Publications

U.S. Economic Indicators

The ISM Manufacturing Index fell 7.6 points to 41.5 in April, indicating the sector is in contraction. The Employment Index fell 16.3 points to 27.5, while the New Orders Index fell 15.1 points to 27.1. ISM Report

Construction spending increased 0.9% in March to an annualized rate of $1.36 trillion. Private construction rose 0.7% and public construction rose 1.6%. Census Bureau Report

U.S. News

The Wall Street Journal reports that landlords are anticipating lower rent collections this month due to surging unemployment and planned rent strikes across the country. While April rent payments were down somewhat from normal levels, a recent survey found that barely half of renters are confident they will be able to pay their entire May rent. WSJ

U.S. Economic Indicators

Initial jobless claims fell 603,000 to 3,839,000 last week. The four-week moving average fell 757,000 to 5,033,250. DOL Report

Real disposable personal income decreased 1.7% in March, while real personal consumption expenditures (PCE) fell 7.3%. The PCE price index fell 0.3% (up 1.3% Y/Y), and the core price index fell 0.1% (up 1.7% Y/Y). BEA Report

U.S. News

The Financial Times reports that the Federal Reserve warned of lasting medium-term economic damage to the U.S. economy at this week’s FOMC meeting, indicating that the Fed is prepared to make additional policy moves as necessary while stopping short of any major announcements. Fed chair Jay Powell cited three key risk factors guiding the Fed’s gloomier outlook: the unknown future trajectory of the virus, the potential loss of productive capacity as workers become disconnected from the labor force, and the global scope of the crisis.  FT

U.S. Economic Indicators

The advance estimate of Q1 GDP indicates that the U.S. economy contracted at an annualized rate of 4.8%, a greater contraction than consensus estimates. The decline in real GDP reflects negative contributions from consumer spending, business investment, and private inventories that were partly offset by positive contributions from residential investment, government spending, and net exports. BEA Report

The National Association of Realtors pending home sales index fell 20.8% in March (down 16.3% Y/Y).  NAR reports that the housing market is grappling with the coronavirus-induced shutdown which has reduced new listings and contracts. NAR Report

U.S. News

According to the Financial Times, many U.S. restaurants that applied for loans through the Paycheck Protection Program are likely to return the funds as it becomes clear that the program’s requirements are poorly suited to the restaurant industry. The requirement that loans be spent within eight weeks and primarily on payroll render the loans less effective for the capital-intensive, cash-strapped restaurant industry. FT

U.S. Economic Indicators

The U.S. Census Bureau Advance Economic Indicators Report shows that the goods deficit expanded to $64.2 billion in March from $59.9 billion in February. Meanwhile, wholesale inventories fell 1.0% and retail inventories increased 0.9%. Census Bureau Report

The Conference Board’s Consumer Confidence Index decreased from 118.8 (revised) in March to 86.9 in April. Consumers’ assessment of current conditions deteriorated considerably, while near-term expectations for jobs and financial prospects improved somewhat. Conference Board Report

U.S. News

The Wall Street Journal reports that government economic stimulus measures passed in March are complicating state efforts to reopen businesses as many workers – roughly half – stand to earn more from enhanced unemployment benefits than at their previous jobs. The initial wave of coronavirus-related job losses was concentrated in the restaurant, hospitality, and retail sectors, where median hourly pay is below the minimum payout under current unemployment benefits. WSJ

U.S. News

According to the Wall Street Journal, residents in New York City and other major U.S. cities are planning rent strikes for May 1 to push for government relief for renters and small landlords experiencing hardship from the coronavirus crisis. Around one-third of U.S. households are renters, and just under 90% paid at least part of their April rent by the middle of last month, a lower rate than normal. WSJ

The Financial Times reports that Federal Reserve officials are unlikely to announce additional guidance on central bank actions to support the economy during the pandemic at the upcoming FOMC meeting this week. While some investors are calling for clearer guidance on the path of interest rates and duration of asset purchases, central bankers are likely to refrain from any new commitments while they consider whether or not additional measures – such as aggressive forward guidance or yield curve control – may be warranted. FT