Monthly Archives: March 2012
Consumer Spending Up in February, Outpacing Income
Spending by American households accelerated in February, as personal consumption jumped 0.8% for the month, the best performance since July. But strong spending does not necessarily reflect a strengthening in fundamentals, as personal income increased by a more modest 0.2%; in fact, the personal saving rate declined to 3.7% in February, from 4.3% in January. [...]
Durable Goods Rise on Aircraft Orders, but Still Lackluster
Durable goods increased 2.2% in February only partially offsetting a 3.6% decline in January. Much of the increase was led by a rise in aircraft orders, which typically have a long lag time to completion. Non-defense capital goods orders, which more closely track actual business investment in the economy, increased a more moderate 1.5% in [...]
Bernanke Focuses on Employment in NABE Speech
Federal Reserve Chairman Ben Bernanle focused on the labor market in his remarks for the National Association for Business Economics (NABE). The key message is that employment has improved, but not enough to take down our guard.
New Home Market Remains in Doldrums
New single-family home sales dropped to a 313,000-unit rate in February from a downwardly revised 318,000 rate in January. This is despite unseasonably mild winter weather, which has boosted showroom traffic for builders in some unseasonably mild parts of the country. The primary problem is competition with the existing market, which is still a better [...]
Home Sales Fall, but Remain Higher vs. Last Year
Existing home sales fell 0.9% to a 4.59 million-unit annualized rate in February, after being revised up for the month of January. Sales remain higher, in the high single digits, from a year ago. Recent mortgage applications have been a disappointment, as they have fallen off in response to an increase in mortgage rates in [...]
Housing Starts Fall, Despite Ongoing Multi-Family Gains
Housing starts edged down slightly to 698,000 in February from 706,000 in January. Increases in multi-family construction (apartments), which are being driven by REITs and an influx of investors trying to cash in on the rise in rental rates and the drop in vacancies, were more than offset by another decline in single-family home construction. [...]
CPI up on Gas Prices; Industrial Production Weak
The Consumer Price Index (CPI) jumped 0.4% in February, its fastest pace since spring of 2011; 80% of that increase may be attributed to a rise in energy prices. The core CPI rose a more modest 0.1% on services inflation, which is particularly important in assessing overall inflation trends because medical costs are included; this [...]
Better than Consensus: PPI, Jobless Claims
Producer prices rose by 0.4% in February, driven by higher energy prices. Most of the increase is accounted for by a 4.3% jump in the price of gasoline and more expensive heating oil – and this taking into account the unseasonably warm winter. On an annual basis, producer prices rose by 3.3 percent, the smallest [...]
Fed Acknowledges Improvements in Economy, but Stands Pat on Policy
The Federal Open Market Committee (FOMC) voted to stand pat on their guidance that the central tendency of their forecasts continues to justify low, short-term interest rates until late-2014. The committee also reaffirmed its commitment to continue with its “Operation Twist,” replacing short-term debt on its balance sheet with longer-term Treasury instruments and continue to [...]
Retail Sales Rise on Mild Weather and Gas Prices
Retail sales increased 1.1% in February, after being revised up the prior month. Apparel, sporting goods retailers and home improvement stores did particularly well as consumers flocked to buy spring clothing, went outdoors and played a bit more, and continued to do repairs and upgrades to their homes, activities usually reserved for warmer weather. We [...]
Bloomberg asks Diane Swonk to explain Fed concern over unemployment
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