Economy

Economic Data Roundup (04/25/2016)

4/25/16 12:00 PM

iStock_000009946822_Small.jpgThere were two important reports on the U.S. economy released this morning. First, data from the Federal Reserve Bank of Dallas showed that business activity in the southern region of the country slowed slightly this month. Specifically, the general activity index edged lower from -13.6 to -13.9 in April, worse than expected and the 16th sub-zero (contractionary) print in a row. The production index, a key measure of state manufacturing conditions, rose to +5.8 this month, the second positive (expansionary) reading since December. Under the hood, measures of current production, capacity utilization, new orders, shipments, capital expenditures, employment, and wage growth all improved in April but managers’ outlooks on business activity over the next six months deteriorated. The Texas economy appears to be suffering a bit more than other regions of the country at the moment, likely due to the continued rout in global commodity prices. For example, one surveyed manager said that “It is a bad time for manufacturing, agriculture and mining—the only sectors that actually create wealth.” Another respondent said that “Over-taxation, complicated export/import regulations and increasingly burdensome labor regulations are slowing down growth, hiring and expansion.”

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Elsewhere, a report from the Census Bureau showed that sales of new single-family homes in America declined by 1.5 percent in March to a seasonally adjusted annual rate of 511,000 units. This was the third month-over-month drop in a row and worse than economists had expected, with much of the weakness being related to a 23.6 percent plunge in sales in the western region of the country. Further, the prior month’s print was revised slightly higher and new home sales are still up 5.4 percent over the past year. The inventory of new single-family homes edged higher to 246,000 units, and months’ supply rose to 5.8 at the current sales pace. The median sales price of new houses sold last month slid to $288,000. Jim O’Sullivan, chief U.S. economist at High Frequency Economics, added that “Housing is certainly not booming. Some people may be shut out of the market because lending standards are still tight. There may still be some reluctance to buy versus rent.”

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Sources: Econoday, Bloomberg, Twitter, ZH, FRBD, U.S. Census Bureau, FRBSL

Post author: Charles Couch