Economy

Economic Data Roundup (06/23/2016)

6/23/16 12:00 PM

iStock_000009946822_Small.jpgThere were two important reports on the U.S. economy released this morning. First, data from Markit Economics showed that manufacturing activity in America rebounded this month. Specifically, the flash (mid-month) reading on Markit’s manufacturing purchasing managers’ index (PMI) was 51.4, an increase from May’s 50.5 print and a 3-month high for this metric. Under the hood, measures of output, new orders growth, and employment all improved this month, and surveyed manufacturers attributed the rise in production volumes to “a rebound in customer demand.” However, a few respondents said that “heightened economic uncertainty had led to delayed decision making and greater risk aversion among clients in June.” Several of this indicator’s subcomponents remain near recovery lows but overall this was a positive report which supports the encouraging regional manufacturing data released earlier this month. Markit’s chief economist Chris Williamson, though, cautioned that “Any improvement could be largely traced to better export sales, in turn linked to the weakening of the dollar compared to earlier in the year. Domestic demand was again worryingly weak, especially from business customers, meaning overall growth of order books remained subdued.”

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Elsewhere, a report from the Census Bureau showed that sales of new single-family homes in America fell by 6.0 percent in May to a seasonally adjusted annual rate of 551,000 units. This was worse than economists had expected and the largest decline in eight months, although it is worth remembering that sales rose significantly in April. The median sales price of new houses sold in May fell to $290,400, the inventory of new single-family homes edged higher to 244,000 units, and months’ supply jumped to 5.3 at the current sales pace. New home sales declined everywhere across the country last month except for in the Midwest. Altogether, this was a disappointing report but it describes a much smaller segment of the U.S. housing market than existing home sales, which fared much better in May. Omair Sharif, senior U.S. economist at Société Générale, added that “New-home sales are still doing relatively well, but the spring selling season is not quite as robust as what we had thought, given the downward revisions. The level of sales is picking up, but it’s still a grind.”

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

Post author: Charles Couch