Tom Moeller

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041130c.jpg" width="353">
Chain store sales during the pivotal Thanksgiving week slid 1.5% from the prior week, according to the International Council of Shopping Centers (ICSC)-UBS.
The decline left sales so far in November just 0.4% ahead of October.
The leading indicator of chain store sales from ICSC was unchanged after two weeks of 0.5% decline. The monthly average is up 0.1% from October which rose 0.4% from September.
During the last ten years there has been a 60% correlation between y/y change in chain store sales and the change in non-auto retail sales less gasoline.
The ICSC-UBS retail chain-store sales index is constructed using the same-store sales 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%">
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<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">11/27/04</th>
<th scope="col">11/20/04</th>
<th scope="col">Y/Y</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Total Weekly Chain Store Sales</td>
<td>432.9</td>
<td>439.6</td>
<td>2.4%</td>
<td>2.9%</td>
<td>3.6%</td>
<td>2.1%</td>
</tr>
</tbody>
</table>
</body>
</html>

Chain store sales during the pivotal Thanksgiving week slid 1.5% from the prior week, according to the International Council of Shopping Centers (ICSC)-UBS. The decline left sales so far in November just 0.4% ahead of October. The [...]

Chain Store Sales Very Disappointing During Thanksgiving Week

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041130a.jpg" width="353">
US real GDP advanced 3.9% (AR) last quarter, up slightly from the advance report of growth at a 3.7% rate. The Consensus expectation had been for no change at 3.7%.
Corporate profits w/ inventory (IVA) and capital consumption adjustments (CCAdj) fell 2.4% (+8.4% y/y), the first quarterly decline since 1Q03. Part of this decline in &quot;operating&quot; profits occurred as the CCAdj for depreciation rose a sharp 6.3%, the largest quarterly advance in three years. However that was offset by a lessened (IVA).<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041130b.jpg" width="353">
&quot;Book&quot; profits before tax fell 2.4% (+9.5% y/y) due to lower profits earned in the financial sector, off 13.4% q/q and 10.5% y/y. Nonfinancial corporate sector profits rose 1.6% (18.9% y/y), though the quarterly rate of gain was the weakest since 1Q03 and reflected no expansion in profits per unit of output (margins).
Revisions to growth in domestic final demand were modestly positive. Personal consumption grew at a 5.1% (3.6% y/y) rate versus the initial report of 4.4% growth due to upward revisions in most categories. Business investment growth also was revised up to a 13.0% rate (10.1% y/y) with spending on equipment &amp; software growth raised to 17.2% (12.8% y/y). Growth in information processing equipment &amp; software was nearly doubled to 7.6% (13.6% y/y).
Residential investment grew at a 1.8% rate (8.1% y/y) but its contribution to real GDP growth was halved to 0.1 percentage points versus 0.9 points in 2Q04).
Slower accumulation of inventories subtracted nearly twice the 0.5 percentage points from GDP growth estimated in the advance report, but that was mostly offset by a lessened drag from foreign trade deterioration. Export growth was revised up to 6.4% (9.5% y/y) and import growth was eased to 6.0% (11.5% y/y).
Expanded detail indicated that GDP less motor vehicles rose 3.7% (AR, 4.1% y/y) and that GDP less computers rose 3.8% (3.9% y/y), both estimates up a hair from the advance report.
Price inflation was unrevised at 1.3%, as expected.
The Survey of Professional Forecasters from the Federal Reserve Bank of Philadelphia is available <a href="http://www.philadelphiafed.org/files/spf/survq404.htm"> here</a>.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@E7/@E701/@E701.HTM">Chained 2000$, % AR</a></th>
<th scope="col">3Q &#39;04 (Preliminary</th>
<th scope="col">3Q &#39;04 (Advance)</th>
<th scope="col">2Q &#39;04</th>
<th scope="col">Y/Y</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">GDP</td>
<td>3.9%</td>
<td>3.7%</td>
<td>3.3%</td>
<td>4.0%</td>
<td>3.0%</td>
<td>1.9%</td>
<td>0.8%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Inventory Effect</td>
<td>-0.9%</td>
<td>-0.5%</td>
<td>0.8%</td>
<td>0.4%</td>
<td>-0.1%</td>
<td>0.5%</td>
<td>-0.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">Final Sales</td>
<td>4.9%</td>
<td>4.2%</td>
<td>2.5%</td>
<td>3.6%</td>
<td>3.1%</td>
<td>1.4%</td>
<td>1.6%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Trade Effect</td>
<td>-0.3%</td>
<td>-0.6%</td>
<td>-1.0%</td>
<td>-0.5%</td>
<td>-0.3%</td>
<td>-0.7%</td>
<td>-0.2%</td>
</tr>
<tr class="odd">
<td class="firstcol">Domestic Final Demand</td>
<td>4.9%</td>
<td>4.6%</td>
<td>3.5%</td>
<td>4.1%</td>
<td>3.4%</td>
<td>2.1%</td>
<td>1.8%</td>
</tr>
<tr>
<td class="firstcol">Chained GDP Price Index</td>
<td>1.3%</td>
<td>1.3%</td>
<td>3.2%</td>
<td>2.2%</td>
<td>1.8%</td>
<td>1.7%</td>
<td>2.4%</td>
</tr>
</tbody>
</table>
</body>
</html>

US real GDP advanced 3.9% (AR) last quarter, up slightly from the advance report of growth at a 3.7% rate. The Consensus expectation had been for no change at 3.7%. Corporate profits w/ inventory (IVA) and capital consumption [...]

US 3Q GDP Revised Up, Corporate Profits Fell

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041130a.jpg" width="353">
US real GDP advanced 3.9% (AR) last quarter, up slightly from the advance report of growth at a 3.7% rate. The Consensus expectation had been for no change at 3.7%.
Corporate profits w/ inventory (IVA) and capital consumption adjustments (CCAdj) fell 2.4% (+8.4% y/y), the first quarterly decline since 1Q03. Part of this decline in &quot;operating&quot; profits occurred as the CCAdj for depreciation rose a sharp 6.3%, the largest quarterly advance in three years. However that was offset by a lessened (IVA).<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041130b.jpg" width="353">
&quot;Book&quot; profits before tax fell 2.4% (+9.5% y/y) due to lower profits earned in the financial sector, off 13.4% q/q and 10.5% y/y. Nonfinancial corporate sector profits rose 1.6% (18.9% y/y), though the quarterly rate of gain was the weakest since 1Q03 and reflected no expansion in profits per unit of output (margins).
Revisions to growth in domestic final demand were modestly positive. Personal consumption grew at a 5.1% (3.6% y/y) rate versus the initial report of 4.4% growth due to upward revisions in most categories. Business investment growth also was revised up to a 13.0% rate (10.1% y/y) with spending on equipment &amp; software growth raised to 17.2% (12.8% y/y). Growth in information processing equipment &amp; software was nearly doubled to 7.6% (13.6% y/y).
Residential investment grew at a 1.8% rate (8.1% y/y) but its contribution to real GDP growth was halved to 0.1 percentage points versus 0.9 points in 2Q04).
Slower accumulation of inventories subtracted nearly twice the 0.5 percentage points from GDP growth estimated in the advance report, but that was mostly offset by a lessened drag from foreign trade deterioration. Export growth was revised up to 6.4% (9.5% y/y) and import growth was eased to 6.0% (11.5% y/y).
Expanded detail indicated that GDP less motor vehicles rose 3.7% (AR, 4.1% y/y) and that GDP less computers rose 3.8% (3.9% y/y), both estimates up a hair from the advance report.
Price inflation was unrevised at 1.3%, as expected.
The Survey of Professional Forecasters from the Federal Reserve Bank of Philadelphia is available <a href="http://www.philadelphiafed.org/files/spf/survq404.htm"> here</a>.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@E7/@E701/@E701.HTM">Chained 2000$, % AR</a></th>
<th scope="col">3Q &#39;04 (Preliminary</th>
<th scope="col">3Q &#39;04 (Advance)</th>
<th scope="col">2Q &#39;04</th>
<th scope="col">Y/Y</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">GDP</td>
<td>3.9%</td>
<td>3.7%</td>
<td>3.3%</td>
<td>4.0%</td>
<td>3.0%</td>
<td>1.9%</td>
<td>0.8%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Inventory Effect</td>
<td>-0.9%</td>
<td>-0.5%</td>
<td>0.8%</td>
<td>0.4%</td>
<td>-0.1%</td>
<td>0.5%</td>
<td>-0.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">Final Sales</td>
<td>4.9%</td>
<td>4.2%</td>
<td>2.5%</td>
<td>3.6%</td>
<td>3.1%</td>
<td>1.4%</td>
<td>1.6%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Trade Effect</td>
<td>-0.3%</td>
<td>-0.6%</td>
<td>-1.0%</td>
<td>-0.5%</td>
<td>-0.3%</td>
<td>-0.7%</td>
<td>-0.2%</td>
</tr>
<tr class="odd">
<td class="firstcol">Domestic Final Demand</td>
<td>4.9%</td>
<td>4.6%</td>
<td>3.5%</td>
<td>4.1%</td>
<td>3.4%</td>
<td>2.1%</td>
<td>1.8%</td>
</tr>
<tr>
<td class="firstcol">Chained GDP Price Index</td>
<td>1.3%</td>
<td>1.3%</td>
<td>3.2%</td>
<td>2.2%</td>
<td>1.8%</td>
<td>1.7%</td>
<td>2.4%</td>
</tr>
</tbody>
</table>
Chain Store Sales Very Disappointing During Thanksgiving Week 
by <a href="/comment/Moeller.html">Tom Moeller</a> November 30, 2004


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041130c.jpg" width="353">
Chain store sales during the pivotal Thanksgiving week slid 1.5% from the prior week, according to the International Council of Shopping Centers (ICSC)-UBS.
The decline left sales so far in November just 0.4% ahead of October.
The leading indicator of chain store sales from ICSC was unchanged after two weeks of 0.5% decline. The monthly average is up 0.1% from October which rose 0.4% from September.
During the last ten years there has been a 60% correlation between y/y change in chain store sales and the change in non-auto retail sales less gasoline.
The ICSC-UBS retail chain-store sales index is constructed using the same-store sales 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">11/27/04</th>
<th scope="col">11/20/04</th>
<th scope="col">Y/Y</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Total Weekly Chain Store Sales</td>
<td>432.9</td>
<td>439.6</td>
<td>2.4%</td>
<td>2.9%</td>
<td>3.6%</td>
<td>2.1%</td>
</tr>
</tbody>
</table>
Consumer Confidence Down Again 
by <a href="/comment/Moeller.html">Tom Moeller</a> November 30, 2004


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041130d.jpg" width="353">
The Conference Board&#146;s Index of Consumer Confidence fell for the fourth consecutive month, down 2.6% in November to the lowest level (90.5) since March. Consensus expectations had been for a reading of 96.0.
During the last twenty years there has been a 51% correlation between consumer confidence and the y/y change in real consumer spending.
The index of consumer expectations fell sharply for the third month in the last four to 87.4 (-12.7% y/y). The present situation index rose modestly to 95.2 (+17.5% y/y) following three months of decline.
Jobs were viewed as hard to get by 28.1% of survey participants versus 27.9% in October and by 31.8% during all of last year. Fewer jobs in six months were expected by 19.7% of participants, the highest percentage in a year.
The Conference Board&#146;s survey isconducted by a mailed questionnaire to 5,000 households and about 3,500 typically respond.

<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/@EF/@EF14/@EF1401/@EF1401.HTM">Conference Board</a></th>
<th scope="col">Nov</th>
<th scope="col">Oct</th>
<th scope="col">Y/Y</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Consumer Confidence</td>
<td>90.5</td>
<td>92.9</td>
<td>-2.2%</td>
<td>79.8</td>
<td>96.6</td>
<td>106.6</td>
</tr>
</tbody>
</table>
Chicago Purchasing Agents' Index Fell, Employment Strong 
by <a href="/comment/Moeller.html">Tom Moeller</a> November 30, 2004


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041130e.jpg" width="353">
The Chicago Purchasing Managers Business Barometer fell 3.3 points in November to 65.2 and reversed half of the October move upward. Consensus expectations had been for a decline to 62.0.
During the last ten years there has been a 73% correlation between the level of the Chicago Business Barometer and the three month change in factory sector industrial output. That correlation has risen to 86% during the last five years.
The new orders index reversed nearly all of the October gain with a 9.4 point drop. Conversely, the employment index added 6.7 points to a slight October uptick and rose to the highest level since 1988. During the last twenty years there has been an 80% correlation between the level of this employment index and the three month change in factory sector employment.
The index of prices paid rose to 89.8. During the last ten years there has been an 88% correlation between the Chicago price index and the three month change in the &quot;core&quot; intermediate goods PPI.

<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/@EF/@EF05/@EF05.HTM">Chicago Purchasing Managers Index, SA</a></th>
<th scope="col">Nov</th>
<th scope="col">Oct</th>
<th scope="col">Nov&nbsp;&#39;03</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Business Barometer</td>
<td>65.2</td>
<td>68.5</td>
<td>62.9</td>
<td>54.7</td>
<td>52.7</td>
<td>41.4</td>
</tr>
<tr>
<td class="firstcol">&nbsp; New Orders</td>
<td>70.0</td>
<td>79.4</td>
<td>68.5</td>
<td>58.0</td>
<td>56.2</td>
<td>42.3</td>
</tr>
<tr class="odd">
<td class="firstcol">Prices Paid</td>
<td>89.8</td>
<td>84.1</td>
<td>68.1</td>
<td>55.8</td>
<td>56.9</td>
<td>50.4</td>
</tr>
</tbody>
</table>
</body>
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Louise Curley

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041129h.jpg" width="353">
Gross domestic product in Denmark rose a negligible 0.04% in the third quarter. Private consumption rose almost 1% but public consumption fell by 0.6%. Gross fixed capital spending rose 3.6% and a swing in inventory change from a liquidation of 1,051 million 1995 Krone to an accumulation of 3,003 million also added a good boost to output. But the foreign trade sector offset almost all the gains on the domestic sector. The impact of net exports in the total gross national product is illustrated in the first chart.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041129g.jpg" width="353">
Although Denmark is not in the Euro zone, its currency, the krone has moved with the euro against the dollar as can be seen in the second chart. Part of the decline of 1,7% in the exports of goods and services from the second to the third quarter was due to the rising krone. At the same time, the rising krone stimulated imports of goods and service, which rose by 3.4%. However, rising prices of oil also contributed to the rise in imports. The combination of lower exports and higher imports led to a decline of 7,303 million 1995 krone in the balance of trade in goods and services from 10,224 million 1995 Krone in the second quarter to 2,921 million in the third quarter. 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">Millions of 1995 Krone</th>
<th scope="col">Q3 04</th>
<th scope="col">Q2 O4</th>
<th scope="col">Q1 04</th>
<th scope="col">Q4 03</th>
<th scope="col">Q3/Q2 %</th>
<th scope="col">&nbsp;2003&nbsp;&nbsp;</th>
<th scope="col">&nbsp;2002&nbsp;</th>
<th scope="col">&nbsp; 2001&nbsp; &nbsp;</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Gross domestic product</td>
<td>303,195</td>
<td>303,080</td>
<td>301,959</td>
<td>298,778</td>
<td>0.04</td>
<td>1,188,639</td>
<td>1,186,639</td>
<td>1,170,719</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Private consumption</td>
<td>144,509</td>
<td>143,088</td>
<td>142,118</td>
<td>141,688</td>
<td>0.99.</td>
<td>556,054</td>
<td>551,375</td>
<td>547,961</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Public consumption</td>
<td>75,864</td>
<td>76,327</td>
<td>75,186</td>
<td>76,351</td>
<td>-0.61</td>
<td>305,077</td>
<td>301,922</td>
<td>295,601</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Gross fixed capital spending</td>
<td>76,564</td>
<td>73,908</td>
<td>72,464</td>
<td>75,025</td>
<td>3.59</td>
<td>285,800</td>
<td>285,554</td>
<td>295,101</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Inventory change</td>
<td>3,003</td>
<td>-1,051</td>
<td>1,888</td>
<td>-2,433</td>
<td>4,054*</td>
<td>-4,225</td>
<td>868</td>
<td>1,162</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Exports of goods and services</td>
<td>147,319</td>
<td>149,838</td>
<td>142,218</td>
<td>140,475</td>
<td>-1.68</td>
<td>563,819</td>
<td>563,885</td>
<td>538,315</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Imports of goods and services</td>
<td>144,398</td>
<td>139,614</td>
<td>131,977</td>
<td>131,560</td>
<td>3.43</td>
<td>517,886</td>
<td>520,977</td>
<td>485.662</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Net exports of goods and services</td>
<td>2,921</td>
<td>10,224</td>
<td>10,241</td>
<td>8.915</td>
<td>-7,303*</td>
<td>45,933</td>
<td>42,908</td>
<td>52,653</td>
</tr>
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Gross domestic product in Denmark rose a negligible 0.04% in the third quarter. Private consumption rose almost 1% but public consumption fell by 0.6%. Gross fixed capital spending rose 3.6% and a swing in inventory change from a [...]

Denmark's GDP Third Quarter Growth Slowed by Decline in the Foreign Trade Balance

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041129j.jpg" width="353">
Though the November reading of Consumer Sentiment from the University of Michigan rose to 92.8, that was lower than the mid-month reading of 95.5 and indicated that Sentiment faded as the month progressed. Consensus expectations for a reading of 96.0 were disappointed.
During the last ten years there has been a 75% correlation between the level of consumer sentiment and the y/y change in real PCE.
The consumer expectations index rose 1.7% m/m (-3.3% y/y) and the current economic conditions index rose 0.7% (2.1% y/y), both off from the mid-month pace
Consumer sentiment amongst families earning more than $50,000 per year rose m/m but was down 2.0% y/y. Sentiment amongst families earning less than $50,000 per year fell m/m and fell 1.3% y/y.
The University of Michigan survey is not seasonally adjusted.The mid-month survey is based on telephone interviews with 250 households nationwide on personal finances and business and buying conditions. The survey is expanded to a total of 500 interviews at month end.
&quot;Consumer Sentiment and the Media&quot; from the Federal Reserve Bank of San Francisco can be found <a href="http://www.frbsf.org/publications/economics/letter/2004/el2004-29.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/@EF/@EF14/@EF1402/@EF1402.HTM">University of Michigan</a></th>
<th scope="col">Nov</th>
<th scope="col">Oct</th>
<th scope="col">Y/Y</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Consumer Sentiment</td>
<td>92.8</td>
<td>91.7</td>
<td>-1.0%</td>
<td>87.6</td>
<td>89.6</td>
<td>89.2</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Current Conditions</td>
<td>104.7</td>
<td>104.0</td>
<td>2.1%</td>
<td>97.2</td>
<td>97.5</td>
<td>100.1</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Consumer Expectations</td>
<td>85.2</td>
<td>83.8</td>
<td>-3.3%</td>
<td>81.4</td>
<td>84.6</td>
<td>82.3</td>
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Though the November reading of Consumer Sentiment from the University of Michigan rose to 92.8, that was lower than the mid-month reading of 95.5 and indicated that Sentiment faded as the month progressed. Consensus expectations for a [...]

U.S. Consumer Sentiment Faded Late Month

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041129f.jpg" width="353">
The National Index of Help-Wanted Advertising published by the Conference Board rose slightly to 37 in October but has been moving sideways since 2Q 2003.
The proportion of labor markets with rising want-ad volume, however, more than recovered the prior month&#39;s plunge and jumped to 71%, the highest level since May.
During the last ten years there has been an 88% correlation between the level of help-wanted advertising and the year-to-year change in non-farm payrolls.
The Conference Board surveys help-wanted advertising volume in 51 major newspapers across the country every month. 

<table border="0" cellspacing="0" width="100%">
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<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/CBDB/@C3/@C3.HTM">Conference Board</a></th>
<th scope="col">Oct</th>
<th scope="col">Sept</th>
<th scope="col">Oct &#39;03</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">National Help Wanted Index</td>
<td>37</td>
<td>36</td>
<td>36</td>
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The National Index of Help-Wanted Advertising published by the Conference Board rose slightly to 37 in October but has been moving sideways since 2Q 2003. The proportion of labor markets with rising want-ad volume, however, more than [...]

Help-Wanted Advertising Up Slightly

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Mortgage applications plunged 5.7% last week for the second sharp w/w decline this month, but the average level of activity so far in November still was up 3.1% from October according to the Mortgage Bankers Association (MBA).
Purchase applications again fell sharply by 3.5%. Though the November average was up versus October, the latest weekly level was the lowest in the last four. During the last ten years there has been a 60% correlation between the y/y change in purchase applications and the change in new plus existing home sales.
Applications to refinance skid 8.3% w/w leaving the November average up 2.4% versus October.
The effective interest rate on a conventional 30-year mortgage fell to 5.92%. It averaged 5.92% in October. The effective rate on a 15-year mortgage also fell to 5.39%.
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>.

<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">11/19/04</th>
<th scope="col">11/12/04</th>
<th scope="col">Y/Y</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Total Market Index</td>
<td>715.0</td>
<td>758.3</td>
<td>-7.8%</td>
<td>1,067.9</td>
<td>799.7</td>
<td>625.6</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Purchase</td>
<td>463.3</td>
<td>480.3</td>
<td>0.7%</td>
<td>395.1</td>
<td>354.7</td>
<td>304.9</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Refinancing</td>
<td>2,179.3</td>
<td>2,375.4</td>
<td>-16.6%</td>
<td>4,981.8</td>
<td>3,388.0</td>
<td>2,491.0</td>
</tr>
</tbody>
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Mortgage applications plunged 5.7% last week for the second sharp w/w decline this month, but the average level of activity so far in November still was up 3.1% from October according to the Mortgage Bankers Association (MBA). [...]

Mortgage Applications Plunged

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/041129d.jpg" width="353">
Last week, initial claims for unemployment insurance fell 12,000 to 323,000 from a little revised 335,000 the prior week. The Consensus expectation had been for 335,000 claims.
The four week moving average of initial claims fell to 332,000 (-9.7% y/y), the lowest level since November 2000.
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 fell 29,000 following a downwardly revised 24,000 drop the prior week.
The insured rate of unemployment remained at 2.2% for the seventh 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">11/20/04</th>
<th scope="col">11/13/04</th>
<th scope="col">Y/Y</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
<th scope="col">2001</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Initial Claims</td>
<td>323</td>
<td>335</td>
<td>-10.8%</td>
<td>402</td>
<td>404</td>
<td>406</td>
</tr>
<tr>
<td class="firstcol">Continuing Claims</td>
<td>--</td>
<td>2,755</td>
<td>-18.1%</td>
<td>3,531</td>
<td>3,570</td>
<td>3,018</td>
</tr>
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Last week, initial claims for unemployment insurance fell 12,000 to 323,000 from a little revised 335,000 the prior week. The Consensus expectation had been for 335,000 claims. The four week moving average of initial claims fell to [...]

Initial Unemployment Insurance Claims Fell Unexpectedly

PMIs showing widespread revival of global economy

Crude oil price has returned to pre-conflict level but traffic through Hormuz still subpar

Surging orders for computers and electronics propelling durable goods orders

Next year's inflation forecasts are on the rise and above target

Disrupted global supply chains placing upward pressure on US goods prices

Construction of data centers has overtaken transportation construction in US

Elevated energy prices putting intense upward pressure on input prices around the globe

US is big leader in global surge in private AI investment

Larger-than-usual income tax refunds this year are supporting consumer spending

Sharply rising share of AI-related jobs

Inflationary impact of surge in oil prices larger in Europe than in the US

Futures market thinks the price of oil will recede significantly over the next six months

Recent pickup in US defense orders could help support overall growth ahead

Cost of transporting crude oil has soared to series high

Market-based inflation expectations have not yet reflected recent surge in oil prices

Global equity markets are fearing a major economic disruption from soaring oil prices

Is recent drop in sentiment signaling softer growth ahead?

With the Iran conflict, geopolitical risk has soared to alarming levels

Soaring AI-related investment in US underpinning strong contribution of business spending to overall growth

AI-related outperformance of IP in Advanced Asia ex Japan

Resilient US economy pushing up Blue Chip 2026 outlook

US and China big leaders in adoption of AI models

Robust US demand for advanced technology products

China's export growth rotating away from the US

More pronounced upward revisions in countries more exposed to AI investment

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Andrew Cates

**Growth Surprises Continue to Underpin Equity Resilience**
Global equity markets have proved remarkably resilient in recent weeks, shrugging off intermittent bouts of geopolitical and policy uncertainty to grind higher. Chart 1 below helps explain why: it tracks the relationship between global growth-versus-inflation surprises and world equity markets, and on that measure the recent run of global growth data has continued to surprise on the upside relative to inflation outturns — a combination that has historically been supportive for risk assets. Whether that resilience persists will depend on whether the growth-surprise advantage evident in the chart below can be sustained in the face of the inflationary pressures explored below.

260709Z1.jpg

**PMIs Confirm a Broadly Solid Global Expansion**
This week's final composite PMI readings for June reinforced the broader impression of resilient global growth. As chart 2 below shows, most major economies posted readings comfortably in expansionary territory, with India continuing to lead the pack and the US not far behind. Even the laggards in the sample are hovering close to the expansion threshold rather than falling decisively below it, suggesting stabilisation rather than outright contraction (and with the UK a notable exception).

260709Z2.jpg

**Inflation Surprises Are Creeping Back, and Bond Yields Are Taking Notice**
The US growth picture painted by Haver's surprise indices broadly echoes the message from the global PMI data. Chart 3 below shows the combined growth-and-inflation surprise index drifting higher this week, and closer inspection suggests growth is doing most of that work, with activity data continuing to outperform expectations. That is, on the face of it, good news. But it has not stopped bond markets from taking notice: short-dated Treasury yields have remained elevated in recent weeks, as stronger growth keeps alive the possibility that the Federal Reserve holds rates higher for longer or even lifts them in coming weeks.

260709Z3.jpg

**Supply Chains Are Tightening** 
Latest data show that global supply chain pressures tightened by less in June than they had the month before, likely reflecting the easing of Middle East tensions through much of the period. Chart 4 below shows that pressures troughed in the middle of last year and have been building gradually since, though June's slower pace of tightening suggests that easing had started to feed through. Still, today's flare-up threatens to undo that improvement, particularly if it affects shipping routes or energy flows through the region once again.

260709Z4.jpg

**Extreme Weather: An Old Supply-Side Risk Returns**
Geopolitics is not the only source of supply-side risk currently in play. Large parts of Europe have been gripped this week by another intense and prolonged heatwave, with temperatures in several major cities running well above seasonal norms. Extreme heat of this kind carries real economic costs: it depresses labour productivity, particularly in outdoor and manufacturing-adjacent sectors, strains electricity grids as air-conditioning demand spikes, and can disrupt agricultural output and river-based transport when water levels fall. Episodes like this have become more frequent in recent years, and while any single heatwave rarely shifts the macro picture on its own, the cumulative effect of more frequent and more severe weather events could start showing up in productivity and inflation data across the advanced economies. It is a reminder that the supply side of the global economy faces structural as well as cyclical challenges, and that climate-related disruption deserves a permanent place alongside geopolitics and demographics in any assessment of medium-term inflation risk.

260709Z5.jpg

**AI Investment: The Other Side of the Supply Equation**
Set against these supply-side headwinds is a genuinely positive structural development: the extraordinary scale of private investment now flowing into artificial intelligence. Chart 6 below shows just how sharply that investment has grown in recent years, reaching a fresh high last year. If even a fraction of that investment translates into genuine productivity gains, it could provide a meaningful long-run offset to the energy, climate and geopolitical constraints highlighted elsewhere in this week's charts. The scale of the bet now being placed on AI is large enough that it is beginning to show up in aggregate investment and capital expenditure data across the advanced economies, and it is likely to remain one of the defining structural themes shaping the global growth outlook over the remainder of this decade.

260709Z6.jpg

Global markets head into this week’s closing stages digesting a mixed set of signals. Last week's US non-farm payrolls report undershot expectations, adding to questions about the durability of the US labour market even as broader activity data have continued to hold up well. Compounding that picture, news broke today of renewed instability in the Middle East, reintroducing a geopolitical risk premium into markets just as investors had begun to look past it. Global equity markets have nonetheless remained resilient, continuing to track the broadly encouraging tone of incoming activity data (chart 1). That resilience was reinforced by a solid set of global PMIs across most major economies over the past few days (chart 2). Haver's surprise indices tell a similar story of positive growth momentum in the US, but with an important caveat: incoming inflation data have also been surprising to the upside, driven largely by higher oil prices (chart 3). These inflation risks could persist moreover, as global supply chain pressures have picked up in recent months and today's flare-up in the Middle East threatens to add further strain (chart 4). The world economy remains vulnerable to other supply-side shocks too, such as the extreme heat gripping much of Europe this week (chart 5). Still, on the other side of the ledger the enormous scale of investment now flowing into artificial intelligence could be a genuine source of supply-side potential (chart 6).

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Charts of the Week: Growth Holds Firm

Winnie Tapasanun

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Existing home sales unexpectedly fell 2.4% m/m (+2.8% y/y) to 4.09 million units (SAAR) in June, the first monthly decline since March, following an upwardly revised 3.7% increase to 4.19 million in May (previously +3.2%; 4.17 mil.), according to the National Association of Realtors (NAR). The Action Economics Forecast Survey had expected June sales of 4.20 million units. Sales remained 36.4% below a high of 6.43 million in January 2022 and 38.0% below a peak of 6.60 million in January 2021. The June decline coincided with a rise in the average 30-year fixed mortgage rate to 6.49% in June, the highest since August 2025, after increasing to 6.44% in May, according to Freddie Mac. The sales figures are based on closings of sales contracts signed over the past couple of months.

Existing single-family home sales fell 2.4% (+3.3% y/y) to 3.73 million units in June, the first m/m fall in three months, following a 4.1% gain to 3.82 million in May, remaining 34.6% below a high of 5.70 million in January 2022. Sales of condos and co-ops decreased 2.7% (-2.7% y/y) to 360,000 in June, the lowest level since May 2025, after being unchanged m/m for the third successive month at 370,000, remaining 50.7% below a high of 730,000 in January 2022.

Regionally, June existing home sales declined m/m in all regions except the Northeast. Sales in the South dropped 3.6% (+3.8% y/y) to 1.89 million in June, a three-month low, after a 3.2% rise in May, and sales in the Midwest slid 3.0% (+2.1% y/y) to 980,000 following a 7.4% May advance; both posted the first m/m decrease in three months. Sales in the West fell 1.3% (+2.8% y/y) to 740,000, the lowest level since January, after being flat m/m at 750,000 in May. In contrast, sales in the Northeast increased 2.1% (0.0% y/y) to 480,000 after a 4.4% May gain. Notably, the South remained the dominant region, accounting for 46.2% of total U.S. existing home sales.

The median price of all existing homes (NSA) rose 2.2% (1.8% y/y) to $440,600 in June, the fifth consecutive m/m rise, on top of an upwardly revised 3.3% increase to $431,200 in May ($429,300 previously). Prices were 22.1% above a low of $360,800 in January 2023. The median price of an existing single-family home climbed 2.3% (1.8% y/y) to $446,400 in June, the fifth straight m/m increase, after a 3.4% advance to $436,400 in May. The median price of condos and co-ops, up for the sixth time in seven months, grew 0.6% (1.6% y/y) to $380,000 following a 1.0% May gain to $377,800. Regionally, overall prices rose m/m and y/y in June in the Northeast (+5.6%; +3.9% y/y), Midwest (+2.1%; +2.7% y/y), South (+1.0%; +0.9% y/y), and West (+0.8%; +0.9% y/y). All these price series were at their record highs.

Inventories of homes for sale fell m/m in June for the first time since December. The number of existing homes for sale (NSA) declined 0.6% (+1.3% y/y) to 1.56 million units following an upwardly revised 4.7% May rise to 1.57 million (the highest level since November 2019). The supply of homes on the market at the current selling rate (NSA) increased to 4.6 months in June from 4.5 months in May and April, matching the highest level since August 2025. A record low in supply of 1.6 months was in January 2022.

The data on existing home sales, prices and affordability are compiled by the National Association of Realtors. The data on single-family home sales extend back to February 1968. Total sales and price data and regional sales can be found in Haver's **USECON** database. Regional price and affordability data and national inventory data are available in the **REALTOR** database. Mortgage interest rates can be found in the **WEEKLY** database. The expectations figure is from the Action Economics Forecast Survey, reported in the **AS1REPNA** database.

260709H57.jpg

260709I57.jpg

- June sales -2.4% m/m to 4.09 mil., first drop in three mths.; +2.8% y/y, third straight y/y rise.
- Sales m/m down in the South (-3.6%), Midwest (-3.0%), and West (-1.3%); up in the Northeast (+2.1%).
- Sales y/y up in all regions except the Northeast w/ a flat reading.
- Median sales price +2.2% (+1.8% y/y) to $440,600, a record high.
- Unsold inventory -0.6% (+1.3% y/y) to 1.56 mil. units, first m/m decline since Dec.; 4.6 months' supply, highest since Aug. ’25.

U.S. Existing Home Sales Unexpectedly Fall in June from a Five-Month High

Kathleen Stephansen, CBE

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260709B1.jpg

Initial claims for unemployment insurance declined 2,000 to 215,000 in the week ending July 4, from 217,000 in the week ending June 27, revised from 215,000. The four-week average was 218,750 in the July 4 week, down from 222,500 in the week ending June 27. The Action Economics/Haver Analytics Survey looked for 218,000 claims to have been filed. 

The total number of unemployment insurance beneficiaries—also known as “continuing claims”—rose by 8,000 to 1.814 million in the week ending June 27, from 1.806 million in the week ending June 20, revised from 1.814 million. The four-week moving average rose to 1.808 million in the June 27 week from 1.801 million in the June 20 week. The insured unemployment rate was unchanged at 1.2% in the week of June 27. Except for a one-week dip to 1.1% in the week of April 25, the insured unemployment rate has been at 1.2% since the week of November 29, 2025.

The insured unemployment rate varied greatly across individual states and territories. In the week ending June 20, the highest unemployment rates were in Washington (2.03%), New Jersey (2.11%), Minnesota (2.15%), and Puerto Rico (2.45%). The lowest rates were in South Dakota (0.28%), Florida (0.35%), Alabama and North Carolina (both 0.41%), Louisiana (0.42%), and Arkansas (0.49%). Rates in other notable states include California (1.88%), Pennsylvania (1.63%), Illinois (1.58%), New York (1.52%), and Texas (1.12%). These state data are not seasonally adjusted.

Data on weekly unemployment claims are from the Department of Labor itself, 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.

260709C1.jpg

260709D1.jpg

- New claims declined by 2,000 to 215,000 in the week ending July 4.
- Continuing claims rose by 8,000 to 1.814 million in the week ending June 27.
- The insured unemployment rate was unchanged at 1.2% in the week of June 27.

U.S. Initial Unemployment Claims Declined in the Week of July 4

Robert Brusca

260709E.jpg

The German trade surplus surged in May to €19.1 billion from €14.7 billion in April. Exports rose by 0.9% in May while imports fell by 2.5%, creating a jump in the surplus month-to-month. In April, exports increased by 0.8% while imports rose by 1.1%.

Details on exports and imports lag by one month. In April, exports for motor vehicles and consumer goods declined, while exports of capital goods and other exports rose. On the import side, there were increases in imports ranging from 2.8% to 4.3% month-to-month across capital goods, motor vehicles, and consumer goods, but for the catch-all category ‘other’ imports fell by 2.7% month-to-month.

Flows adjusted for inflation showed an increase in exports of 0.4% in May while real imports fell by 3.3%. In April, real exports were flat while real imports fell by 0.2%.

The sequential behavior of real exports and real imports show independent activity. Imports log a clear weakening, rising 0.1% over 12 months, falling at a 5% annual rate over six months, and then falling at a 10.3% annual rate over three months. On the export side, real exports rose by 2.6% over 12 months, accelerated to a 7.2% annual rate over six months, but over three months have pulled back and fallen at a 1.6% annual rate. However, export growth still exceeds import growth over each of these horizons: 12 months, six months, and three months.

Trade trends paint a darkening picture of the German economy, with imports weak in real terms and trending even weaker, while activity on the export side of the equation pops over 12 months and six months but takes a hit over three months.

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The situation in the Strait of Hormuz continues to muddy the waters for the future. Passage through the strait has been sharply stopped, stabilized, revived, and now is back to being destabilized. That makes the strait a major uncertainty zone; it's hard to tell how these effects are going to play out over the coming months for German trade results and everyone else's. The deterioration of conditions in the Strait of Hormuz is now unknowable because Iran has decided to start shooting at ships, further destabilizing the outlook.

Germany

German Trades Surplus Balloons

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Mortgage applications dropped 2.2% w/w (-5.4% y/y) in the week ending July 3, following no change in the week ending June 26, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. Applications for loans to purchase a house edged down 0.6% w/w (-6.3% y/y) in the latest week, after rising 0.5% w/w (3.2% y/y) in the June 26 week.  Applications for loan refinancing dropped 4.1% w/w (-4.2% y/y) in the week ending July 3, after declining 0.7% w/w (+9.1% y/y) in the June 26 week.

The effective interest rate on a 30-year fixed-rate loan rose 1bp to 6.77% in the week ending July 3 from 6.76% in the week ending June 26. The rate on 15-year fixed-rate mortgages edged down 2bps to 6.17% in the July 3 week from 6.19% in the June 26 week. The 30-year Jumbo rate edged down 1bp to 6.62% in the latest week from 6.63% in the June 26 week. The rate on a 5-year ARM rose 5bps to 6.19% in the July 3 week from 6.14% in the June 26 week.

The share of applications for refinancing an existing loan declined to 40.6% of total applications in the week of July 3 from 41.4% in the June 26 week. The adjustable-rate mortgage (ARM) share of activity edged up to 7.8% in the July 3 week from 7.6% in the June 26 week.

The average size of a mortgage declined 0.4% w/w (+1.3% y/y) to $391,500 in the week ending July 3, after rising 1.1% w/w (0.4% y/y) to $393,200 in the week ending June 26. The average size of a purchase loan declined 1.0% w/w (+4.3% y/y) to $451,000 in the latest week, after rising 1.2% w/w (2.7% y/y) to $455,600 in the June 26 week. The average size of a loan to refinance a mortgage edged down 0.1% w/w (-3.9% y/y) to $304,600 in the week ending July 3, after rising 0.5% w/w (-2.8% y/y) to $304,900 in the June 26 week.

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.

- Both applications for loans to purchase and applications for loan refinancing declined in the latest week.
- Interest rate on 30-year fixed-rate loans rose 1bp to 6.77%. 
- Average loan size edged down.

Economy in Brief

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Chain Store Sales Very Disappointing During Thanksgiving Week

US 3Q GDP Revised Up, Corporate Profits Fell

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Mortgage Applications Plunged

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