Tom Moeller

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302c.jpg" width="353">
Initial unemployment insurance claims last week reversed most of the prior week&#39;s revised decline and rose 15,000 to 294,000. Consensus expectations had been for 285,000 claims.
During the last ten years there has been a (negative) 75% correlation between the level of initial jobless insurance claims and the m/m change in payroll employment.
The four-week moving average of initial claims rose to 287,250 (-6.5% y/y).
Continuing unemployment insurance claims fell 2,000 following the prior week&#39;s revised 16,000 decline which compared to a rise estimated initially.
The insured rate of unemployment was stable at 1.9% for the third week.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<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">02/25/06</th>
<th scope="col">02/18/06</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Initial Claims</td>
<td>294</td>
<td>279</td>
<td>-7.0%</td>
<td>332</td>
<td>343</td>
<td>402</td>
</tr>
<tr>
<td class="firstcol">Continuing Claims</td>
<td>--</td>
<td>2,486</td>
<td>-6.8%</td>
<td>2,663</td>
<td>2,924</td>
<td>3,532</td>
</tr>
</tbody>
</table>
</body>
</html>

Initial unemployment insurance claims last week reversed most of the prior week's revised decline and rose 15,000 to 294,000. Consensus expectations had been for 285,000 claims. During the last ten years there has been a (negative) [...]

Initial Unemployment Insurance Claims Ticked Higher

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302d.jpg" width="353">
Challenger, Grey &amp; Christmas reported that job cut announcements during February fell 15.5% (-19.3% y/y) to 87,437, the lowest level since October.
Layoffs in the auto industry fell sharply from the heated January pace but still were more than double the prior February&#39;s level. Announced job cuts in government rose 11.6% to a level more than double the prior February while layoffs in the financial industry surged m/m to a level more than double the prior year.
During the last ten years there has been an 84% (inverse) correlation between the three month moving average of announced job cuts and the three month change payroll employment.
Job cut announcements differ from layoffs. Many are achieved through attrition, early retirement or just never occur.
Challenger also reported the third consecutive m/m drop in announced hiring plans (-69.2% y/y).

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/SURVEYS/@S3/@S301/@S301.HTM">Challenger, Gray &amp; Christmas</a></th>
<th scope="col">Feb</th>
<th scope="col">Jan</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Announced Job Cuts</td>
<td>87,437</td>
<td>103,466</td>
<td>-19.3%</td>
<td>1,072,054</td>
<td>1,039,935</td>
<td>1,236,426</td>
</tr>
</tbody>
</table>
</body>
</html>

Challenger, Grey & Christmas reported that job cut announcements during February fell 15.5% (-19.3% y/y) to 87,437, the lowest level since October. Layoffs in the auto industry fell sharply from the heated January pace but still were [...]

Challenger Layoffs Down Sharply

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302b.jpg" width="353">
Warm temperatures in January did little for the value of construction put in place which increased just 0.2%. Consensus expectations had been for a 1.1% gain but the firm 1.0% advance in December was unrevised.
Residential building rose only 0.1 following a downwardly revised 0.9% December increase. New single family building inched up just 0.1% (13.2% y/y) while the value of improvements rose 0.2% (-10.6% y/y). The value of new multi-family residential construction fell 0.5% (+12.4% y/y).
Nonresidential building added 0.5% to a downwardly revised 1.1% December increase. Office construction slipped 0.2% (+8.9% y/y) and commercial building rose 0.4% (+9.5% y/y). These y/y gains pale when compared to multi-retail commercial which rose 7.9% in January (40.0% y/y).
Public construction spending rose 0.2% following an upwardly revised 1.3% December increase. Construction activity on highways &amp; streets, nearly one third of the value of public construction spending, recovered the prior month&#39;s decline and rose 0.9% (12.7% y/y).
These more detailed categories represent the Census Bureau&#146;s reclassification of construction activity into end-use groups. Finer detail is available for many of the categories; for instance, commercial construction is shown for Automotive sales and parking facilities, drugstores, building supply stores, and both commercial warehouses and mini-storage facilities. Note that start dates vary for some seasonally adjusted line items in 2000 and 2002 and that constant-dollar data are no longer computed.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@E9/@E907/@E90701/@E90701.HTM">Construction Put-in-place</a></th>
<th scope="col">Jan</th>
<th scope="col">Dec</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Total</td>
<td>0.2%</td>
<td>1.0%</td>
<td>7.4%</td>
<td>9.1%</td>
<td>10.9%</td>
<td>5.4%</td>
</tr>
<tr>
<td class="firstcol">Private</td>
<td>0.2%</td>
<td>0.9%</td>
<td>6.3%</td>
<td>9.6%</td>
<td>13.6%</td>
<td>6.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Residential</td>
<td>0.1%</td>
<td>0.9%</td>
<td>6.5%</td>
<td>11.4%</td>
<td>18.2%</td>
<td>12.9%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Nonresidential</td>
<td>0.5%</td>
<td>1.1%</td>
<td>5.6%</td>
<td>5.2%</td>
<td>3.9%</td>
<td>-5.4%</td>
</tr>
<tr class="odd">
<td class="firstcol">Public</td>
<td>0.2%</td>
<td>1.3%</td>
<td>11.3%</td>
<td>7.6%</td>
<td>2.5%</td>
<td>2.7%</td>
</tr>
</tbody>
</table>
</body>
</html>

Warm temperatures in January did little for the value of construction put in place which increased just 0.2%. Consensus expectations had been for a 1.1% gain but the firm 1.0% advance in December was unrevised. Residential building [...]

U.S. Construction Increase Light

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302a.jpg" width="353">
US light vehicle sales in February retraced all of the January gain and fell 5.8% to 16.61M units, the lowest level since November according to the Autodata Corporation. The decline about matched Consensus expectations for a 16.5M sales rate last month.
The sharp decline in February sales resulted from a 21.1% m/m drop (-0.5% y/y) in US made car sales. It fully retraced the prior month&#39;s rise which occurred as automakers &quot;restocked&quot; rental fleets.
A 1.1% (1.2% y/y) rise in sales of domestic trucks recovered a portion of the prior month&#39;s sharp drop.
Imported car sales in February recovered most of the prior month&#39;s drop and increased 13.5% (1.3% y/y) to 2.17M units while imported truck sales rose a steady 2.6% (7.8% y/y) to a record high of 1.32M units.
Imports&#39; share of the US light vehicle market recovered to 21.0% from the depressed 18.1% during January. Imports&#39; share during all of last year was 20.3%.
Variations in consumer sentiment across demographic groups from the Federal Reserve Bank of Chicago can be found <a href="http://www.chicagofed.org/publications/economicperspectives/ep_1qtr2006_part2_toussaint_et_al.pdf"> here</a>. 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@ED/@ED09/@ED0901/@ED0901.HTM">Light Vehicle Sales (SAAR, Mil. Units)</a></th>
<th scope="col">Feb</th>
<th scope="col">Jan</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Total</td>
<td>16.61</td>
<td>17.64</td>
<td>1.2%</td>
<td>16.92</td>
<td>16.87</td>
<td>16.63</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Autos</td>
<td>7.42</td>
<td>8.56</td>
<td>0.1%</td>
<td>7.65</td>
<td>7.49</td>
<td>7.62</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Trucks</td>
<td>9.20</td>
<td>9.08</td>
<td>2.1%</td>
<td>9.27</td>
<td>9.37</td>
<td>9.01</td>
</tr>
</tbody>
</table>
</body>
</html>

US light vehicle sales in February retraced all of the January gain and fell 5.8% to 16.61M units, the lowest level since November according to the Autodata Corporation. The decline about matched Consensus expectations for a 16.5M [...]

U.S. Vehicle Sales Down in February

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302a.jpg" width="353">
US light vehicle sales in February retraced all of the January gain and fell 5.8% to 16.61M units, the lowest level since November according to the Autodata Corporation. The decline about matched Consensus expectations for a 16.5M sales rate last month.
The sharp decline in February sales resulted from a 21.1% m/m drop (-0.5% y/y) in US made car sales. It fully retraced the prior month&#39;s rise which occurred as automakers &quot;restocked&quot; rental fleets.
A 1.1% (1.2% y/y) rise in sales of domestic trucks recovered a portion of the prior month&#39;s sharp drop.
Imported car sales in February recovered most of the prior month&#39;s drop and increased 13.5% (1.3% y/y) to 2.17M units while imported truck sales rose a steady 2.6% (7.8% y/y) to a record high of 1.32M units.
Imports&#39; share of the US light vehicle market recovered to 21.0% from the depressed 18.1% during January. Imports&#39; share during all of last year was 20.3%.
Variations in consumer sentiment across demographic groups from the Federal Reserve Bank of Chicago can be found <a href="http://www.chicagofed.org/publications/economicperspectives/ep_1qtr2006_part2_toussaint_et_al.pdf"> here</a>. 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@ED/@ED09/@ED0901/@ED0901.HTM">Light Vehicle Sales (SAAR, Mil. Units)</a></th>
<th scope="col">Feb</th>
<th scope="col">Jan</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Total</td>
<td>16.61</td>
<td>17.64</td>
<td>1.2%</td>
<td>16.92</td>
<td>16.87</td>
<td>16.63</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Autos</td>
<td>7.42</td>
<td>8.56</td>
<td>0.1%</td>
<td>7.65</td>
<td>7.49</td>
<td>7.62</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Trucks</td>
<td>9.20</td>
<td>9.08</td>
<td>2.1%</td>
<td>9.27</td>
<td>9.37</td>
<td>9.01</td>
</tr>
</tbody>
</table>
U.S. Construction Increase Light  
by <a href="/comment/Moeller.html">Tom Moeller</a>  March 2, 2006


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302b.jpg" width="353">
Warm temperatures in January did little for the value of construction put in place which increased just 0.2%. Consensus expectations had been for a 1.1% gain but the firm 1.0% advance in December was unrevised.
Residential building rose only 0.1 following a downwardly revised 0.9% December increase. New single family building inched up just 0.1% (13.2% y/y) while the value of improvements rose 0.2% (-10.6% y/y). The value of new multi-family residential construction fell 0.5% (+12.4% y/y).
Nonresidential building added 0.5% to a downwardly revised 1.1% December increase. Office construction slipped 0.2% (+8.9% y/y) and commercial building rose 0.4% (+9.5% y/y). These y/y gains pale when compared to multi-retail commercial which rose 7.9% in January (40.0% y/y).
Public construction spending rose 0.2% following an upwardly revised 1.3% December increase. Construction activity on highways &amp; streets, nearly one third of the value of public construction spending, recovered the prior month&#39;s decline and rose 0.9% (12.7% y/y).
These more detailed categories represent the Census Bureau&#146;s reclassification of construction activity into end-use groups. Finer detail is available for many of the categories; for instance, commercial construction is shown for Automotive sales and parking facilities, drugstores, building supply stores, and both commercial warehouses and mini-storage facilities. Note that start dates vary for some seasonally adjusted line items in 2000 and 2002 and that constant-dollar data are no longer computed.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@E9/@E907/@E90701/@E90701.HTM">Construction Put-in-place</a></th>
<th scope="col">Jan</th>
<th scope="col">Dec</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Total</td>
<td>0.2%</td>
<td>1.0%</td>
<td>7.4%</td>
<td>9.1%</td>
<td>10.9%</td>
<td>5.4%</td>
</tr>
<tr>
<td class="firstcol">Private</td>
<td>0.2%</td>
<td>0.9%</td>
<td>6.3%</td>
<td>9.6%</td>
<td>13.6%</td>
<td>6.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Residential</td>
<td>0.1%</td>
<td>0.9%</td>
<td>6.5%</td>
<td>11.4%</td>
<td>18.2%</td>
<td>12.9%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Nonresidential</td>
<td>0.5%</td>
<td>1.1%</td>
<td>5.6%</td>
<td>5.2%</td>
<td>3.9%</td>
<td>-5.4%</td>
</tr>
<tr class="odd">
<td class="firstcol">Public</td>
<td>0.2%</td>
<td>1.3%</td>
<td>11.3%</td>
<td>7.6%</td>
<td>2.5%</td>
<td>2.7%</td>
</tr>
</tbody>
</table>
Challenger Layoffs Down Sharply 
by <a href="/comment/Moeller.html">Tom Moeller</a> March 2, 2006


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302d.jpg" width="353">
Challenger, Grey &amp; Christmas reported that job cut announcements during February fell 15.5% (-19.3% y/y) to 87,437, the lowest level since October.
Layoffs in the auto industry fell sharply from the heated January pace but still were more than double the prior February&#39;s level. Announced job cuts in government rose 11.6% to a level more than double the prior February while layoffs in the financial industry surged m/m to a level more than double the prior year.
During the last ten years there has been an 84% (inverse) correlation between the three month moving average of announced job cuts and the three month change payroll employment.
Job cut announcements differ from layoffs. Many are achieved through attrition, early retirement or just never occur.
Challenger also reported the third consecutive m/m drop in announced hiring plans (-69.2% y/y).

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/SURVEYS/@S3/@S301/@S301.HTM">Challenger, Gray &amp; Christmas</a></th>
<th scope="col">Feb</th>
<th scope="col">Jan</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Announced Job Cuts</td>
<td>87,437</td>
<td>103,466</td>
<td>-19.3%</td>
<td>1,072,054</td>
<td>1,039,935</td>
<td>1,236,426</td>
</tr>
</tbody>
</table>
Initial Unemployment Insurance Claims Ticked Higher 
by <a href="/comment/Moeller.html">Tom Moeller</a> March 2, 2006


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302c.jpg" width="353">
Initial unemployment insurance claims last week reversed most of the prior week&#39;s revised decline and rose 15,000 to 294,000. Consensus expectations had been for 285,000 claims.
During the last ten years there has been a (negative) 75% correlation between the level of initial jobless insurance claims and the m/m change in payroll employment.
The four-week moving average of initial claims rose to 287,250 (-6.5% y/y).
Continuing unemployment insurance claims fell 2,000 following the prior week&#39;s revised 16,000 decline which compared to a rise estimated initially.
The insured rate of unemployment was stable at 1.9% for the third week.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<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">02/25/06</th>
<th scope="col">02/18/06</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Initial Claims</td>
<td>294</td>
<td>279</td>
<td>-7.0%</td>
<td>332</td>
<td>343</td>
<td>402</td>
</tr>
<tr>
<td class="firstcol">Continuing Claims</td>
<td>--</td>
<td>2,486</td>
<td>-6.8%</td>
<td>2,663</td>
<td>2,924</td>
<td>3,532</td>
</tr>
</tbody>
</table>
January Retail Trade Gains in 4 Very Diverse Places 
by <a href="/comment/Stone.html">Carol Stone</a> March 2, 2006


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302e.jpg" width="353">
Four widely diverse areas reported retail trade today for January. Generally, these reports indicated some strength. In Hong Kong, for example, sales were up 11.6% over a year ago, extending a firmer performance into a second month. In a larger area, Germany&#39;s sales rebounded to a 2.2% year-on-year gain after being down in December. Australia and Estonia also had favorable sales increases in January.
The Hong Kong retail sales firmed noticeably for consumer electronics, and clothing had a modest increase, apparently picking up after a lull in late summer and autumn. Also in that region of the world, sales in Australia gained 4.2% from January 2005, with the food and hospitality sectors leading. Department stores and recreation good were both down from a year ago.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302f.jpg" width="353">
For Germany, only total sales are available in their initial release. However, notably, the improvement here corresponds to the improved sentiment of retail trade business executives reported in the Ifo survey. In detail Ifo data released Tuesday, the Business Climate Index for that sector was 96.0 in January, the third highest since 2001. Then for February, the index climbed more than 4 points to 100.7, its first reading above 100 since the base year of 2000. The correlation between year-to-year percent changes in this index and in actual retail sales is 0.44. Correlations of other Ifo indexes are even better; for instance, the total index is 0.53 and the index for consumer goods less food is 0.62. Thus, business executives of related production industries are at least as concerned about the performance in final sales as managers of the stores themselves.<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060302g.jpg" width="353">
Finally, retail sales gains were good in Estonia. The year-on-year pace in January was 23%, although this magnitude partly reflects a base effect in which January 2005 was quite weak. So, when we look at the seasonally adjusted data calculated by Haver Analytics, we see that the latest figure actually shows a small decrease from December&#39;s amount. Despite this modest setback, volume growth in Estonia has actually been quite strong, up 18.8% from a year ago and off just 0.4% from December. The last three months of 2005 averaged 2.5% month-to-month gains in the volume index. Thus, Estonian consumer demand appears quite buoyant. 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">Retail Trade, Yr/Yr % Changes</th>
<th scope="col">Jan 2006</th>
<th scope="col">Dec 2005</th>
<th scope="col">Nov 2005</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Hong Kong</td>
<td>11.6</td>
<td>6.8</td>
<td>4.2</td>
<td>6.8</td>
<td>10.8</td>
<td>-2.3</td>
</tr>
<tr>
<td class="firstcol">Australia</td>
<td>4.2</td>
<td>3.9</td>
<td>3.8</td>
<td>2.8</td>
<td>7.2</td>
<td>6.8</td>
</tr>
<tr class="odd">
<td class="firstcol">Germany</td>
<td>2.2</td>
<td>-0.5</td>
<td>1.1</td>
<td>1.5</td>
<td>2.0</td>
<td>-0.5</td>
</tr>
<tr>
<td class="firstcol">Estonia</td>
<td>23.0</td>
<td>16.4</td>
<td>14.9</td>
<td>12.4</td>
<td>15.5</td>
<td>9.5</td>
</tr>
</tbody>
</table>
</body>
</html>

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060301f.jpg" width="353">
According to the Office of Federal Housing Enterprise Oversight (OFHEO), U.S. home prices rose last quarter at roughly the same rate as during the prior two years. The 2.9% q/q rise certainly was down from the upwardly revised 3.1% gain during the prior quarter and was down from a 4.6% quarterly jump during 3Q04, but the 4Q/4Q gain of 13.0% was near the series&#39; peak. For all of 2005, the 13.2% rate of appreciation set a new record.
The House Price Indices in this report are weighted indexes based on repeat sales or refinancings using data provided by Fannie Mae or Freddie Mac.
Monday&#39;s report that median prices for new homes sold last year rose just 7.0%, roughly half the 2004 rate of growth, may suggest that fewer large expensive homes were sold during 2005 than during the prior year.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060301g.jpg" width="353">
While rates of home price appreciation appear to have topped throughout the country, they have been steady. Moreover, the variance in the rates of growth between regions remained high.
During the last year, job cutbacks in the auto industry helped lower the 4Q/4Q rate of home price appreciation in Michigan to 3.8% and the state&#39;s gain has lagged all others. Conversely, California home prices logged a strong 4Q05 gain of 4.6% (21.1% y/y) while demographic trends raised Arizona home prices by 34.9% 4Q/4Q and Florida home prices by 26.8%.
During the last five years, home price appreciation in the District of Columbia surpassed all others at 16.9% per year followed closely by California at 16.2% per annum. Indiana at 3.8%, Nebraska at 4.2% and Michigan at 4.5% are at the bottom of the list. New Jersey (12.7%), New York ((11.5%) and Massachusetts (11.1%) ranked high but just behind Hawaii at 14.6% home price appreciation averaged during the last five years.
The latest report from the Office of Federal Housing Enterprise Oversight (OFHEO) can be found <a href="http://www.ofheo.gov/media/pdf/4q05hpi.pdf">here</a>.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/REGIONAL/@R11/@R1101/@R1101.HTM">House Price Index (OFHEO)</a></th>
<th scope="col">4Q &#39;05</th>
<th scope="col">3Q &#39;05</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">United States</td>
<td>2.9%</td>
<td>3.1%</td>
<td>13.0%</td>
<td>13.2%</td>
<td>10.8%</td>
<td>6.8%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; California</td>
<td>4.6%</td>
<td>4.6%</td>
<td>21.1%</td>
<td>23.3%</td>
<td>22.3%</td>
<td>12.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; New Jersey</td>
<td>3.5%</td>
<td>3.7%</td>
<td>15.6%</td>
<td>16.2%</td>
<td>15.0%</td>
<td>10.5%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Alabama</td>
<td>2.5%</td>
<td>2.1%</td>
<td>9.2%</td>
<td>7.9%</td>
<td>4.1%</td>
<td>4.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Michigan</td>
<td>0.7%</td>
<td>0.9%</td>
<td>3.8%</td>
<td>4.5%</td>
<td>4.4%</td>
<td>3.4%</td>
</tr>
</tbody>
</table>
</body>
</html>

According to the Office of Federal Housing Enterprise Oversight (OFHEO), U.S. home prices rose last quarter at roughly the same rate as during the prior two years. The 2.9% q/q rise certainly was down from the upwardly revised 3.1% [...]

Rumors of Home Prices' Demise Exaggerated

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060301e.jpg" width="353">
The total number of mortgage applications dropped 1.2% last week, the fourth sharp decline in the last five weeks. The average level of applications during February fell 6.3% from the prior month.
Purchase applications dropped 1.9% from the prior week and the February average fell 10.2% from January. The latest level is down nearly one quarter from the high last Spring.
During the last ten years there has been a 50% correlation between the y/y change in purchase applications and the change in new plus existing single family home sales.
Applications to refinance ticked up 0.1% w/w but the February average fell 2.0% from January.
The effective interest rate on a conventional 30-year mortgage slipped to 6.42% and averaged 6.48% during February versus 6.34% in January. The effective rate on a 15-year mortgage also slipped to 6.15% and averaged 6.16% during February versus 5.98% in January. Interest rates on 15 and 30 year mortgages are closely correlated (&gt;90%) with the rate on 10 year Treasury securities and during the last ten years there has been a (negative) 82% correlation between purchase applications and the effective rate on a 30-Year mortgage.
The Mortgage Bankers Association surveys between 20 to 35 of the top lenders in the U.S. housing industry to derive its refinance, purchase and market indexes. The weekly survey accounts for more than 40% of all applications processed each week by mortgage lenders. Visit the Mortgage Bankers Association site <a href="http://www.mbaa.org">here</a>.
Are Banks Vulnerable to a Housing Bust? from the Federal Reserve Bank of St. Louis is available <a href="http://research.stlouisfed.org/publications/mt/20060201/cover.pdf"> here</a>.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/SURVEYW/@S5/@S5.HTM">MBA Mortgage Applications (3/16/90=100)</a></th>
<th scope="col">02/24/06</th>
<th scope="col">02/17/06</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Total Market Index</td>
<td>571.5</td>
<td>578.5</td>
<td>-19.5%</td>
<td>708.6</td>
<td>735.1</td>
<td>1,067.9</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Purchase</td>
<td>400.8</td>
<td>408.7</td>
<td>-8.9%</td>
<td>470.9</td>
<td>454.5</td>
<td>395.1</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Refinancing</td>
<td>1,573.5</td>
<td>1,571.4</td>
<td>-31.0%</td>
<td>2,092.3</td>
<td>2,366.8</td>
<td>4,981.8</td>
</tr>
</tbody>
</table>
</body>
</html>

The total number of mortgage applications dropped 1.2% last week, the fourth sharp decline in the last five weeks. The average level of applications during February fell 6.3% from the prior month. Purchase applications dropped 1.9% [...]

Mortgage Applications Off Sharply

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>

 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/060301d.jpg" width="353">
Chain store sales surged 1.5% during the last week of February after a 0.2% up tick the prior week, according to the International Council of Shopping Centers (ICSC)-UBS survey.
Strength early and late in the month lifted the average of February sales 0.8% ahead of the January average which rose 1.0% from December.
The leading indicator of chain store sales rose for the first time in four weeks, but the weak 0.1% left the February average 0.5% below January.
The ICSC-UBS retail chain-store sales index is constructed using the same-store sales (stores open for one year) reported by 78 stores of seven retailers: Dayton Hudson, Federated, Kmart, May, J.C. Penney, Sears and Wal-Mart.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/surveyw/@S2/@S2.HTM">ICSC-UBS (SA, 1977=100)</a></th>
<th scope="col">02/25/06</th>
<th scope="col">02/18/06</th>
<th scope="col">Y/Y</th>
<th scope="col">2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Total Weekly Chain Store Sales</td>
<td>469.0</td>
<td>461.9</td>
<td>3.6%</td>
<td>3.6%</td>
<td>4.7%</td>
<td>2.9%</td>
</tr>
</tbody>
</table>


</html>

Chain store sales surged 1.5% during the last week of February after a 0.2% up tick the prior week, according to the International Council of Shopping Centers (ICSC)-UBS survey. Strength early and late in the month lifted the average [...]

Chain Store Sales Surged

Even with expected tariff-induced increases in inflation, BCFF forecasters look for a more aggressive round of monetary easing

USD/EUR exchange rate uncoupling from interest rate differential

Widespread downgrading of 2025 GDP outlook

Trade and fiscal policy uncertainty has exploded with the new administration

Much lower US electricity costs gives it a competitive advantage

Wage growth slowing in the US and Euro area; elevated and sticky in the UK

Stagflation-lite: Blue Chip forecasts below-trend growth and elevated inflation

US policy gyrations boosting policy uncertainty worldwide

Expected tariff hikes have boosted inflation expectations

US and Japan ended 2024 on solid ground in contrast to Europe

US economy expected to outperform other major economies in 2025

Only modest evidence of AI-related surge in US productivity growth

Previous Trump tariffs fading. A boost from new tariffs ahead?

Heavy US manufacturing states underperforming while Sun Belt states outperforming

Rising long-term yields a global phenomenon

US financial market concerns shifting from growth to inflation

Economic activity is picking up in the US but remains lackluster abroad

Policy uncertainty has surged since the US national elections.

Recent turnaround in US economic surprises leading to increases in rate-cut expectations

The outlook has brightened in the US, while it has dimmed for other major economies

Headline US PCE inflation elevated by sticky services prices

US and global equity prices have recently diverged

US leading global upturn in economic surprises

Blue Chip forecasters look for further significant monetary easing apart from Japan

Recent rise in global supply chain pressures could augur a pickup in global inflation pressures

Our global data offering is unparalleled in terms of coverage, quality, and organization. We offer 290+ databases from 2500 government and private sources, a wealth of key survey and forecast data covering the world’s economies, and a robust offering of archive databases that drive machine learning for big data applications.

Optimized for precision analytics, our data is seamlessly integrated with Microsoft Office and all leading statistical packages through our DLX® software and platform independent HaverView™ website. We further offer direct database feeds, client server or cloud-based delivery, and RESTful API.


Privacy Policy

Disclaimer

Contact us

A premier time series data platform for the global strategy, research, and quant communities. 

New York

London

Singapore

Tokyo

Economy in Brief

Viewpoints

Contact Us

Our Data

Our Products

What We Do

Our Authors

About Us

Data News

Resources

Release Calendars

Training Center

Webinars

Newsletters

Download Software

For Clients

Live Updates

Andrew Cates

**The global business cycle** 
The recent sharp decline in the Future Output Balance in the global composite PMI survey reflects a sudden deterioration in global business expectations. The sweeping tariffs, introduced in April 2025, have generated heightened uncertainty around trade policy and sparked fears of retaliatory actions from key trading partners. As a result, businesses worldwide are scaling back their expectations for future output, wary of rising costs, disrupted demand flows, and a broader shift toward protectionism that could undermine global economic momentum.

250507Z1.jpg

Note: The extreme declines in the Future Output Balance that were recorded in the early months of 2020 (at the height of the COVID pandemic) have been removed from this chart.

**Global supply chain pressures**
Still, despite the marked deterioration in global business expectations, this second chart below provides a reassuring counterpoint: as of now, there is little evidence that global supply chain pressures have materially intensified. Both the New York Fed’s Global Supply Chain Pressure Index and the Baltic Exchange Dry Index remain relatively subdued, especially compared to the pandemic-era spikes of 2020–2022. While there has been heightened concern following the April 2025 US tariff announcements, these trade policy shifts have yet to translate into measurable physical disruption in logistics or freight rates. The stability of these indices suggests that although sentiment has taken a hit, global shipping networks and supply flows are, for now, absorbing the shock. However, this calm may prove fragile if the policy environment hardens further or retaliatory trade actions begin to compound the strain.

250507Z2.jpg

**Expectations for central banks’ policy rates** 
Adding to the picture of mounting economic caution, the latest Blue Chip Financial Forecasts survey reveals that expectations for policy easing over the next 12 months have become even more pronounced than in previous months. While earlier surveys had already pointed to a further extension of the global rate-cutting cycle, the latest results suggest forecasters now anticipate a deeper and more aggressive round of monetary easing—most notably from the US Federal Reserve, which is now expected to deliver nearly a full percentage point in rate cuts over the next 12 months. The sharp deterioration in business sentiment is reshaping the macro narrative: central banks are no longer simply guiding inflation lower, but are instead preparing to confront the risk of a deeper, demand-driven slowdown.

250507Z3.jpg

**Energy prices and inflation** 
Adding further context to the growing expectations for policy easing, oil prices have dropped sharply in recent weeks—driven by mounting concerns over global growth, as reflected in weakening business sentiment and softer demand indicators. The chart below provides a longer-run perspective on why this matters: energy prices have historically played a central role in shaping the global inflation trajectory. The strong positive correlation (r = 0.83) between median world energy price inflation and median core consumer price inflation underscores the powerful pass-through effects energy costs can have on broader price dynamics. While core inflation tends to be stickier, this historical relationship makes clear that sustained declines in energy prices often foreshadow broader disinflationary trends.

250507Z4.jpg

**Intangibles versus tangibles** 
Shifting focus from short-term cyclical risks to longer-term structural dynamics, the next chart below underscores a fundamental transformation in the composition of US investment: the economy has increasingly been built on intangibles. Over the past several decades, investment in intangible assets—such as software, intellectual property, R&D, and brand equity—has steadily climbed and, since the mid-2010s, has overtaken investment in both structures and equipment as a share of GDP. This shift reflects the rise of a knowledge-based, innovation-driven economy, but it also introduces new forms of vulnerability. Unlike physical capital, intangible assets rely heavily on trust, reputation, legal protections, and global openness. In this context, escalating trade frictions and a more confrontational US economic stance—as signalled by the recent tariff wave—risk eroding the goodwill and institutional credibility that underpin much of the value created by intangibles. If geopolitical uncertainty undermines the perceived reliability of US intellectual property protections or weakens global collaboration, it could pose a deeper structural challenge to future growth than any immediate cyclical downturn.

250507Z5.jpg

**Investment in Artificial Intelligence**
The centrality of intangibles to the US growth model is nowhere more evident than in the explosion of private investment in artificial intelligence. As this chart illustrates, global AI investment has surged over the past decade—reaching new highs in 2024—and the United States has consistently accounted for the lion’s share of that spending. This reflects not only America’s previous leadership in frontier technologies but also its dependence on intangible capital, from algorithms and data infrastructure to human expertise and institutional trust. However, this dominance also underscores the strategic stakes of current policy choices. In an environment of rising trade tensions and potential fragmentation, the foundations of US leadership in AI—cross-border collaboration, data openness, and global market access—could be at risk.

250507Z6.jpg

Financial market sentiment has rebounded in recent weeks, buoyed by signs of de-escalation in the US-led trade war and growing confidence that central banks—particularly the Federal Reserve—will step in with more rate cuts to cushion any fallout. Yet beneath the surface, a more sobering picture of the global economy persists. For example, latest PMI surveys reveal that global business expectations have slumped to their lowest levels since the pandemic, reflecting widespread unease about the growth outlook (chart 1). While supply chain pressures have so far remained contained, suggesting no repeat of the logistical chaos seen during the pandemic (chart 2), the latest Blue Chip Financial Forecasts survey reveals that forecasters are now pencilling in deeper and more widespread monetary easing than previously anticipated—an acknowledgment that demand is faltering (chart 3). Falling oil prices further reinforce this view: they are both a symptom of weakening global demand and a potential source of disinflation, reducing the urgency for central banks to maintain tight policy (chart 4). At the structural level, the US economy's increasing reliance on intangible assets—ranging from intellectual property to reputation—has made it more vulnerable to geopolitical frictions and the erosion of global trust (chart 5). This risk is compounded by America's dominant role in AI investment, a sector symbolic of both its economic strengths and its exposure to international perceptions (chart 6). The longer-term challenge, then, is not just navigating the current downturn, but ensuring that the institutional goodwill and cross-border openness that support the modern US economy are not sacrificed in a more fragmented and uncertain global order.

Charts of the Week: Relief Rally Meets Recession Risk

250507J1.jpg

250507K1.jpg

At today’s meeting of the Federal Open Market Committee, the target range for the Fed funds rate was left unchanged at 4.25% to 4.50%. This followed reductions at three consecutive meetings in the fall of 2024. Rates remain below the high of 5.25% to 5.50% in place in mid-September. Today’s target range matched expectations in the Action Economics Forecast Survey.

The statement following the meeting indicated that, “The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. Uncertainty about the economic outlook has increased further. The Committee is attentive to the risks to both sides of its dual mandate and judges that the risks of higher unemployment and higher inflation have risen.”

“The Committee's assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments.”

The Fed continued, “The Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage backed securities.”

250507L1.jpg

250507M1.jpg

- FOMC holds funds rate target at late-December level.
- Risk assessments include higher unemployment & inflation.

FOMC Targeted Funds Rate Range Is Unchanged; Increased Risks Acknowledged

Kathleen Stephansen, CBE

250507F4.jpg

250507G4.jpg

Consumer credit outstanding rose $10.2 billion (1.9% y/y) during March after declining by $0.6 billion (+1.7% y/y) during February, revised from a decline of $0.8 billion (+1.7% y/y. A $10.0 billion rise had been expected in the Action Economics Forecast Survey. As a percentage of disposable personal income, consumer credit was 22.4% in March, compared to 22.9% one year earlier.

Nonrevolving credit outstanding rose $8.3 billion (1.5% y/y) in March after easing $0.3 billion (1.3% y/y) in February. Nonrevolving credit held by depository institutions declined 7.8% y/y in March after declining 9.0% y/y in February. Finance company debt holdings rose 0.8% y/y, while credit union holdings eased 1.9% y/y in March. Nonrevolving debt held by the federal government rose 3.4% y/y.

In March, revolving credit outstanding, which includes credit cards, rose $1.9 billion (2.9% y/y) following a decline of $0.3 billion (2.9% y/y) in February. Revolving credit outstanding held by depository institutions fell 1.5% y/y. Revolving credit held by finance companies dropped 12.2% y/y, while that held by credit unions rose 3.7% y/y.

The consumer credit figures from the Federal Reserve Board are break-adjusted and calculated by Haver Analytics. The breaks in the series in 2005, 2010 and 2015 are the result of the incorporation of data from the Census and the Survey of Finance Companies, as well as changes in the seasonal adjustment methodology. The consumer credit data are available in Haver’s **USECON** database. The Action Economics forecast figures are contained in the **AS1REPNA** database.

250507H4.jpg

250507I4.jpg

- Consumer credit rises close to expectations.
- Nonrevolving and revolving credit rise.


U.S. Consumer Credit Rebounded in March

250507A20.jpg

250507B20.jpg

Mortgage applications increased 11.0% (26.0% y/y) in the week ended May 2, after declining 4.2% in the week ended April 25, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. Applications to purchase a home rose 11.1% (12.9% y/y) in the week ended May 2 after declining 4.4% in the previous week. Loan applications to refinance a home loan also increased 11.1% (51.0% y/y) in the latest week after falling 3.7% in the prior week.

The effective interest rate on a 30-year fixed rate loan of 7.03% in the week ended May 2 compared to 7.08% in the prior week. The effective rate on a 15-year fixed rate loan of 6.34% in the week ended May 2 followed 6.36% in the prior week. The rate on a 30-year jumbo loan declined to 6.99% in the latest week from 7.06% in the prior week, while the rate on a 5-year ARM eased	to 6.08% in the week ended May 2 from 6.12% in the prior week.

The share of applications to refinance an existing mortgage slipped to 37.1% in the week ended May 2 from 37.3% in the prior week. The share of loans with an adjustable rate rose to 8.3% in the latest week from 7.4% one week earlier.

The average size of a mortgage loan rose 4.2% (3.8% y/y) to $400,200 in the week ended May 2, after slipping 0.7% to $384,100 in the prior week. The average size of a loan to purchase a home increased 1.0% (0.2% y/y) to $444,300 in the latest week from $440,100 in the week prior. The average size of a loan to refinance an outstanding mortgage increased 12.3% (27.6% y/y) last week to $325,400 from $289,800 one week earlier.

The Mortgage Bankers Association Survey covers 75% 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 **SURVEYS** database.

- Purchase & refinancing loan applications jump.
- Effective interest rates remain range-bound.
- Average loan size increases.

Mortgage Applications Surge as Interest Rates Ease Last Week

250506J8.jpg

250506K8.jpg

The U.S. trade deficit in goods and services (BOP basis) in March grew to $140.5 billion after narrowing slightly to $123.2 billion in February, revised from $122.7 billion, after widening to $130.7 billion in January according to the U.S. Census Bureau. A $136.7 billion deficit was expected by the Action Economics Forecast Survey. Exports rose 0.2% (6.7% y/y) in March after increasing 2.8% in February. This was accompanied by a 4.4% rise (27.1% y/y) rise in imports which came after m/m stability in February. In Q1’25, the deficit grew to an average $131.4 billion, after rising to an average $83.3 billion in Q4’24.

The trade deficit in goods (BOP basis) widened to a record $163.2 billion in March from $147.9	 billion in February, revised from $147.0 billion. Goods exports (customs value) rose 1.4% (7.0% y/y) in March, after increasing 3.6% in February. The latest increase reflected an 8.2% (8.4% y/y) surge in auto exports which came after a 12.7% strengthening. A 3.5% (4.0% y/y) gain occurred in industrial supplies & materials exports which followed a 5.1% rise. Foods, feeds & beverage exports rose 6.6% (1.4% y/y) after declining in four of the prior five month. Working lower, capital goods exports fell 2.5% (+13.9% y/y) in March after a 4.	8% increase and nonauto consumer goods exports were off 1.1% (+3.4% y/y) in March after a 2.4% gain.

Imports of goods increased 5.5% (31.4% y/y) in March after a 0.2% February easing. Imports of nonauto consumer goods imports surged 27.9% (56.0% y/y) following a 3.1% February gain. Auto imports rose 6.6% (8.7% y/y) after a 1.2% rise. Capital goods imports rose 4.2% (22.5% y/y) following a 1.1% rise. Foods, feeds & beverage imports eased 0.4% (+11.1% y/y) following a 2.0% weakening. Industrial supplies & materials imports declined 12.4% (+39.5% y/y) after weakening 4.6% in February. Petroleum imports by end-use fell 4.1% (-10.2% y/y) after a 2.9% decline. Nonpetroleum imports increased 6.0% (34.8% y/y) after holding steady in February.

The inflation-adjusted goods trade deficit (customs value) deepened to $150.9 billion in March from $136.9 billion in February. Real exports rose 1.6% (5.3% y/y) after a 3.0% February increase, while real imports rose 5.8% (29.8% y/y) in March following a 0.5% February slip.

The services trade surplus narrowed to $23.0 billion in March after decreasing to $23.8 billion in February. It reached a peak of $25.7 billion in November of last year. Service exports fell 0.9% (+5.7% y/y) after a 0.8% decline in February. Construction services exports rose 1.0% (37.7% y/y) after increasing 2.6% in February. Travel services exports fell 7.1% (-3.7% y/y) and financial exports increased 0.9% (7.3% y/y). Transport exports rose 3.1% (2.4% y/y). Service imports eased 0.1% (+10.8% y/y) in March following a 0.8% gain. Maintenance & repair services declined 1.5% (+32.1% y/y) while imported transport services increased 1.2% (1.7% y/y). Imported travel services fell 2.2% (5.3% y/y) while charges for use of intellectual property rose 1.0% (13.6 y/y).

The U.S. goods trade deficit with China narrowed to a seasonally adjusted $24.8 billion in March from $26.6 billion in February. Exports to China declined 8.2% (-10.5% y/y) while imports weakened 7.2% (-2.7% y/y). The deficit with the European Union deepened to a record $48.3 billion in March from $30.9 billion in February. Exports rose 10.9% (14.5% y/y) while imports soared 34.0% (65.4% y/y). The deficit with Japan deepened to $5.8 billion from $5.2 billion in February. Exports rose 1.8% (8.8% y/y) and imports rose 6.4% (9.9% y/y).

The international trade data, including relevant data on oil prices, can be found in Haver’s **USECON** database. Detailed figures on international trade are available in the **USINT** and **USTRADE** databases. The expectations figures are from the Action Economics Forecast Survey in **AS1REPNA**.

250506L8.jpg

250506M8.jpg

- Goods deficit grows as imports surge ahead of tariff imposition.
- Exports edge higher, led by autos.
- Petroleum product imports fall as crude oil prices decline.

Economy in Brief: March 2006

Jump to:

Initial Unemployment Insurance Claims Ticked Higher

Challenger Layoffs Down Sharply

U.S. Construction Increase Light

U.S. Vehicle Sales Down in February

U.S. Vehicle Sales Down in February

Rumors of Home Prices' Demise Exaggerated

Mortgage Applications Off Sharply

Chain Store Sales Surged