U.S. Economic News

U.S. Economic News

November 21, 2019

U.S. Economic Indicators

Existing home sales rose 1.9% to a seasonally adjusted annual rate of 5.46 million in October and are up 4.6% compared to a year ago. NAR attributes the rise in sales to low interest rates, continuing job expansion, and favorable mortgage rates. NAR Report

The Conference Board’s Leading Economic Index (“LEI”) declined 0.1 percent in October following a 0.2 percent (revised) decline in September. The LEI declined for the third month in a row due to continued manufacturing weakness and new softness in the labor market. Conference Board Report

Initial jobless claims were unchanged at 227,000 last week. The four-week moving average rose 3,500 to 221,000. DOL Report

U.S. News

The Financial Times reports that 2019 U.S. bond fund inflows are on track for one of their highest years on record as investors in search of yield rush to purchase corporate debt in an environment of very low interest rates. Fed officials warned at their latest rate-setting meeting about growing imbalances in the corporate debt market, noting that deteriorating credit quality and increased risk spreads could amplify the effects of an adverse shock to the economy. FT

According to the Wall Street Journal, President Trump’s decision to allow a November deadline for imposing tariffs on foreign auto imports to lapse without taking action has not removed the threat of potential tariffs. The lack of clear signals from the White House has puzzled auto executives and policymakers in Japan and the E.U., which together account for roughly a third of total U.S. auto imports. WSJ

A Tale of Two Sectors: Manufacturing Weakness & Consumer Strength in 2019

A Tale of Two Sectors: Manufacturing Weakness & Consumer Strength in 2019

November 20, 2019

Strong consumer spending has been the main driver of U.S. economic growth throughout 2019, which has helped extend the longest economic expansion in U.S. history. This year has also seen the U.S. manufacturing sector slip into contraction – and yet, the rest of the economy has hummed along. Paradoxical performance across sectors raises the question of whether (and how) manufacturing weakness might spread to the rest of the economy, or even pull the U.S. into economic recession.

Related Documents: A Tale of Two Sectors: Manufacturing Weakness & Consumer Strength in 2019

U.S. Economic News

U.S. Economic News

U.S. News

According to the Wall Street Journal, New York Fed leader John Williams stated the central bank isn’t committed to any particular policy path, though officials are content to leave rates steady for the time being. He noted that the economy “is in a very good place” at the moment, and stressed the importance of the central bank’s flexibility to respond to changing economic facts. WSJ

The Washington Post reports that the House passed a short-term spending bill to extend government funding through December 20, though the bill must still be passed by the Senate and approved by President Trump by midnight Thursday to avert a government shutdown. Both the Senate and the President are widely expected to approve the bill ahead of the deadline. WaPo

U.S. Economic News

U.S. Economic News

November 19, 2019

U.S. Economic Indicators

Privately-owned housing starts rose 3.8% in October to a seasonally adjusted annual rate of 1.31 million (up 8.5% year-over-year). Housing permits rose 5.0% to a 1.46 million annual pace in October and are up 14.1% from last year. Census Bureau Report

U.S. News

The Financial Times reports that President Trump had a “cordial” meeting with Fed Chairman Jerome Powell on Monday, at which Powell stressed that the direction of monetary policy will depend on incoming economic data. Consistent with his comments at congressional hearings last week, Powell insisted that policy would continue to be dictated by the twin goals of stable inflation and maximum employment. FT

According to Bloomberg, a new University of Massachusetts Boston study revealed that around half of Americans living alone over age 65 lack the financial resources to pay for basic needs such as adequate food and housing. States in the Northeast tend to have the highest rates of elder economic insecurity, while more than half of all financially insecure elders rely on Social Security for at least 90% of their income. Bloomberg

U.S. Economic News

U.S. Economic News

November 18, 2019

U.S. Economic Indicators

The NAHB Housing Market Index edged one point lower to 70 in November. Conditions for single-family home builders remain positive, helped by low mortgage rates and continued job growth. NAHB Report

U.S. News

Paul Hannon reports for the Wall Street Journal that global cross-border flows of goods are likely to stay weak as 2019 draws to a close, according to the WTO’s latest leading indicator for trade flows. Although there are signs of a pickup in export orders, container shipping, and auto shipments, the improvements have been offset by continued weakness in airfreight and raw materials and electronic components shipments. WSJ

The Wall Street Journal reports that according to some economists, labor market churn – the shuffle of workers between jobs and employers – may be a better predictor of wages, inflation, and productivity than the unemployment rate, possibly explaining why wages have risen less quickly during the current expansion than official unemployment figures would suggest. Wage growth and inflation may stay soft even as labor markets continue to tighten if workers are more reluctant to switch jobs today than in the past. WSJ