in the Northeast rose 7.1 percent. In contrast, sales in the West fell 2.7 percent and those in the South shrank 1.9 percent. 




Wednesday November 26 2014
US Consumer Sentiment Highest Since July of 2007
The Thomson Reuters/University of Michigan | Joana Taborda | joana.taborda@tradingeconomics.com

The Thomson Reuters/University of Michigan's final reading on the overall index of consumer sentiment came in at 88.8 in November, down from a preliminary reading of 89.4 but up from 86.9 in October.

The barometer of current economic conditions decreased marginally to a final 102.7 from a preliminary 103. In October, the current conditions index marked 98.3. 

The final gauge of consumer expectations decreased to 79.9 from a preliminary 80.6 but rose from 79.6 in October. 

The one-year inflation expectations increased to 2.8 percent in November from a preliminary 2.6 percent but fell from 2.9 percent in the previous month. The five-to-ten-year inflation outlook was recorded at 2.6 percent, unchanged from the preliminary reading but down from 2.8 percent in October. 




Wednesday November 26 2014
Durable Goods Orders Up 0.4%
US Census Bureau | Joana Taborda | joana.taborda@tradingeconomics.com

New orders for manufactured durable goods increased 0.4 percent in October, following a revised 0.9 percent drop in September. It is the first gain in three months driven by a 3.4 percent rise in transportation orders.

Excluding transportation, new orders shrank 0.9 percent, following a revised 0.2 percent rise in the previous month. Excluding defense, new orders decreased 0.6 percent.

Transportation equipment, also up following two consecutive monthly decreases, drove the increase, $2.5 billion or 3.4 percent to $76.3 billion.

Shipments of manufactured durable goods in October, up four of the last five months, increased $0.3 billion or 0.1 percent to $246.5 billion. This followed a 0.3 percent September increase.

Unfilled orders for manufactured durable goods in October, up eighteen of the last nineteen months, increased $5.0 billion or 0.4 percent to $1,174.0 billion. This was at the highest level since the series was first published on a NAICS basis in 1992 and followed a 0.4 percent September increase.

Inventories of manufactured durable goods in October, up eighteen of the last nineteen months, increased $2.0 billion or 0.5 percent to $406.8 billion. This was at the highest level since the series was first published on a NAICS basis and followed a 0.5 percent September increase.

Nondefense new orders for capital goods in October decreased $0.1 billion or 0.1 percent to $82.2 billion. Shipments decreased $0.6 billion or 0.8 percent to $80.1 billion. Unfilled orders increased $2.1 billion or 0.3 percent to $735.1 billion. Inventories increased $0.9 billion or 0.5 percent to $185.9 billion.

Defense new orders for capital goods in October increased $1.1 billion or 11.2 percent to $10.5 billion. Shipments increased $0.1 billion or 1.4 percent to $9.8 billion. Unfilled orders increased $0.7 billion or 0.4 percent to $158.6 billion. Inventories increased $0.2 billion or 1.0 percent to $23.9 billion. 





Wednesday November 26 2014
Personal Spending Rises 0.2% in October
Anna Fedec | anna@tradingeconomics.com

Consumer spending in the US increased by 0.2 percent in October, the same pace as incomes.

Personal income increased $32.9 billion, or 0.2 percent, and disposable personal income (DPI) increased $23.4 billion, or 0.2 percent. Personal consumption expenditures (PCE) increased $27.3 billion, or 0.2 percent. In September, personal income increased $24.6 billion, or 0.2 percent, DPI increased $17.2 billion, or 0.1 percent, and PCE increased $4.1 billion, or less than 0.1 percent.

Private wages and salaries increased $18.8 billion in October, compared with an increase of $13.9 billion in September. Goods-producing industries' payrolls increased $7.2 billion, compared with an increase of $2.4 billion; manufacturing payrolls increased $4.4 billion, compared with an increase of $0.7 billion. Services-producing industries' payrolls increased $11.6 billion, compared with an increase of $11.3 billion. Government wages and salaries increased $1.4 billion, compared with an increase of $1.8 billion. '




Wednesday November 26 2014
Jobless Claims At Almost Three-Month High
Anna Fedec | anna@tradingeconomics.com

In the week ending November 22nd, 313 Thousand American filed for unemployment benefits an increase of 21,000 from the previous week's revised level.

The previous week's level was revised up by 1,000 from 291,000 to 292,000. The 4-week moving average was 294,000, an increase of 6,250 from the previous week's revised average. The previous week's average was revised up by 250 from 287,500 to 287,750.

The advance seasonally adjusted insured unemployment rate was 1.7 percent for the week ending November 15, a decrease of 0.1 percentage point from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending November 15 was 2,316,000, a decrease of 17,000 from the previous week's revised level. This is the lowest level for insured unemployment since December 9, 2000 when it was 2,263,000. The previous week's level was revised up 3,000 from 2,330,000 to 2,333,000. The 4-week moving average was 2,352,000, a decrease of 17,750 from the previous week's revised average. This is the lowest level for this average since January 6, 2001 when it was 2,349,250. 






Tuesday November 25 2014
US GDP Growth Revised Up to 3.9% in Q3
U.S. Commerce Department | Joana Taborda | joana.taborda@tradingeconomics.com

The United States economy advanced an annualized 3.9 percent in the third quarter of 2014, according to the second estimate released by the Bureau of Economic Analysis. The new figure comes better than an advance estimate of 3.5 percent, as consumer spending and investment contributed more to the growth.

Real personal consumption expenditures increased 2.2 percent in the third quarter, compared with an increase of 2.5 percent in the second. Durable goods increased 8.7 percent, compared with an increase of 14.1 percent. Nondurable goods increased 2.2 percent, the same increase as in the second quarter.  Services increased 1.2 percent, compared with an increase of 0.9 percent.

Real nonresidential fixed investment increased 7.1 percent in the third quarter, compared with an increase of 9.7 percent in the second.  Investment in nonresidential structures increased 1.1 percent, compared with an increase of 12.6 percent. Investment in equipment increased 10.7 percent, compared with an increase of 11.2 percent. Investment in intellectual property products increased 6.4 percent, compared with an increase of 5.5 percent. Real residential fixed investment increased 2.7 percent, compared with an increase of 8.8 percent.

Real exports of goods and services increased 4.9 percent in the third quarter, compared with an increase of 11.1 percent in the second. Real imports of goods and services decreased 0.7 percent, in contrast to an increase of 11.3 percent.

Real federal government consumption expenditures and gross investment increased 9.9 percent in the third quarter, in contrast to a decrease of 0.9 percent in the second. National defense increased 16.0 percent, compared with an increase of 0.9 percent. Nondefense increased 0.4 percent, in contrast to a decrease of 3.8 percent. Real state and local government consumption expenditures and gross investment increased 0.8 percent, compared with an increase of 3.4 percent.

The change in real private inventories subtracted 0.12 percentage point from the third-quarter change in real GDP after adding 1.42 percentage points to the second-quarter change. Private businesses increased inventories $79.1 billion in the third quarter, following increases of $84.8 billion in the second quarter and $35.2 billion in the first.

Real final sales of domestic product -- GDP less change in private inventories -- increased 4.1 percent in the third quarter, compared with an increase of 3.2 percent in the second.




Thursday November 20 2014
US Markit Manufacturing PMI Down to 10-Month Low
Markit | Joana Taborda | joana.taborda@tradingeconomics.com

US factory activity slowed for the third consecutive month to 54.7 in November from 55.9 in October. Output and new orders subindexes were at their lowest levels since January, while the employment gauge rose slightly.

Weaker rates of output and new business growth were the main negative influences on the headline PMI figure in November. Latest data pointed to the slowest expansion of manufacturing production for ten months, with a number of survey respondents citing less favourable demand conditions. 

Incoming new work also increased at the weakest pace since January, partly reflecting a reversal in export sales volumes. Although only modest, the rate of decline in new orders from abroad was the most marked for 17 months. Some survey respondents commented on the strengthening dollar exchange rate, as well as more subdued underlying export market business conditions.

Resilient job market trends continued across the U.S. manufacturing sector in November. Latest data highlighted a robust rise in payroll numbers, and the rate of expansion was slightly stronger than seen in the previous month. However, there were signs of moderating capacity pressures, as manufacturers indicated that backlogs of work increased at the slowest pace for ten months.

In line with softer new business gains, the latest survey indicated the weakest upturn in input buying since March. Pre-production inventories increased for the fifth month running, but at a slower pace than in October, while stocks of finished goods rose only marginally. Despite slower growth of purchasing activity, average lead times from suppliers continued to lengthen in November, which extended the current period of deterioration to 17 months.




Thursday November 20 2014
US Inflation Rate Stable at 1.7%
BLS | Joana Taborda | joana.taborda@tradingeconomics.com

US annual inflation rate was recorded at 1.7 percent for the third consecutive month in October, as fall in energy prices was enough to offset higher food and shelter cost. Prices remained unchanged compared with the previous month.

Year-on-year energy prices declined 1.6 percent as cost of gasoline and fuel oil dropped by 5 percent and 6.5 percent respectively. Food cost increased by 3.1 percent. The index for all items less food and energy went up by 1.8 percent following a 1.7 percent rise in the previous month. Cost of services less energy increased by 2.5 percent with shelter and transportation index going up by 3 percent and 1.8 percent respectively.

On a monthly basis, consumer prices were unchanged in October, following a 0.1 percent increase in the previous month.Energy prices fell 1.9 percent, its fourth consecutive decline,  as cost of gasoline and fuel oil dropped by 3 percent and 4 percent respectively. In contrast, food cost went up by 0.1 percent, its smallest increase since June. The index for all items less food and energy rose by 0.2 percent. Cost of services less energy increased by 0.3 percent with shelter and transportation cost going up by 0.2 percent and 0.8 percent respectively.





Thursday November 20 2014
Jobless Claims Below 300K for 10th Week
US Labor Department | anna@tradingeconomics.com

In the week ending November 15th, 291 Thousand American filed for unemployment benefits a decrease of 2,000 from the previous week's revised level.

The previous week's level was revised up by 3,000 from 290,000 to 293,000. The 4-week moving average was 287,500, an increase of 1,750 from the previous week's revised average. The previous week's average was revised up by 750 from 285,000 to 285,750.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 November 8, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending November 8 was 2,330,000, a decrease of 73,000 from the previous week's revised level. This is the lowest level for insured unemployment since December 16, 2000 when it was 2,322,000. The previous week's level was revised up 11,000 from 2,392,000 to 2,403,000. The 4-week moving average was 2,369,000, a decrease of 6,250 from the previous week's revised average. This is the lowest level for this average since January 13, 2001 when it was 2,360,500. The previous week's average was revised up by 2,750 from 2,372,500 to 2,375,250. 


Wednesday November 19 2014
Fed Raises Concerns Over Low Inflation
Federal Reserve | Joana Taborda | joana.taborda@tradingeconomics.com

Minutes from Fed’s last meeting showed policymakers were concerned about a possible downward shift in longer-term inflation expectations in the wake of lower growth. Also, it was an easy decision for the committee to end quantitative easing, although one member did not support it.

Extracts from the minutes of Federal Open Market Committee meeting held in October:


In their discussion of the economic situation and the outlook, most meeting participants viewed the information received over the intermeeting period as suggesting that economic activity continued to expand at a moderate pace. Labor market conditions improved somewhat further, with solid job gains and a lower unemployment rate; on balance, participants judged that the underutilization of labor resources was gradually diminishing. Participants generally expected that, over the medium term, real economic activity would increase at a pace sufficient to lead to a further gradual decline in the unemployment rate toward levels consistent with the Committee's objective of maximum employment. Inflation was continuing to run below the Committee's longer-run objective. Market-based measures of inflation compensation declined somewhat, while survey-based measures of longer-term inflation expectations remained stable. Participants anticipated that inflation would be held down over the near term by the decline in energy prices and other factors, but would move toward the Committee's 2 percent goal in coming years, although a few expressed concern that inflation might persist below the Committee's objective for quite some time. Most viewed the risks to the outlook for economic activity and the labor market as nearly balanced. However, a number of participants noted that economic growth over the medium term might be slower than they currently expected if the foreign economic or financial situation deteriorated significantly.

Most participants anticipated that inflation was likely to edge lower in the near term, reflecting the decline in oil and other commodity prices and lower import prices. These participants continued to expect inflation to move back to the Committee's 2 percent target over the medium term as resource slack diminished in an environment of well-anchored inflation expectations, although a few of them thought the return to 2 percent might be quite gradual. 

In their discussion of the asset purchase program, members generally agreed that the condition articulated by the Committee when it began the program in September 2012 had been achieved--that is, there had been a substantial improvement in the outlook for the labor market--and that there was sufficient underlying strength in the broader economy to support ongoing progress toward maximum employment in a context of price stability. Accordingly, all members but one supported concluding the Committee's asset purchase program at the end of October and maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency MBS in agency MBS and of rolling over maturing Treasury securities at auction. 

In addition, the Committee agreed to maintain the target range for the federal funds rate at 0 to 1/4 percent and to reaffirm the indication in the statement that the Committee's decision about how long to maintain the current target range for the federal funds rate would depend on its assessment of actual and expected progress toward its objectives of maximum employment and 2 percent inflation. All but one member agreed that the Committee should reiterate the expectation that it likely would be appropriate to maintain the current target range for the federal funds rate for a considerable time following the end of the asset purchase program in October, especially if projected inflation continued to run below the Committee's 2 percent longer-run goal, and provided that longer-term inflation expectations remained well anchored.