Publications

U.S. Economic Indicators

The Chicago Fed National Activity Index rose from -0.31 (revised) in February to -0.15 in March. The employment, production, and sales, orders, and inventories categories contributed positively, while the personal consumption and housing category contributed negatively. Chicago Fed Report

Existing home sales fell 4.9% to a seasonally adjusted annual rate of 5.21 million in March, and are down 5.4% compared to a year ago. NAR notes that sales activity is underperforming relative to the strong labor market, and the impact of lower mortgage rates has yet to be fully realized. NAR Report

U.S. News

The Wall Street Journal reports that recent public remarks by Federal Reserve officials suggest that while a rate cut is not likely in the near term, officials are starting to discuss changing the threshold for cutting rates. Some Fed officials are open to lowering interest rates if core inflation continues to drift below the Fed’s 2.0% target, while those opposed to cutting rates are becoming increasingly hesitant to raise them. WSJ

U.S. Economic Indicators

Privately-owned housing starts decreased 0.3% in March to a seasonally adjusted annual rate of 1.14 million (down 14.2% year-over-year). Housing permits dropped 1.7% to a 1.27 million annual pace in March and are down 7.8% on the year.  Census Bureau Report

U.S. News

The Wall Street Journal reports that Dallas Federal Reserve President Robert Kaplan stated that improving U.S. economic growth is unlikely to change his belief that short-term interest rates are set appropriately. Recent reports that consumer spending improved and the trade deficit narrowed suggest economic growth was stronger in the first quarter than previously estimated. WSJ

The Financial Times reports that according to analysis by the International Trade Commission, the USMCA trade deal would be a tailwind for U.S growth and a boost for the automotive sector in particular. The trade agreement is forecasted to add 0.35 percent to U.S. GDP and expand exports to Canada and Mexico. FT

U.S. Economic Indicators

Initial jobless claims fell 5,000 to 192,000 last week, the lowest level in nearly 50 years. The four-week moving average fell 6,000 to 201,250. DOL Report

Retail sales rose 1.6% in March and were up 3.6% on the year.  Core sales — which exclude autos, gasoline, building materials, and food services — increased 1.0%. Census Bureau Report

The U.S. Census Bureau reports that wholesale merchant inventories edged up 0.2% in February to $668.9 billion. Inventories were up 6.9% year-over-year. Census Report

The Conference Board’s Leading Economic Index (“LEI”) increased 0.4% to 111.9 in March but is largely unchanged from six months ago. Despite the solid gain in March, the trend in the US LEI continues to moderate, suggesting that growth is likely to decelerate toward 2 percent by year’s end. Conference Board Report

U.S. News

The Wall Street Journal reports that Philadelphia Federal Reserve President Patrick Harker maintains that the Fed may be able to raise interest rates two more times over the next couple of years. Harker believes the Fed should continue its wait-and-see approach as short-term data fluctuations are assessed, though a strong labor market, muted inflation, and sustained moderate growth are reasons to be optimistic about the economy. WSJ

U.S. Economic Indicators

The U.S. trade deficit decreased from $51.1 billion in January (revised) to $49.4 billion in February. The goods deficit fell by $1.2 billion while the services surplus increased by $0.5 billion. Census Bureau Report

U.S. News

The Financial Times reports that the U.S. and Japan have agreed to accelerate trade talks by narrowing the focus to agriculture and digital trade. The biggest area of contention is the automobile sector as Japan pushes for lower tariffs on finished cars and parts, and the U.S. aims to reduce its trade deficit with Japan. FT

The Wall Street Journal reports that China posted higher-than-expected first quarter GDP growth of 6.4%, driven by stronger industrial production, retail sales, and property investment. China’s unexpectedly strong performance also reflects the government’s efforts to stimulate the economy through targeted stimulus, tax cuts, and red-tape reductions. WSJ

U.S. Economic Indicators

Industrial production fell 0.1% in March (up 2.8% Y/Y), after rising 0.1% (revised) in February. Capacity utilization edged down 0.2 point to 78.8 in March. Fed Report

The NAHB Housing Market Index rose 1.0 point to 63.0 in April. Improved builder confidence reflects solid demand for new single-family homes, tempered by affordability concerns due to supply-side headwinds including chronic shortages of workers and buildable lots. NAHB Report

U.S. News

The Financial Times reports that the European Union is seeking a rapid deal with the U.S. to slash tariffs on industrial goods by November 1 of this year. The two sides have yet to agree on the scope of the negotiations as the E.U. pushes back against U.S. pressure for a deal that includes greater export opportunities for U.S. farmers. FT

According to the Wall Street Journal, Chicago Fed President Charles Evans stated that he expects one rate increase towards the fall of 2020 and another in 2021. He anticipates inflation rising toward the Fed’s 2.0% target this year and believes the Fed should allow inflation to overshoot the target to compensate for running short of that goal. WSJ