Publications

U.S. Economic Indicators

New home sales rose 7.1% to a seasonally adjusted annual pace of 713,000 in August and were 18.0% above the August 2018 rate. The median sales price rose to $328,400, and the inventory of new homes fell to 5.5 months at the current sales rate. Census Bureau Report

U.S. News

The Wall Street Journal reports that the U.S. Labor Department has implemented a new rule that raises a key salary threshold for determining which workers are eligible for overtime pay, increasing the number of workers who qualify by an estimated 1.2 million. The threshold below which workers generally qualify for time-and-a-half pay will increase from $23,660 to $35,568, and is likely to boost pay for workers industries such as retail, fast food, higher education, and home health care. WSJ

According to the Washington Post, Minneapolis Federal Reserve President Neel Kashkari believes the U.S. economy is faltering due to both the ongoing trade war and unnecessarily high interest rates. He is concerned that the labor market is already showing signs of cooling, arguing that the Fed should act now before companies stop hiring or begin layoffs, rather than waiting until such fears materialize. WaPo

U.S. Economic Indicators

The Conference Board’s Consumer Confidence Index declined from 134.2 (revised) in August to 125.1 in September. Consumer Confidence eased for a second month in a row as consumers were somewhat less positive in their assessment of current and future conditions. Conference Board Report

U.S. News

The Wall Street Journal reports that the share of lower-income Americans leaving their jobs for new ones has risen to its highest level since 2014, suggesting that workers left behind earlier in the expansion are benefiting from higher-paying job opportunities. This trend likely explains the broader increase in the share of workers quitting their jobs, with the official quits rate edging up to 2.4% in July. WSJ

According to the Washington Post, the planned trade agreement between the U.S. and Japan has been delayed over Japanese concerns that auto and auto parts shipments to the U.S. may still face punitive levies in the near future. Last year, Japan shipped more than $40 billion worth of vehicles to the U.S., along with over $1.8 billion worth of auto parts. WaPo

U.S. Economic Indicators

The Chicago Fed National Activity Index rose from -0.41 in July to 0.10 in August. Indicators of employment, consumption, and sales, orders, & inventories made negative contributions to the Index, while production-related indicators contributed positively. Chicago Fed Report

U.S. News

Paul Kiernan of the Wall Street Journal reports that the personal saving rate has risen from just 3.7% in 2010 to 8.2% in 2019, even though saving usually declines as consumer optimism rises during economic expansions. While some of the uptick in the average saving rate could be due to increased caution among consumers after the last recession or aging baby boomers preparing for retirement, most of the bump can be attributed to wealthy households holding onto gains from the 2018 tax cuts. WSJ

The Financial Times reports that investors are increasingly concerned about a global recession, with the likelihood of a downturn in the next year standing at over 50%, according to a recent survey of asset managers. Survey respondents expressed a dimming outlook for business confidence, corporate earnings, and U.S. employment over the next year. FT

U.S. News

According to the Wall Street Journal, St. Louis Fed leader James Bullard stated the central bank should have reduced rates by 50 basis points at its latest meeting to provide insurance against continued weak inflation and elevated downside risks. Bullard was one of three Fed officials to vote against Wednesday’s quarter-point rate cut, but was the only dissenter who favored reducing rates aggressively in the present and raising them later if economic risks failed to materialize. WSJ

The Washington Post reports that the U.S. is temporarily exempting more than 400 Chinese products from tariffs imposed last year as a result of over 1,100 exclusion requests filed by U.S. companies. The U.S. exemptions follow China’s move to cancel or ease tariffs on a variety of U.S. products ahead of high-level trade talks planned for next month. WaPo

U.S. Economic Indicators

The Conference Board’s Leading Economic Index (“LEI”) was unchanged in August following a 0.4% increase in July. Improvements in housing permits and credit conditions offset weakness from manufacturing and the interest rate spread. Conference Board Report

Existing home sales rose 1.3% to a seasonally adjusted annual rate of 5.49 million in August and are up 2.6% compared to a year ago. NAR notes that falling mortgage rates are luring buyers into the market, though low inventory numbers continue to push up prices. NAR Report

Initial jobless claims rose 2,000 to 208,000 last week. The four-week moving average fell 750 to 212,250. DOL Report

U.S. News

According to the Wall Street Journal, the split among Fed officials over the central bank’s quarter-point rate cut Wednesday is symptomatic of broader disagreement among officials about the extent to which trade tensions and slowing global growth will affect the U.S. economy. Statements by Fed Chairman Jerome Powell appear to leave the door open for further rate reductions amid concern that trade policy uncertainty may be weighing on business investment and manufacturing activity. WSJ

The Financial Times reports that the OECD has downgraded its global growth projection by 0.3 percentage point to 2.9 percent, the weakest performance since the 2008-09 financial crisis. It warned that the global economic outlook is “increasingly fragile and uncertain,” urging countries to remove tit-for-tat trade barriers and implement fiscal stimulus measures. FT