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Apr 24, 2018
Consumer confidence rose 1.7 points in April, rising to 128.7 and offsetting roughly half of last month's 3-point decline. The improvement was split between a 1.5-point gain in present situations and a 1.9-point gain in consumer expectations. While both indexes rose, the underlying data showed more of a trend towards neutral sentiment, rather than rising optimism. Business conditions and employment conditions were rated more normal than they were in March, with fewer respondents willing to describe conditions as good or bad. Expectations were a bit brighter, thanks mostly to a strong rebound in business expectations. Purchase plans recovered after last month's drop, though vacation plans remain deflated.
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Apr 24, 2018
U.S. economic policy uncertainty is climbing because of the dynamics in Washington DC. Some uncertainty about monetary policy is also pushing economic policy uncertainty higher as financial markets appear to be betting on a policy error by the Fed. The good news is that the economic costs of elevated policy uncertainty have been minimal. Still, if a significant increase in policy uncertainty were to occur, it shouldn't be ignored, because it could weigh on financial market conditions and hurt business investment. The four-week moving average in our U.S. policy uncertainty index increased from 118.3 to 119.6 in the week ended April 20.
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Apr 24, 2018
Existing-home price appreciation accelerated in the three months ending in February compared with the same period in January. Year-ago growth in the 20-city composite index rose to 6.8% in February, up from the 6.4% pace of growth registered in January. In addition, year-ago growth in the 10-city composite index moved up to 6.5% in the three months ending in February, up from the 6% rate clocked in January. Further, growth in the national house price index also accelerated to 6.3% in February compared with the 6% pace set in January.
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Apr 23, 2018
Global business confidence remains very strong, and close to the record high set in spring 2015. Talk of higher U.S. tariffs, global trade wars, and wild swings in global stock markets have had no discernible impact on sentiment. Responses to all nine questions in the survey are upbeat, and overall confidence is consistent with a global economy that is growing firmly above its potential.
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Apr 23, 2018
Existing-home sales continued to recover in March and are closing on their November peak. Total sales increased 1.1% in March but were still down by 1.2% from March 2017. The monthly increase was evenly split between single-family sales and condo/co-op sales. Inventory is keeping up with sales, so the existing-home market isn't getting more supply-scarce despite still being very tight. Increased inventory also kept the median existing-home price growth at 5.9% year-over-year, close to its average over the past three years.
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Apr 23, 2018
Weakness in the miscellaneous items and motor vehicle and parts subsectors weighed heavily on wholesale trade in February. Wholesale sales dropped 0.8% to C$62.8 billion. The declines were not limited to miscellaneous items and motor vehicles and parts, as four of the seven subsectors, representing 64% of all sales, retreated. In volume terms, wholesale sales fell 0.9% from the prior month and inventories were unchanged.
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Apr 20, 2018
As expected, there were signs of slowing job growth in the March regional and state employment report. Compared with February, nonfarm employment rose and unemployment fell in fewer states, though these trends have more to do with supply constraints and a lack of qualified workers than weak demand for labor. Many states have entered the mature phase of the business cycle where labor markets are at or beyond full employment. Hawaii once again had the lowest jobless rate, 2.1%, but rates in Maine (2.7%) and Kentucky (4%) set new series lows. Employment rose in just two states, Texas and Utah, while the biggest year-over-year gains occurred in Idaho and Utah (3.3% each), followed by Nevada (2.9%).
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Apr 20, 2018
Retail sales increased 0.4% to C$49.8 billion in February. Sales were up in four of 11 subsectors, with higher sales at new car dealers and general merchandise stores the main contributors to the gain. Excluding sales at motor vehicle and parts dealers, retail sales were unchanged. In volume terms, retail sales increased 0.3%.
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Feb 27, 2018
Manufacturing conditions in the Richmond Federal Reserve District expanded at a robust pace in February. The composite index climbed from 14 to 28 this month. An 11-point increase in new orders and a 16-point increase in shipments supported manufacturing's expansion. The number of employees and average workweek have climbed to all-time highs. Six-month expectations were elevated in most components of the survey.
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Feb 27, 2018
The Federal Housing Finance Agency Purchase-Only House Price Index rose 6.5% in December on a year-ago basis, which is in line with the previous month's increase. The limited supply of inventories, in addition to steady demand, is fueling fast house price appreciation. House price improvements are broad-based with all regions on a year-ago basis posting gains. The Mountain and Pacific census divisions have the fastest house price growth, while the West North Central census division has the slowest house price growth on a year-ago basis.
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Feb 26, 2018
New-home sales did not get off to a good start this year. January sales fell 7.8% from December and are 1% below their level from January 2017. The regional picture was mixed, with the South leading the sales decline and the Midwest posting strong growth. The market is now slightly looser than a few months earlier, and price growth has slowed slightly, with the appreciation rate of the median new-home price falling to 2.5%.
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Feb 26, 2018
The pace of U.S. economic growth moved sideways in January. The Chicago Fed National Activity Index ticked down to 0.12 from 0.14 in the previous month. Two of the four broad categories that make up the index decreased from the prior month, and two made negative contributions to the headline index. The index's three-month moving average declined to 0.17. The headline index indicates U.S. economic activity was above average.
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Feb 23, 2018
The U.S. expansion shows no signs of abating any time soon. In the week ended February 16, the ECRI weekly leading index declined to 149 from 149.8. The WLIg, the headline figure's smoothed, annualized growth rate, edged down to 7.5% from 8.5%.
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Feb 23, 2018
Inflation decelerated in January, but the misleading result reflects strong energy price growth from a year earlier. Consumer prices surged 0.5% from the prior month on a seasonally adjusted basis, but inflation slowed from 1.9% to 1.7%. Inflation will likely accelerate in the months ahead as the year-ago comparison on energy prices begins to shift. Significant appreciation in household operations, furnishings and equipment prices, as well as transportation, drove the January gain.
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Feb 23, 2018
The Canadian labor market made few gains in December. Average weekly earnings of nonfarm employees were $993, roughly unchanged from November's revised figure and up 2.3% from December 2016. The number of nonfarm employees rose by 31,600 from November. At 33 hours, the average workweek was unchanged from November and up from 32.8 a year earlier.
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Feb 23, 2018
The Moody's Delinquency Tracker total delinquency rate fell 5 basis points in January, to 5.81%. The decrease mainly stems from the resolution of delinquent 2007 loans. Multifamily, industrial and office delinquency rates declined while hotel and retail delinquency rates increased. All regional delinquency rates fell this month except for the Midwest. The total balance of CMBS conduit loans decreased in January since payoffs and dispositions outweighed new issuance.
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Jan 31, 2018
A much larger than expected decline in crude oil inventories will put downward pressure on oil prices. Crude oil inventories rose by 6.8 million barrels in the week ended January 26, leaving behind analyst predictions of a 309,000-barrel increase. Gasoline inventories fell by 2.0 million barrels, contrary to analyst expectations of a 1.9 million-barrel rise. Distillate inventories fell by 1.9 million barrels, beating analyst predictions of a 231,000-barrel decrease. Refinery capacity utilization fell to 90.9% from 88.1%, more than analyst expectations of a 0.62-percentage point dip. Total U.S. oil demand was 7.6% higher than a year earlier.
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