Haver Analytics
Haver Analytics

Economy in Brief

    • Mortgage loan applications decline for third consecutive week.
    • Purchase loan applications decline for fifth consecutive week.
    • 30-year fixed-rate mortgage eased only slightly in the last week.
  • In February, the European Commission economic sentiment index from the monetary union declined to 95.4 from January’s 96.1, a surprise development. This drops the reading below even its December level but above its November level. Declines are logged in three of five sectors with the industrial sector, the retail sector, and the services sector, each weakening month-to-month. The construction assessment was unchanged between January and February while consumer confidence increased to a -15.5 reading in February from -16.1 in January.

    • Present situations reading reverses January rise.
    • Expected conditions fall modestly.
    • Inflation expectations remain lowest in four years.
    • Orders fell a larger-than-expected 6.1% m/m.
    • Nondefense aircraft orders plunged 58.9% m/m.
    • Orders excluding aircraft rose 0.6% m/m.
    • Core capital goods shipments increased 0.8%, providing a good start for Q1.
    • FHFA HPI +0.1% (+6.6% y/y) in Dec., the smallest m/m gain in 11 months.
    • House prices rise m/m in four of nine census divisions but fall m/m in West North Central, New England, and Pacific.
    • House prices gain y/y in all of the nine regions, w/ the highest rate in New England (10.1%).
    • Gasoline prices back away from November high.
    • Crude oil prices slip but remain above the June low.
    • Natural gas prices ease and remain near 2020 low.
  • Money and Credit in EMU- Money growth rates in the European Monetary Union are starting to show clear acceleration although the move higher is moderate. M2 growth in the Monetary Union shows a decline of 1.2% over 12 months, an increase of 0.3% at an annual rate over six months, and a 1.2% annual rate increase over three months-- a clear moderate accelerating pattern. Credit to residents in the Monetary Union continues to waffle as it declines over 12 months and three months but manages an uptick over six months; private credit shows the same pattern.

    Real balances in EMU- Real money balances that reflect money supply indexed for the effects of inflation also shows a tendency to move higher although it is still contracting on all horizons. Real money growth declines at a 3.9% annual rate over 12 months, declines at a 1.9% annual rate over six months, and declines at a 1% annual rate over three months. Real credit to residents in real terms shows no clear pattern but declines on the order of 2% to 3% over three months to 12 months. The same is true for real private credit.

    Global money trends- Real money balances in the Monetary Union have been declining over the last three years, the same pattern is pretty much true for the U.S., the U.K., Japan, and the other major monetary center countries. U.S. and U.K. monetary growth are calculated through December rather than January because they are not yet updated. For both the U.S. and the U.K., real balances do not decline over the most recent three-month period. U.K. real balances are flat; U.S. balances increased at a 0.2% annual rate, a very small rate of increase. Only Japan, among the major monetary center countries, shows flirtation with growth in real balances even over the three years. Over three years Japan real balances grow by 0.6%; over two years they fall by 0.6%; over 12 months they rise by 0.2%; over six months they fall a 0.5% annual rate; over three months real Japan money balances are growing at a 1.7% annual rate.

    • Jan. sales up 1.5% (1.8% y/y) to 661,000 units SAAR, the second straight m/m gain; Dec. revised down.
    • Sales increase m/m except in the South; sales rise y/y except in the Midwest and the South.
    • Median sales price rebounds 1.8% (-2.6% y/y) to $420,700.
    • Months' supply of new homes for sale unchanged at 8.3 months.