U.S. Economic News

U.S. Economic News

February 21, 2018

U.S. Economic Indicators

Existing home sales fell 3.2% to a seasonally adjusted annual rate of 5.38 million in January, and are 4.8% below year-ago levels.  NAR notes that January marked the largest year-over-year decline in existing home sales since 2014, as an utter lack of inventory and the resulting high prices forced many prospective buyers out of the market.  NAR Report

U.S. News

According to the Wall Street Journal, the bipartisan spending agreement reached by U.S. lawmakers has caused economists to raise expectations for Federal Reserve rate hikes this year. Market-watchers expect that the expanded government spending, along with recently-passed tax cuts, will provide a fiscal stimulus that will cause inflationary pressures to build more rapidly than before. WSJ

Greg Ip of the Wall Street Journal reports that increasing U.S. oil production has changed the relationship between oil prices and economic momentum in the U.S. Though higher oil prices used to be tied to slower economic growth, the surge in U.S. oil production means that the burden of increasing prices is increasingly offset by expanding energy investment, production, and jobs. WSJ

U.S. Economic News

U.S. Economic News

February 20, 2018

U.S. News

The Financial Times reports that the possibility of U.S. tariffs on steel and aluminum imports provided stock market boosts to some of Europe’s largest steel producers. The Commerce Department on Friday recommended substantial tariffs on imports of steel and aluminum, which would normally be unwelcome to foreign firms, though many European metals producers have operations in the U.S. that would stand to benefit from protectionist policies. FT

According to the Wall Street Journal, while tariffs on imported solar panels may slow the expansion of solar capacity, government mandates requiring the use of renewable energy will likely mean that solar capacity should keep expanding. The cost of solar panels has continued to decline as storage technology has improved and firms have been stockpiling panels in advance of the tariffs, meaning that they will likely be able to comply with government mandates to build new solar installations. WSJ

U.S. Economic News

U.S. Economic News

February 16, 2018

U.S. Economic Indicators

Privately-owned housing starts jumped 9.7% in January to a seasonally adjusted annual rate of 1.33 million (up 7.3% year-over-year). Housing permits rose 7.4% to a 1.40 million annual pace in January and are up 7.4% on the year.  Census Bureau Report
 
The University of Michigan Consumer Sentiment Index rose 4.2 points to 99.9 in the preliminary February reading, and is up 3.6 points on the year.
The Index of Consumer Expectations rose 3.9 points to 90.2, while the Current Economic Conditions Index increased 4.6 points to 115.1. Report

U.S. News

The Wall Street Journal reports that National Economic Council Director Gary Cohn does not believe that recent tax cuts and other fiscal stimuli would cause inflation to accelerate and overheat the economy. Cohn also said that the U.S. knows how to deal with inflation, which could be spurred by increasing deficits, but does not know how to deal with deflation. WSJ

According to the Wall Street Journal, a new report from the Brookings Institution shows that many borrowers who take out so-called “jumbo” student loans of more than $50,000 fail to repay their debt. As of 2014 there were roughly 5 million borrowers with “jumbo” loan balances that represent 58% of all U.S. student debt, which could become problematic as interest rates rise and it becomes more difficult to refinance existing debt. WSJ

U.S. Economic News

U.S. Economic News

February 15, 2018

U.S. Economic Indicators

The NAHB Housing Market Index held steady at 72.0 in February, hovering near record highs.  The outlook for the next six months remains solid, though builders still face increasing materials prices and shortages of labor.  NAHB Report
 
Industrial production edged down 0.1% in January (up 3.7% Y/Y), after increasing 0.4% (revised) in December. 
Capacity utilization fell 0.2 point to 77.5 in January.  Fed Report
 
Initial jobless claims rose 7,000 to 230,000 last week.
The four-week moving average increased 3,500 to 228,500.  DOL Report
                                                                                                             
The headline Producer Price Index (“PPI”) for final demand rose 0.4% in January and is up 2.7% since January of last year.
 The core — which removes the volatile prices of food, energy, and trade services — also increased 0.4% and is up 2.5% on the year.  BLS Report

 

 

U.S. Economic News

U.S. Economic News

February 14, 2018

U.S. Economic Indicators

Consumer prices rose 0.5% in January (up 2.1% on the year).  The “core” CPI, which excludes food and energy, rose 0.3% in January and is up 1.8% on the year.  BLS Report
 
Retail sales fell 0.3% in January but were up 3.6% on the year.  
Core sales — which excludes autos, gasoline, building materials, and food services — were unchanged. Census Bureau Report
 
Business inventories rose 0.4% in December and were up 3.2% from last year.  
Manufacturers’ sales increased 0.6% and were up 5.6% on the year. Census Bureau Report

U.S. News

The Wall Street Journal reports that the White House is considering Cleveland Fed President Loretta Mester for the vice chairwoman of the Federal Reserve Board. Mester, who has led the Cleveland Fed since 2014, is considered to be moderately hawkish and would likely support raising interest rates more quickly in order to quash inflationary pressures in the economy. WSJ

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