U.S. Mortgage Loan Applications Improve; Rates Reach November High

The Mortgage Bankers Association reported that its total Mortgage Market Volume Index rebounded 8.4% last week (4.3% y/y) following several weeks of decline. Purchase applications increased 9.7% (14.8% y/y). Applications to refinance gained 7.0% (-4.8% y/y).

The effective interest rate on a 15-year mortgage rose to 3.45%, its highest level since November. The effective rate on a 30-year fixed rate loan improved to 4.28%. The rate on a Jumbo 30-year loan also gained to 4.25%. For adjustable 5-year mortgages, the effective interest rate rose to 3.24% and remained up from April's low of 2.92%.

The average mortgage loan size improved to $266,700 (8.0% y/y). For purchases, it rose to $295,600 (7.0% y/y) and for refinancings it increased to $236,500 (6.7% y/y).

Applications for fixed interest rate loans increased 6.2% y/y, but adjustable rate loan applications declined 17.9% y/y.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver's SURVEYW database.

MBA Mortgage Applications (SA, 3/16/90=100)	06/05/15	05/29/15	05/22/15	Y/Y %	2014	2013	2012
Total Market Index	400.5	369.5	399.9	4.3	361.5	616.6	813.8
Purchase	214.3	195.4	201.5	14.8	172.1	197.5	187.8
Refinancing	1,455.2	1,360.3	1,537.8	-4.8	1,449.8	3,070.0	4,505.0
15-Year Mortgage Effective Interest Rate (%)	3.45	3.36	3.35	3.50 (6/14)	3.54	3.42	3.25

 

U.S. Quarterly Services Survey Produces Varying Results
by Tom Moeller  June 10, 2015

The Quarterly Services Survey is produced by the U.S. Census Bureau. It samples approximately 5,000 service businesses with paid employees. For Q1 2015, it indicated that Hospitals revenue grew 9.2% y/y, the largest gain amongst the broad categories in the tally. Revenue growth here was three times growth in the slowest grouping. It was followed by a 6.8% rise in revenues for Administrative & Support services. That was driven by an 8.9% gain in the Employment category which followed a 13.0% increase during all of 2014.

Revenues to support Professional, Scientific & Technical services increased 5.6%, up from gains of 4.1% and 2.0% in 2014 and 2013, respectively. Leading the growth in this category were the Accounting, Tax Preparation, Bookkeeping & Payroll work with a 9.1% rise over the last four quarters. That followed a 10.1% rise during all of last year. Revenues for the Information grouping increased a lessened 3.0%, although a 7.2% rise was realized by Software Publishers

The QSS data can be found in Haver's USECON database.

myCPI: Getting More Personal with Inflation from the Federal Reserve Bank of Atlanta can be found here http://macroblog.typepad.com/macroblog/2015/05/mycpi-getting-personal-with-inflation.htm

Quarterly Revenue for Service Firms (QSS) Y/Y %	Q1'15	Q4'14	Q3'14	2014	2013	2012
Hospitals	9.2	5.7	5.7	4.6	3.6	5.9
Administrative & Support	6.8	8.4	7.9	9.3	4.0	5.0
Employment	8.9	9.1	9.6	13.0	5.4	7.5
Other Administrative & Support	8.6	9.1	8.1	8.6	3.3	4.4
Waste Management	-5.2	2.9	3.1	3.7	2.0	0.6
Professional, Scientific & Technical	5.6	4.8	5.0	4.1	2.0	4.0
Legal	3.3	-0.9	2.5	1.3	-1.2	1.6
Accounting, Tax Preparation, Bookkeeping & Payroll	9.1	9.7	10.7	10.1	5.0	7.7
Information	3.0	4.4	4.7	5.2	3.4	4.2
Software Publishers	7.2	7.0	10.3	7.9	6.9	2.6

 

U.S. Budget Deficit Eases as Revenues Surge
by Tom Moeller  June 10, 2015

The Federal Government reported a $156.7 billion budget surplus during April compared to a $106.9 billion surplus during April of 2014. A $141.0 billion surplus had been expected in the Action Economics Forecast Survey. For the first seven months of Fiscal Year 2015, the deficit eased to $282.8 billion compared to a $306.4 billion deficit in the first seven months of FY 2014. Projections from the Congressional Budget Office call for a budget deficit of $486 billion in FY 2015 compared to $483.4 billion last year, then a $455 billion deficit in FY 20016.

The easing of the budget deficit so far this fiscal year versus FY'14 occurred as April revenues surged 13.9% y/y, pulling overall fiscal year-to-date receipts up 8.9% y/y. Individual income taxes jumped 21.0% y/y in April pulling the Fiscal YTD total up 12.9% y/y. Earlier this year, y/y gains were running in the high single digits. Growth in corporate income taxes remained strong at 11.8% y/y. Improved labor markets left social insurance taxes & contributions growing 3.7% y/y while excise taxes slipped 0.6% y/y.

The pickup in government receipts occurred none-to-soon as outlay growth so far this fiscal year was a firm 6.4% y/y, despite a 3.0% decline in defense outlays. Spending on health programs accelerated to 20.5% y/y with the Patient Protection and Affordable Care Act. Education, Training, Employment & Social Services spending growth also accelerated to 21.5% y/y. Medicare spending growth strengthened to 8.2% y/y. Veterans benefits growth diminished to 5.4% y/y while Social Security payments growth was fairly steady at 4.4%. Interest payments declined 7.1% following a 3.9% drop one year earlier.

Haver's basic data on Federal Government outlays and receipts are contained in USECON. Considerable detail is given in the separate GOVFIN database. The Action Economics Forecast Survey numbers are in the AS1REPNA database.

US Government Finance		May	FY'14	FY'13	FY'12	FY'11
Budget Balance	--	$-82.4 bil.	$-483.4 bil.	$-680.2 bil.	$-1,089.2 bil.	$-1,296.8 bil.
As a percent of GDP	--	--	2.8	4.1	6.8	8.4
	% of Total	FY'15 YTD
Net Revenues (Y/Y % Change)	100	8.6%	8.9%	13.3%	6.4%	6.5%
Individual Income Taxes	47	12.4	5.9	16.3	3.7	21.5
Corporate Income Taxes	10	10.8	17.3	12.9	33.8	-5.4
Social Insurance Taxes	34	3.7	8.0	12.1	3.2	-5.3
Excise Taxes	3	2.8	11.1	6.3	9.2	8.2
Net Outlays (Y/Y % Change)	100	4.0	1.4	-2.4	-1.7	4.1
National Defense	18	-3.3	-4.7	-6.3	-3.9	1.7
Health	10	18.9	14.2	3.1	-7.0	1.0
Medicare	14	2.8	2.8	5.5	-2.8	7.5
Income Security	16	-3.9	-4.3	-1.1	-9.1	-4.1
Social Security	24	4.4	4.6	5.2	5.8	3.4
Veterans Benefits & Services	4	0.1	7.7	11.5	-2.0	17.3
Education, Training, Employment & Social Services	3	18.1	25.9	-21.9	-10.3	-20.6
Interest	6	-5.7	3.0	0.4	-3.0	15.8