Publications

U.S. Economic Indicators

Existing home sales jumped 20.7% to a seasonally adjusted annual rate of 4.72 million in June but were down 11.3% compared to a year ago. Home sales increased in all four major regions, with the West experiencing the greatest sales recovery. NAR Report

U.S. News

The New York Times reports that although the pandemic has prompted many companies to shift supply chains away from China, they aren’t necessarily moving production back to the United States. Production and labor costs remain much cheaper in countries such as Vietnam and Mexico, and the economic hit from the pandemic has manufacturers hesitant to invest in new American factories. NYT

The Wall Street Journal reports that more U.S. retailers have already filed for chapter 11 bankruptcy thus far in 2020 than all of last year, underscoring the financial hardship caused by the coronavirus pandemic. Even retailers considered relatively healthy before the pandemic have been forced to adopt numerous measures to try and stay afloat, including obtaining additional debt, pivoting to e-commerce, reducing workforces, and delaying rent payments. WSJ

U.S. Economic Indicators

The Chicago Fed National Activity Index improved from +3.50 in May to +4.11 in June. Three of the four broad categories of indicators – employment, consumption, and production – contributed positively to the index, while the sales, orders & inventories category contributed negatively. Chicago Fed Report

U.S. News

The New York Times reports that the coronavirus pandemic may shift activity away from big cities, especially if companies find work from home policies to be successful in the longer term. Cities have traditionally benefitted from dense networks of innovative businesses and highly skilled workers, but skyrocketing rents – coupled with fewer urban amenities and increased teleworking due to the pandemic – may make them less attractive for both companies and workers. NYT

The Wall Street Journal reports that hotels are performing poorly in areas that are experiencing a surge in coronavirus cases, reflecting consumer fears of the virus and an ebbing of pent-up demand in recent weeks. High vacancies at hotels across the country give consumers increased flexibility in their travel plans but limit the consistency of reservations (and revenues) for hotel owners. WSJ

U.S. News

The New York Times reports that there has been an uncharacteristic surge in corporate borrowing during the ongoing economic downturn, driven largely by the Fed’s actions to stabilize markets by keeping interest rates near zero and buying corporate debt. Even high-risk and heavily indebted companies have issued new bonds during the crisis, implying that the low cost of borrowing may help companies stay afloat that otherwise would have gone bankrupt this year. NYT

The Washington Post reports that the White House is pushing for a payroll tax cut and liability protections for businesses ahead of negotiations in Congress over the structure of a new coronavirus stimulus bill. GOP lawmakers are exploring options to limit the cost of the bill while returning people to the workforce, including reducing enhanced unemployment benefits and limiting benefits to those at the lower end of the income distribution. WaPo

U.S. Economic Indicators

Privately-owned housing starts rose 17.3% in June to a seasonally adjusted annual rate of 1.19 million (down 4.0% year-over-year). Housing permits rose 2.1% to a 1.24 million annual pace in June (down 2.5% year-over-year). Census Bureau Report

The University of Michigan Consumer Sentiment Index fell 4.9 points to 73.2 in the preliminary July reading and is down 25.2 points from July of last year. The Index of Consumer Expectations fell 6.1 points to 66.2, while the Current Economic Conditions Index fell 2.9 points to 84.2. University of Michigan

U.S. News

The Wall Street Journal reports that the labor market recovery is showing signs of slowing down, with fewer job openings, weaker growth in worker hours, and persistently high numbers of new applications for unemployment benefits. Job postings declined in all 50 states and Washington, D.C. in July, suggesting that the slowdown reflects a broader sense of economic uncertainty and is not limited to states experiencing a surge in virus cases. WSJ

U.S. Economic Indicators

Initial jobless claims fell 10,000 to 1,300,000 last week. The four-week moving average fell 60,000 to 1,375,000. DOL Report

Retail sales rose 7.5% in June and were up 1.1% from a year ago. Core sales – which exclude autos, gasoline, building materials, and food services – increased 5.6%. Census Bureau Report

Business inventories fell 2.3% in May and were down 4.8% from May of last year. Manufacturers’ sales increased 3.1% in May but were down 19.5% compared to a year ago. Census Bureau Report

The NAHB Housing Market Index rose 14 points to 72 in July, back to its pre-pandemic reading from March. NAHB reports that the housing market may lead the economic recovery as builders are seeing increased demand due to the small existing home inventory. NAHB Report