Tom Moeller

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041231a.jpg" width="353">
Initial claims for unemployment insurance unexpectedly fell by 5,000 to 326,000 last week following a downwardly revised 15,000 rise the week prior. Consensus expectations had been for 335,000 claims.
The four week moving average of initial claims fell to 333,500 (-7.9% y/y).
During the last ten years there has been a (negative) 82% correlation between the level of initial claims and the y/y change in payroll employment.
Continuing claims for unemployment insurance jumped 29,000 but have drifted sideways for the last several weeks.
The insured rate of unemployment remained at 2.2%, where it&#39;s been since early October.
&quot;The Economy Gets Back on Track but Once Again Leaves Many Workers Behind&quot; from the Federal Reserve Bank of St. Louis is available <a href="http://stlouisfed.org/publications/re/2004/a/pages/econ_track.html"> here</a>.

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<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/WEEKLY/@W5/@W507/@W507.HTM">Unemployment Insurance (000s)</a></th>
<th scope="col">12/25/04</th>
<th scope="col">12/18/04</th>
<th scope="col">Y/Y</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
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<td class="firstcol">Initial Claims</td>
<td>326</td>
<td>331</td>
<td>-6.6%</td>
<td>402</td>
<td>404</td>
<td>406</td>
</tr>
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<td class="firstcol">Continuing Claims</td>
<td>--</td>
<td>2,755</td>
<td>-16.9%</td>
<td>3,531</td>
<td>3,570</td>
<td>3,018</td>
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Initial claims for unemployment insurance unexpectedly fell by 5,000 to 326,000 last week following a downwardly revised 15,000 rise the week prior. Consensus expectations had been for 335,000 claims. The four week moving average of [...]

Initial Claims For Jobless Insurance Fell

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Real GDP grew 1.6% (SAAR) in Q1’24 in this advance estimate, following a 3.4% gain in Q4’23 and a 4.9% Q3’23 rise. A 2.4% increase had been expected in the Action Economics Forecast Survey. Real GDP grew 3.0% on a Q1/Q1 basis after a 3.1% rise in 2023 and a 0.7% gain in 2022.

The growth slowdown last quarter stemmed from reduced contributions to growth from the change in business inventories and international trade. Inventories subtracted 0.35 percentage point from growth last quarter following a 0.47 point subtraction in Q. Net exports subtracted 0.86 percentage point after adding 0.25 percentage point in Q4. Exports grew 0.9% (0.3% y/y) which followed a 5.0% Q4 rise. Imports strengthened 7.2% (1.3% y/y) after rising 2.2% in Q4.

Growth in real final sales to domestic purchasers of 2.8% (2.9% y/y) followed two quarters of 3.5% gain. Personal consumption expenditures rose 2.5% (2.4% y/y) after a 3.3% increase in Q4, adding 1.7 percentage points to Q1 growth.

Durable goods spending declined 1.2% (+2.0% y/y) last quarter following a 3.2% gain. Motor vehicle expenditures fell 9.0% (-5.3% y/y) after declining 1.7%. Furniture & appliance buying rose 4.0% (2.8% y/y) after a 1.7% gain in Q4. Recreational goods & vehicle purchases fell 1.5% (+8.3% y/y) after strengthening 7.5% in Q4.

Nondurable goods outlays held steady (+1.9% y/y), following 2.9% growth in Q4. Apparel outlays rose 5.3% (1.8% y/y) after a 3.4% increase while food & beverage spending rose 1.0% (1.2% y/y) following a 0.8% gain. Outlays on gasoline & other energy products declined 10.9% (+0.1% y/y) after rising 4.3% in Q4.

Spending on services increased 4.0% last quarter (2.6% y/y) after a 3.4% gain. Housing & utilities outlays rose 1.4% (1.3% y/y) after a 0.1% Q4 improvement. Health care purchases rose 5.5% (4.6% y/y) following a 7.8% increase. Transportation services outlays growth of 4.6% (3.3% y/y) was improved from a 4.2% Q4 rise. Restaurant & hotel accommodations fell 2.0% (+2.6% y/y) after gaining 6.5% in Q4, while growth in recreation outlays jumped 4.8% (2.2% y/y) after a 0.4% rise in Q4.

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Business fixed investment increased 2.9% (3.9% y/y) last quarter, following a 3.8% Q4 rise, but spending on nonresidential structures eased 0.1% (+9.4% y/y) after surging 10.9% in Q4. Equipment investment increased 2.1% (1.0% y/y) after falling 1.1%. Information processing investment strengthened 12.2% (+2.2% y/y) following an 11.4% rise, while industrial equipment outlays grew 17.8% (1.4% y/y), after holding steady. Transportation equipment spending offset these gains and weakened 25.6% (-1.3% y/y) about as they did in Q4. Investment in intellectual property products rose 5.4% (3.6% y/y), after a 4.3% rise.

Residential structures investment surged 13.9% (5.1% y/y) in Q1, adding to two consecutive quarters of firm increase.

Government spending increased 1.2% (3.7% y/y), accounting for 0.21 percentage points of GDP growth, after a 4.6% rise. Federal government spending eased 0.2% (+2.5% y/y) following a 2.4% increase. State & local government spending grew 2.0% (4.4% y/y), after a 6.0% Q4 rise.

The GDP price index rose 3.1% (2.5% y/y) last quarter after a 1.6% Q4 gain. The rise was double expectations for a 1.6% Q1 increase. The PCE price index increased 3.4% (2.6% y/y) after a 1.8% rise. The PCE price index excluding food and energy prices rose 3.7% (2.9% y/y) after increasing 2.0% for two straight quarters. The PCE goods price index fell 0.5% (-0.2% y/y) after falling 1.4% and services prices rose 5.4% (4.0% y/y), after a 3.4% rise. The services price index less energy & housing rose 5.1% (3.5% y/y) after a 2.6% rise.

The business fixed investment price index rose 1.4% (1.1% y/y) following a 2.0% rise. The residential investment price index increased 0.6% (2.1% y/y) following two quarters of roughly 4.0% gain. The government spending price index rose 3.8% (2.4% y/y) after rising 1.9% in the fourth quarter.

The GDP data can be found in Haver’s **USECON** and **USNA** databases. **USNA** contains virtually all of the Bureau of Economic Analysis detail in the national accounts. The Action Economics consensus estimates can be found in **AS1REPNA**.

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- Quarterly growth is slowest since mid-2022.
- Inventories & foreign trade subtract from growth.
- Domestic final demand gain moderates.
- Price index growth accelerates.

U.S. GDP Growth Weakens in Q1’24

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The Pending Home Sales Index from the National Association of Realtors increased 3.4% (0.1% y/y) to 78.2 after rising 1.6% to 75.6 in February. These gains followed a 4.7% January decline. Sales were 38.9% below the peak in August 2020. The index reflects sales contract signings.

The rise in March sales occurred as the average rate on a 30-year mortgage increased to an average 6.82% from 6.78% in February. This rate was well above a low of 2.68% averaged in December 2020.

Pending home sales increased in three out of four regions. Sales in the South surged 7.0% (-1.5% y/y) following a 1.1% February decline. Sales in the West jumped 6.8% (3.6% y/y) after falling 6.5% in February. Sales in the Northeast rose 2.7% (-0.3% y/y) in March after declining 0.3%. Moving lower, sales in the Midwest fell 4.3% (+1.3% y/y) in March after a 10.6% February improvement.

The pending home sales index measures sales at the time the contract for the purchase of an existing home is signed, similar to the Census Bureau's new home sales data. In contrast, the National Association of Realtors' existing home sales data are recorded when the sale is closed, which is usually a couple of months after the sales contract has been signed. In developing the pending home sales index, the NAR found that the level of monthly sales contract activity leads the level of closed existing home sales by about two months.

The series dates back to 2001 and are available in Haver's **PREALTOR** database. Weekly mortgage interest rates from the Mortgage Bankers Association can be found in the **WEEKLY** database.

- Increase is fourth in five months.
- Sales rise in most regions of the country.

U.S. Pending Home Sales Strengthen in March

Winnie Tapasanun

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The advance estimate of the U.S. international trade deficit in goods widened to $91.83 billion in March from $90.30 billion in February (revised from a $91.84 billion deficit initially reported on March 29), according to the U.S. Census Bureau. This was the third time in four months that the goods deficit had widened. The March deficit was the biggest since April 2023 and larger than a $81.91 billion shortfall in March 2023. A deficit of $91.0 billion for March had been expected by the Action Economics Forecast Survey. The deficit had reached a peak of $121.18 billion in March 2022. In Q1'24, the goods trade deficit widened to $272.70 billion, the largest since Q2'23, after rising to $264.19 billion in Q4'23. The goods trade deficit subtracted 0.68%-point to real GDP growth in Q1'24 after having added 0.31%-point in Q4'23.

Total exports fell 3.5% m/m (-2.1% y/y) in March, the first monthly fall since November, reversing a 2.9% gain in February. Exports had fallen 6.4% since a July 2022 high. The fall in exports in March reflected exports m/m drops of 9.4% (-1.9% y/y) in foods, feeds & beverages, 3.9% (-4.8% y/y) in industrial supplies & materials, 3.7% (+3.1% y/y) in capital goods excluding autos, and 1.8% (-5.1% y/y) in nonfood consumer goods excluding autos. Meanwhile, exports of automotive vehicles & parts were virtually unchanged (-2.2% y/y) in March after an 8.5% drop in February. To the upside, exports of other goods rose 2.4% (-4.1% y/y) in March following a 0.6% increase in February and two consecutive m/m declines.

Total imports decreased 1.7% m/m (+2.5% y/y) in March, the first monthly decline in four months, following a 1.8% increase in February. Imports had fallen 9.9% since a March 2022 high. The decrease in imports in March reflected imports m/m drops of 10.8% (+6.5% y/y) in automotive vehicles & parts, 3.6% (+5.1% y/y) in foods, feeds & beverages, 3.2% (-7.3% y/y) in industrial supplies & materials, 2.9% (-0.2% y/y) in other goods, and 0.4% (+6.9% y/y) in capital goods excluding autos. In contrast, imports of nonfood consumer goods excluding autos were the only end-use category with a monthly gain in March; they rose 4.7% (4.0% y/y), the third m/m rise in four months, on top of a 2.6% February rebound.

The advance international trade data can be found in Haver's **USECON** database. The expectation figure is from the Action Economics Forecast Survey, which is in **AS1REPNA**.

- Largest goods trade deficit since April ’23 and larger than expected.
- Exports drop 3.5% following three straight m/m rises.
- Imports decline 1.7%, the first m/m decrease since November.

U.S. Goods Trade Deficit Widens to $91.83 Billion in March

Sandy Batten

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Initial claims for unemployment insurance unexpectedly fell to 207,000 seasonally adjusted in the week ended April 20 with the 212,000 claims reported in the previous week unrevised. The Action Economics Forecast Survey expected the latest week to be 215,000. The four-week moving average of initial claims fell to 213,250 from 214,500 in the previous week. Since the middle of September 2023, weekly claims have been fluctuating between 194,000 and 228,000, indicating that the labor market remains historically tight.

Insured unemployment, also known as continued weeks claimed, was 1.781 million in the week ended April 13, the lowest reading since January 13 and down from 1.796 million in the prior week. The earlier week was revised down from 1.812 million reported previously. As with initial claims, continuing claims have hovered in a narrow range for an extended period—between 1.728 million and 1.829 million since May 2023.

The insured unemployment rate, that is, the amount of insured unemployment as a percentage of covered employment, was unchanged at 1.2% in the April 13 week. It has been at that level continually since March 11, 2023.

Unemployment insurance rates vary widely across individual states. In the week ended April 6, the highest rates were in New Jersey (2.72%), California (2.25%), Rhode Island (2.10%), Minnesota (2.05%) and Massachusetts (2.02%). The lowest rates were in Kansas (0.33%), Florida (0.37%), Alabama (0.41%), North Carolina (0.41%) and Virginia (0.41%). Among other notable states, Illinois (1.92%), New York (1.85%), Pennsylvania (1.71%), Texas (0.95%) and Ohio (0.87%). These state data are not seasonally adjusted.

Data on weekly unemployment claims are from the Department of Labor, not the Bureau of Labor Statistics. They begin in 1967 and are contained in Haver’s **WEEKLY** database and summarized monthly in **USECON**. Data for individual states are in **REGIONW** back to December 1986. The expectations figure is from the Action Economics Forecast Survey in the **AS1REPNA** database.

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- Lowest weekly filings since week of February 17.
- Continued claims fell to lowest level since January 13.


Initial Claims For Jobless Insurance Fell

Summary

Tom Moeller

More Economy in Brief

U.S. GDP Growth Weakens in Q1’24

U.S. Pending Home Sales Strengthen in March

U.S. Goods Trade Deficit Widens to $91.83 Billion in March

U.S. Jobless Claims Fell in April 20 Week

Unemployment Insurance (000s)	12/25/04	12/18/04	Y/Y	2003	2002	2001
Initial Claims	326	331	-6.6%	402	404	406
Continuing Claims	--	2,755	-16.9%	3,531	3,570	3,018