Publications

U.S. Economic Indicators

New orders of manufactured durable goods fell 14.4% in March after rising 1.1% (revised) in February. Excluding transportation, new orders fell 0.2% last month after declining 0.7% the month before. Census Bureau Report

The University of Michigan Consumer Sentiment Index fell 17.3 points to 71.8 in the final April reading and is down 25.4 points from April of last year. The Index of Consumer Expectations fell 9.6 points to 70.1, while the Current Economic Conditions Index fell 29.4 points to 74.3. University of Michigan

U.S. News

The Financial Times reports that while the Federal Reserve is doing its best to remain politically neutral during its first large-scale foray into fiscal policy since the 2008 financial crisis, it is facing heavy scrutiny as it attempts to manage trillions in financial support for distressed companies and municipalities. While Fed Chairman Jay Powell entered the current crisis in good standing with a majority of Americans, the Fed’s central role in administering corporate bailouts and involvement in public and municipal financial aid sharply raises the risk of political – and public – backlash for the central bank. FT

U.S. Economic Indicators

Initial jobless claims fell 810,000 to 4,427,000 last week. The four-week moving average rose 280,000 to 5,786,500. DOL Report

New home sales fell 15.4% in March to a seasonally adjusted annual pace of 627,000 and were down 9.5% compared to a year ago. The median sales price fell to $321,400, and the inventory of new homes increased to 6.4 months at the current sales rate. Census Bureau Report

U.S. News

Greg Ip writes for the Wall Street Journal that while this year’s federal budget deficit is set to reach a post-World War II high of 18.6% of GDP, current soaring debt levels do not necessarily imply an impending debt or inflation crisis. According to Ip, with interest rates expected to remain near zero for the foreseeable future, there is little evidence to suggest that the added debt will come at a higher economic cost. WSJ

U.S. News

The Financial Times reports that despite strong demand from grocery stores, U.S. food producers are struggling with supply chains that cannot be easily shifted from restaurants to supermarkets. Packaging and preparation discrepancies between food destined for food service operations and individual consumers have created bottlenecks and significant financial strain for farmers and ranchers. FT

According to the New York Times, the decline in sales of clothing and accessories by more than half due to the coronavirus pandemic will likely be the final nail in the coffin for many large American department stores. Department store chains had been declining steadily for much of the past decade as e-commerce gained traction and mall rents rose, with very few expected to survive the current cratering of demand. NYT

U.S. Economic Indicators

Existing home sales fell 8.5% to a seasonally adjusted annual rate of 5.27 million in March but were up 0.8% compared to a year ago. Home sales declined in all four major regions, with the largest decrease occurring in the West. NAR Report

U.S. News

The Wall Street Journal reports that the coronavirus pandemic is impacting state labor markets to varying degrees, with some states, like Hawaii, seeing as much as one-fifth of the labor force filing for unemployment benefits, compared to less than five percent in South Dakota. There is little correlation between state-level jobless claims and the number of coronavirus infections; rather, the variation in impacts has been attributed to when states closed businesses, how dependent states are on the most impacted industries, and administrative capabilities for processing unemployment claims. WSJ

According to the New York Times, there is considerable uncertainty surrounding when – if ever – global travel, conventions, and hotel stays will return to pre-pandemic levels. While hotels may see a sharp rebound by next year, airline industry analysts note that it could take two to five years to return to some level of normalcy, with general expectations that there will be both temporary and persistent changes to accommodate a “new normal.” NYT

U.S. Economic Indicators

The Chicago Fed National Activity Index decreased from +0.06 in February to -4.19 in March. All four broad categories of indicators — employment, consumption, production, and sales, orders, & inventories — contributed to the decline. Chicago Fed Report

U.S. News

The Washington Post reports that the White House and congressional leaders are nearing agreement on a $470 billion deal to replenish funding for small business loans and boost spending for hospitals and coronavirus testing. The agreement, which includes $310 billion for the Paycheck Protection Program, $60 billion for emergency small business loans, and $100 billion for hospitals and testing, could be passed as soon as Wednesday as lawmakers tentatively prepare to return to Washington this week. WaPo

According to the Wall Street Journal, futures contracts for West Texas Intermediate – the benchmark for U.S. crude prices – plunged further on Monday, indicating that production cuts are having little effect on ballooning oil inventories. The coronavirus pandemic, combined with the Saudi-Russia price war, has created highly unusual market conditions and forced deep discounts on oil available for delivery in the next couple of months. WSJ