Tom Moeller

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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 src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090526b.jpg" align="right" border="0" height="265" width="353">
The S&amp;P/Case-Shiller Composite 20
Home Price Index fell 2.2% during March. The latest decline lowered
prices by 18.7% during the last twelve months and by 31.4% since their
peak in May 2006. The series dates back only to 2000 and the
March decline in prices was as expected.
The S&amp;P/Case-Shiller home price series can be found in
Haver's USECON database and the city data
highlighted below is in the REGIONAL database.
The Case-Shiller index of 20 U.S. cities and their surrounding
areas is weighted to reflect price changes due to extensive remodeling,
home additions or extreme neglect. For example, smaller weights are
assigned to sales of homes that have undergone extensive remodeling.
The Case-Shiller composite index of homes in 10 metropolitan
areas, which has a longer history and dates back to 1987, also fell
2.0% and was down 18.6% year-to-year. The measure was down 32.4% since
the 2006 peak.
Weakest Regions: Home prices in Phoenix,
Nevada were quite weak and fell 36.0% y/y and in San Francisco prices
fell 30.0% y/y, off by nearly one half from their early-2006 peak. Home
prices in Las Vegas, Nevada fell 31.2% y/y and also were down by
roughly one half from their peak. Prices in Miami fell 28.7% y/y while
home prices in Los Angeles were down 22.3% y/y. In Tampa they fell
22.4% and in Detroit home prices dropped by 25.7% y/y, off 43.7% from
the peak.<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090526c.jpg" align="right" border="0" height="265" width="353">
Less Weak Regions: In the Northeast, the
decline in home prices continued less severe. Prices in New York fell
11.8% y/y, off 19.6% from their 2006 peak. Prices were down 8.0%
year-to-year in Boston but in Chicago home prices were down a larger
18.6% y/y, off one-quarter from the 2007 peak. In Cleveland, Ohio the
decline in home prices accelerated during February and they fell 1.0%
m/m and 9.0% y/y but in Dallas prices were off by a moderate 5.5% y/y
and by 9.1% from the 2007 peak. In Charlotte, North Carolina prices
fell a moderate 9.3% y/y and in Denver home prices prices fell just
5.5% y/y.
The latest press release from Standard &amp; Poor's can be
found <a href="http://www2.standardandpoors.com/spf/pdf/index/CSHomePrice_Release_052619.pdf">here</a>.
An overview of the S&amp;P/Case-Shiller home price series can be
found <a href="http://www2.standardandpoors.com/portal/site/sp/en/us/page.topic/indices_csmahp/0,0,0,0,0,0,0,0,0,1,1,0,0,0,0,0.html">here</a>.
The history of the Case-Shiller data is available in Haver's USECON
database.
Remarks made by Fed Chairman Ben S. Bernanke on Dealing
With The Reality of Unpredictability are available <a href="http://www.federalreserve.gov/newsevents/speech/bernanke20090522a.htm">
here</a>.




<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol">S&amp;P/Case-Shiller
Home Price Index (SA, Jan 00 = 100)</th>
<th scope="col">March</th>
<th scope="col">February</th>
<th scope="col">Y/Y</th>
<th scope="col">2008</th>
<th scope="col">2007</th>
<th scope="col">2006</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">20 City Composite
Index</td>
<td>141.35</td>
<td>144.48</td>
<td>-18.7%</td>
<td>-15.8%</td>
<td>-3.8%</td>
<td>7.6%</td>
</tr>
</tbody>
</table>
</body></html>

The S&P/Case-Shiller Composite 20 Home Price Index fell 2.2% during March. The latest decline lowered prices by 18.7% during the last twelve months and by 31.4% since their peak in May 2006. The series dates back only to 2000 and the [...]

Case-Shiller Home Price Index Is Down By Nearly One-Third From 2006 Peak

Robert Brusca

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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 src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090526a.jpg" align="left" border="0" height="265" width="353">IFO improves, barely -- The
IFO survey is in the same boat as the rest of the recent economic
indicators. The index is off its low, and rising but still showing
contraction. The improvement in May continued but was very slight for
most sectors. Manufacturing was unchanged at a reading of -38 on the
month. Construction actually got worse in the month. Despite the
worsening of construction it remains in the 46th
percentile of range since 1991-about a middling reading. Construction
has been pressured for some time. MFG is in the bottom seven percentile
of its range. Wholesaling and
retailing are in the bottom 17th to 22nd
percentile of their respective ranges.
Outlook uncertain --
Germany is still quite weak. There
is a legacy of bottoming and rebounding but on the other hand the
rebound trends is a mild gradient and the sense of upward momentum is
slight. The future is still
in doubt. 

<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr><th colspan="9" scope="col"> Summary
of IFO Sector Diffusion readings: CLIMATE</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol"> CLIMATE Sum</td>
<td> Current</td>
<td> Last Mo</td>
<td colspan="6"> Since Jan 1991*</td>
</tr>
<tr>
<td class="firstcol">&nbsp;</td>
<td> May-09</td>
<td> Apr-09</td>
<td> average</td>
<td> Median</td>
<td> Max</td>
<td> Min</td>
<td> range</td>
<td> % range</td>
</tr>
<tr class="odd">
<td class="firstcol"> All Sectors</td>
<td> -32.1</td>
<td> -33.1</td>
<td>-9.0</td>
<td>-9.6</td>
<td>17.5</td>
<td>-36.2</td>
<td>53.7</td>
<td> 7.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">MFG</td>
<td> -38.0</td>
<td> -38.0</td>
<td>-1.5</td>
<td>0.2</td>
<td>27.5</td>
<td>-42.9</td>
<td>70.4</td>
<td> 7.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">Construction</td>
<td> -26.3</td>
<td> -24.3</td>
<td>-29.0</td>
<td>-30.3</td>
<td>0.7</td>
<td>-50.1</td>
<td>50.8</td>
<td> 46.9%</td>
</tr>
<tr class="odd">
<td class="firstcol">Wholesale</td>
<td> -28.3</td>
<td> -30.6</td>
<td>-14.4</td>
<td>-16.0</td>
<td>23.9</td>
<td>-39.0</td>
<td>62.9</td>
<td> 17.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">Retail</td>
<td> -21.2</td>
<td> -26.5</td>
<td>-15.6</td>
<td>-15.0</td>
<td>19.2</td>
<td>-40.2</td>
<td>59.4</td>
<td> 32.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">Services</td>
<td> -5.0</td>
<td> -7.0</td>
<td>11.0</td>
<td>9.5</td>
<td>28.5</td>
<td>-14.5</td>
<td>43.0</td>
<td> 22.1%</td>
</tr>
</tbody>
</table>
</body></html>

IFO improves, barely -- The IFO survey is in the same boat as the rest of the recent economic indicators. The index is off its low, and rising but still showing contraction. The improvement in May continued but was very slight for [...]

IFO Shows Sector Indices Have Bottomed...Maybe

IFO Shows Sector Indices HaveBottomed...Maybe

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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 src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090520d.jpg" align="left" border="0" height="265" width="353">
Japan is being lead lower by its trade dependence as much as
any large developed country. Exports are lower at a 70% annual rate Q/Q
and by 37% Yr/Yr. Imports meanwhile are dropping at a lesser but still
outsized 47% annual rate in q1 and are off by nearly 15% Yr/Yr. 
 

Japan&#8217;s import to GDP ratio has fallen by 6.2% Yr/Yr less than
in the US where that ratio has fallen by a huge 14%. But exports are a
much larger part of Japan&#8217;s economy, so the drop has hurt it more.
Import-to-GDP ratios have fallen sharply among the large developed
economies in general. 
 

Japan&#8217;s GDP drop at 15.2% Q/Q saar outstrips Germany&#8217;s drop of
14.4% and its Yr/Yr decline of 9.1% exceeds Germany&#8217;s 6.9%. It is no
coincidence that these large set backs -- the largest among G-7
countries by a long shot -- befall two of the most highly efficient
global economies that also are highly dependent on trade. 
 

Trade tends to be a highly income elastic GDP component.
Export and import growth rates are pro-cyclical. In good times trade
dependence will help to pump-up GDP growth, but in bad times
&#8211;recessions - it will drag it down as it is now. In the US, since it is
a trade deficit county, the trade setback actually boosts GDP. What we
are seeing in Japan is the mirror image of that relationship. 
 

In Japan domestic demand is down by less than GDP itself. But
housing and business capital formation are each down at a more rapid
pace than GDP. Japan will need world trade to recover before it can
mend its economy. Its economic structure means that some of its
required fixing it out of its control. 



<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr><th colspan="11" scope="col">Japan GDP </th>
</tr>
</thead>
<tbody>
<tr class="even">
<td class="firstcol" colspan="5">Consumption</td>
<td colspan="3">Capital Formation</td>
<td colspan="3">Trade Domestic</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;</td>
<td>GDP</td>
<td>Private</td>
<td>Public</td>
<td>Gross Fix Cap</td>
<td>Plnt&amp; Equip</td>
<td>Housing</td>
<td>X-M: lbns E</td>
<td>Exports</td>
<td>Imports</td>
<td>Demand</td>
</tr>
<tr>
<td colspan="11" class="firstcol">% change Q/Q at annual
rates of change; X-M is Q/Q change in Blns of real yen</td>
</tr>
<tr class="odd">
<td class="firstcol">Q1-09</td>
<td>-15.2%</td>
<td>-4.2%</td>
<td>1.3%</td>
<td>-27.5%</td>
<td>-35.5%</td>
<td>-20.0%</td>
<td>-11.2</td>
<td>-70.1%</td>
<td>-47.7%</td>
<td>-9.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q4-08</td>
<td>-14.4%</td>
<td>-3.1%</td>
<td>6.4%</td>
<td>-14.6%</td>
<td>-24.2%</td>
<td>23.7%</td>
<td>-15.6</td>
<td>-47.1%</td>
<td>13.1%</td>
<td>-2.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q3-08</td>
<td>-2.5%</td>
<td>0.4%</td>
<td>-0.7%</td>
<td>-9.7%</td>
<td>-16.4%</td>
<td>13.2%</td>
<td>0.0</td>
<td>4.0%</td>
<td>6.3%</td>
<td>-2.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q2-08</td>
<td>-3.5%</td>
<td>-3.8%</td>
<td>-3.1%</td>
<td>-9.5%</td>
<td>-11.2%</td>
<td>-7.7%</td>
<td>1.9</td>
<td>-3.2%</td>
<td>-15.7%</td>
<td>-5.7%</td>
</tr>
<tr>
<td colspan="11" class="firstcol">% change Yr/Yr; X-M is
Yr/Yr change in Gap in Blns of real yen</td>
</tr>
<tr class="odd">
<td class="firstcol">Q1-09</td>
<td>-9.1%</td>
<td>-2.7%</td>
<td>0.9%</td>
<td>-15.7%</td>
<td>-22.4%</td>
<td>0.8%</td>
<td>-24.9</td>
<td>-36.8%</td>
<td>-14.7%</td>
<td>-5.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q4-08</td>
<td>-4.5%</td>
<td>-0.2%</td>
<td>0.2%</td>
<td>-7.8%</td>
<td>-12.0%</td>
<td>11.8%</td>
<td>-13.1</td>
<td>-12.5%</td>
<td>2.8%</td>
<td>-1.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q3-08</td>
<td>-0.2%</td>
<td>0.7%</td>
<td>0.4%</td>
<td>-4.9%</td>
<td>-4.5%</td>
<td>-5.5%</td>
<td>4.0</td>
<td>4.5%</td>
<td>0.1%</td>
<td>-1.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q2-08</td>
<td>0.6%</td>
<td>0.3%</td>
<td>0.1%</td>
<td>-3.6%</td>
<td>0.5%</td>
<td>-16.5%</td>
<td>6.7</td>
<td>6.3%</td>
<td>-2.1%</td>
<td>-0.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">5-Yrs</td>
<td>-0.4%</td>
<td>0.5%</td>
<td>1.2%</td>
<td>-2.8%</td>
<td>-0.7%</td>
<td>-3.5%</td>
<td>na</td>
<td>-2.6%</td>
<td>0.2%</td>
<td>-0.1%</td>
</tr>
</tbody>
</table>
</body></html>

Japan is being lead lower by its trade dependence as much as any large developed country. Exports are lower at a 70% annual rate Q/Q and by 37% Yr/Yr. Imports meanwhile are dropping at a lesser but still outsized 47% annual rate in q1 [...]

Japan GDP In Record Drop As Trade Collapses

<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/090521d.jpg" width="353">
Perhaps foreshadowing economic recovery was a report from the Conference Board showing that the April composite index of leading economic indicators jumped 1.0%. The rise recovered the declines during the prior several months and left the index at its highest level since last November.
Nearly three quarters of the ten components of the leading index increased last month with the largest contributions coming from higher stock prices, improved consumer expectations and a more positively sloped interest rate yield curve.
The leading index is based on actual reports for eight economic data series. The Conference Board initially estimates two series, orders for consumer goods and orders for capital goods.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090521e.jpg" width="353">
Suggesting that the rate of decline in the economy is slowing were the coincident indicators. They fell another 0.2% which was the smallest decline since last July. The negative contributions from lower employment and production eased. Half of the four component series rose during April led by gains in real disposable income and business sales. Over the last ten years there has been a 76% correlation between this y/y change and real GDP.
In a sign that excesses in the U.S. economy are diminishing, the lagging index fell for the fourth month in the last five. The ratio of coincident-to-lagging indicators (a measure of economic excess) rose modestly to the highest level this year.
The Conference Board figures are available in Haver&#39;s BCI database. Visit the Conference Board&#39;s <a href="http://www.conference-board.org">site</a> for coverage of leading indicator series from around the world.

<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/BCI/BCI.HTM">Business Cycle Indicators</a> (%)</th>
<th scope="col">April</th>
<th scope="col">March</th>
<th scope="col">February</th>
<th scope="col">Jan. 6-Month % (AR)</th>
<th scope="col">2008</th>
<th scope="col">2007</th>
<th scope="col">2006</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Leading</td>
<td>1.0</td>
<td>-0.2</td>
<td>-0.5</td>
<td>-1.2</td>
<td>-2.8</td>
<td>-0.3</td>
<td>1.5</td>
</tr>
<tr>
<td class="firstcol">Coincident</td>
<td>-0.2</td>
<td>-0.6</td>
<td>-0.6</td>
<td>-4.9</td>
<td>-0.8</td>
<td>1.6</td>
<td>2.5</td>
</tr>
<tr class="odd">
<td class="firstcol">Lagging</td>
<td>-0.5</td>
<td>-0.5</td>
<td>-0.6</td>
<td>-1.9</td>
<td>2.9</td>
<td>2.8</td>
<td>3.3</td>
</tr>
</tbody>
</table>


</html>

Perhaps foreshadowing economic recovery was a report from the Conference Board showing that the April composite index of leading economic indicators jumped 1.0%. The rise recovered the declines during the prior several months and left [...]

U.S. Leading Indicators Improve Sharply To The Highest Level Since November

<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/090521f.jpg" width="353">
The Philadelphia Federal Reserve Bank indicated that economic activity in the region continued to contract during May but that the rate of decline slowed. The Index of General Business conditions in the manufacturing sector came in at -22.6 which was the least negative reading since last September. The latest figure, nonetheless, was weaker than an expected reading of -18.
Though the latest figure remained negative it indicates that the decline in economic activity is moderating. During the last ten years there has been a 77% correlation between the level of the Philadelphia Fed Business Conditions Index and the three-month growth in factory sector industrial production. There has been a 68% correlation with q/q growth in real GDP.
The Philadelphia Fed constructs a diffusion index for total business activity and each of the sub-indexes. The business conditions index reflects a separate survey question.
Amongst the sub-indexes shipments, inventories and unfilled orders rose. The new orders index fell slightly, however, and has been moving erratically sideways this year. Showing much improvement was the employment index which rose significantly to the highest level since last November. A reduced thirty-four percent of respondents expected to lower employment levels and an improved eight percent expected to raise them. During the last ten years there has been a 79% correlation between the index level and the m/m change in manufacturing sector payrolls.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090521g.jpg" width="353">
The prices paid index remained low at -22.8. Only one percent of respondents planned to raise prices while twenty-four percent expected to lower them. During the last ten years there has been a 74% correlation between the prices paid index and the three-month growth in the intermediate goods PPI. There has been an 83% correlation with the change in core intermediate goods prices.
The separate index of expected business conditions in six months improved to its highest level since 2004. The expectations index for new orders, shipments and employment surged.
The figures from the Philadelphia Federal Reserve can be found in Haver&#39;s SURVEYS database.
The latest Business Outlook Survey from the Federal Reserve Bank of Philadelphia can be found <a href="http://www.philadelphiafed.org/research-and-data/regional-economy/business-outlook-survey/2009/bos0509.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">Philadelphia Fed (%)</th>
<th scope="col">May</th>
<th scope="col">April</th>
<th scope="col">May&nbsp; &#39;08</th>
<th scope="col">2008</th>
<th scope="col">2007</th>
<th scope="col">2006</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">General Activity Index</td>
<td>-22.6</td>
<td>-24.4</td>
<td>-16.3</td>
<td>-21.3</td>
<td>5.0</td>
<td>8.0</td>
</tr>
<tr>
<td class="firstcol">Prices Paid Index</td>
<td>-22.8</td>
<td>&nbsp;-31.5</td>
<td>&nbsp;52.2</td>
<td>36.4</td>
<td>26.3</td>
<td>36.7</td>
</tr>
</tbody>
</table>
</body>
</html>

The Philadelphia Federal Reserve Bank indicated that economic activity in the region continued to contract during May but that the rate of decline slowed. The Index of General Business conditions in the manufacturing sector came in at [...]

Philadelphia Fed Index Indicates A Slowing Rate Of Decline In Economic Activity

<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/090521a.jpg" width="353">
Job creation remains unambiguously weak even as the latest figures on U.S. initial claims gave another indication of tenuous improvement. Jobs weakness is evident in continuing claims for unemployment insurance, which provide an indication of workers&#39; ability to find employment. Signaling greater inability to secure work, they increased to another record high of 6,662,000, more than twice the year ago level. The series dates back to 1966. Further indicating that the job market remains weak, the four-week average of continuing claims also rose to another record of 6,480,500.
The lack of hiring continued to push the insured unemployment rate higher to 5.0%. That level was more than double last April and the highest level since 1983. During the last ten years there has been a 93% correlation between the level of the insured unemployment rate and the overall rate of unemployment published by the Bureau of Labor Statistics.Clearly, the latest weekly figure understates labor market distress in some states. The highest insured unemployment rates in the week ending May 2 were in Oregon (7.4 percent), Michigan (6.9), Puerto Rico (6.6), Nevada (6.4), Pennsylvania (6.3), Wisconsin (6.2), Idaho (6.0), California (5.6), Alaska (5.5), New Jersey (5.4), and North Carolina (5.4).
A sign of tenuous improvement in the labor market was the fall in initial claims for unemployment insurance, down a modest 12,000 to 631,000. That followed an upwardly revised gain during the prior week. Though still relatively high, initial claims are down from their March high of 674,000. The four-week average of claims, which smoothes out some of the volatility in the weekly numbers, ticked down to 628,500, still near the lowest level since mid-February. The Consensus expectation was for 630,000 claims last week.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090521b.jpg" width="353">
The Labor Department indicated that the largest increases in initial claims for the week ending May 9 were in Michigan (+16,817), North Carolina (+3,783), Virginia (+2,871), Kentucky (+2,768), and Pennsylvania (+2,444), while the largest decreases were in California (-10,052), Wisconsin (-1,691), Kansas (-1,415), Oklahoma (-1,084), and Washington (-843).
The latest initial claims figures cover the survey week for May nonfarm payrolls and claims fell 14,000 (-2.2%) from the April survey period. For April, a modest increase in initial claims was accompanied by a 539,000 decline in nonfarm payrolls. During the last ten tears there has been an 87% negative correlation between the level of initial claims and the change in nonfarm payrolls.
The unemployment insurance claims data is available in Haver&#39;s WEEKLY database.
The minutes from the latest meeting of the Federal Open Market Committee are available <a href="http://www.federalreserve.gov/newsevents/press/monetary/20090520a.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/WEEKLY/@W5/@W507/@W507.HTM">Unemployment Insurance (000s)</a>&nbsp;</th>
<th scope="col">05/16/09</th>
<th scope="col">05/09/09</th>
<th scope="col">05/02/09</th>
<th scope="col">Y/Y</th>
<th scope="col">2008</th>
<th scope="col">2007</th>
<th scope="col">2006&nbsp;</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Initial Claims</td>
<td>631</td>
<td>643</td>
<td>605</td>
<td>68.7%</td>
<td>420</td>
<td>321</td>
<td>313</td>
</tr>
<tr>
<td class="firstcol">Continuing Claims</td>
<td>--</td>
<td>6,662</td>
<td>6,587</td>
<td>117.6%</td>
<td>3,342</td>
<td>2,552</td>
<td>2,459</td>
</tr>
</tbody>
</table>
</body>
</html>

Job creation remains unambiguously weak even as the latest figures on U.S. initial claims gave another indication of tenuous improvement. Jobs weakness is evident in continuing claims for unemployment insurance, which provide an [...]

U.S. Continuing Claims For Unemployment Insurance Reach Another Record While Initial Claims Dip

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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 src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090521d.jpg" align="left" border="0" height="265" width="353">
Perhaps foreshadowing economic recovery was a report from the
Conference Board showing that the April composite index of leading
economic indicators jumped 1.0%. The rise recovered the declines during
the prior several months and left the index at its highest level since
last November.
Nearly three quarters of the ten components of the leading
index increased last month with the largest contributions coming from
higher stock prices, improved consumer expectations and a more
positively sloped interest rate yield curve.
The leading index is based on actual reports for eight
economic data series. The Conference Board initially estimates two
series, orders for consumer goods and orders for capital goods.<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090521e.jpg" align="right" border="0" height="265" width="353">
Suggesting that the rate of decline in the economy is slowing
were the coincident indicators. They fell another 0.2% which was the
smallest decline since last July. The negative contributions from lower
employment and production eased. Half of the four component series rose
during April led by gains in real disposable income and business sales.
Over the last ten years there has been a 76% correlation between this
y/y change and real GDP.
In a sign that excesses in the U.S. economy are diminishing,
the lagging index fell for the fourth month in the last five. The ratio
of coincident-to-lagging indicators (a measure of economic excess) rose
modestly to the highest level this year.
The Conference Board figures are available in Haver's BCI
database. Visit the Conference Board's <a href="http://www.conference-board.org">site</a> for
coverage of leading indicator series from around the world.


<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/BCI/BCI.HTM">Business
Cycle Indicators</a> (%)</th>
<th scope="col">April</th>
<th scope="col">March</th>
<th scope="col">February</th>
<th scope="col">Jan. 6-Month % (AR)</th>
<th scope="col">2008</th>
<th scope="col">2007</th>
<th scope="col">2006</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Leading</td>
<td>1.0</td>
<td>-0.2</td>
<td>-0.5</td>
<td>-1.2</td>
<td>-2.8</td>
<td>-0.3</td>
<td>1.5</td>
</tr>
<tr>
<td class="firstcol">Coincident</td>
<td>-0.2</td>
<td>-0.6</td>
<td>-0.6</td>
<td>-4.9</td>
<td>-0.8</td>
<td>1.6</td>
<td>2.5</td>
</tr>
<tr class="odd">
<td class="firstcol">Lagging</td>
<td>-0.5</td>
<td>-0.5</td>
<td>-0.6</td>
<td>-1.9</td>
<td>2.9</td>
<td>2.8</td>
<td>3.3</td>
</tr>
</tbody>
</table>
Philadelphia Fed Index Indicates A
Slowing Rate Of Decline In Economic Activity 
by <a href="/comment/Moeller.html">Tom
Moeller</a> May 21, 2009


<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090521f.jpg" align="left" border="0" height="265" width="353">
The Philadelphia Federal Reserve Bank indicated that economic
activity in the region continued to contract during May but that the
rate of decline slowed. The Index of General Business conditions in the
manufacturing sector came in at -22.6 which was the least negative
reading since last September. The latest figure, nonetheless, was
weaker than an expected reading of -18.
Though the latest figure remained negative it indicates that
the decline in economic activity is moderating. During the last ten
years there has been a 77% correlation between the level of the
Philadelphia Fed Business Conditions Index and the three-month growth
in factory sector industrial production. There has been a 68%
correlation with q/q growth in real GDP.
The Philadelphia Fed constructs a diffusion index for total
business activity and each of the sub-indexes. The business conditions
index reflects a separate survey question.
Amongst the sub-indexes shipments, inventories and unfilled
orders rose. The new orders index fell slightly, however, and has been
moving erratically sideways this year. Showing much improvement was the
employment index which rose significantly to the highest level since
last November. A reduced thirty-four percent of respondents expected to
lower employment levels and an improved eight percent expected to raise
them. During the last ten years there has been a 79% correlation
between the index level and the m/m change in manufacturing sector
payrolls.<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090521g.jpg" align="right" border="0" height="265" width="353">
The prices paid index remained low at -22.8. Only one percent
of respondents planned to raise prices while twenty-four percent
expected to lower them. During the last ten years there has been a 74%
correlation between the prices paid index and the three-month growth in
the intermediate goods PPI. There has been an 83% correlation with the
change in core intermediate goods prices.
The separate index of expected business conditions in six
months improved to its highest level since 2004. The expectations index
for new orders, shipments and employment surged.
The figures from the Philadelphia Federal Reserve can be found
in Haver's SURVEYS database.
The latest Business Outlook Survey from the Federal
Reserve Bank of Philadelphia can be found <a href="http://www.philadelphiafed.org/research-and-data/regional-economy/business-outlook-survey/2009/bos0509.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">Philadelphia
Fed (%)</th>
<th scope="col">May</th>
<th scope="col">April</th>
<th scope="col">May&nbsp; '08</th>
<th scope="col">2008</th>
<th scope="col">2007</th>
<th scope="col">2006</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">General Activity Index</td>
<td>-22.6</td>
<td>-24.4</td>
<td>-16.3</td>
<td>-21.3</td>
<td>5.0</td>
<td>8.0</td>
</tr>
<tr>
<td class="firstcol">Prices Paid Index</td>
<td>-22.8</td>
<td>&nbsp;-31.5</td>
<td>&nbsp;52.2</td>
<td>36.4</td>
<td>26.3</td>
<td>36.7</td>
</tr>
</tbody>
</table>
U.S. Continuing Claims For
Unemployment Insurance Reach Another Record While Initial Claims Dip 
by <a href="/comment/Moeller.html">Tom
Moeller</a> May 21, 2009


<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090521a.jpg" align="left" border="0" height="265" width="353">
Job creation remains unambiguously weak even as the latest
figures on U.S. initial claims gave another indication of tenuous
improvement. Jobs weakness is evident in continuing claims for
unemployment insurance, which provide an indication of workers' ability
to find employment. Signaling greater inability to secure work, they
increased to another record high of 6,662,000, more than
twice the year ago level. The series dates back to 1966.
Further indicating that the job market remains weak, the four-week
average of continuing claims also rose to another record of 6,480,500.
The lack of hiring continued to push the insured unemployment
rate higher to 5.0%. That level was more than double last April and the
highest level since 1983. During the last ten years there has been a
93% correlation between the level of the insured unemployment rate and
the overall rate of unemployment published by the Bureau of Labor
Statistics.Clearly, the latest weekly figure understates labor market
distress in some states. The highest insured unemployment rates in the
week ending May 2 were in Oregon (7.4 percent), Michigan (6.9), Puerto
Rico (6.6), Nevada (6.4), Pennsylvania (6.3), Wisconsin (6.2), Idaho
(6.0), California (5.6), Alaska (5.5), New Jersey (5.4), and North
Carolina (5.4).
A sign of tenuous improvement in the labor market was the fall
in initial claims for unemployment insurance, down a modest 12,000 to
631,000. That followed an upwardly revised gain during the prior week.
Though still relatively high, initial claims are down from their March
high of 674,000. The four-week average of claims, which smoothes out
some of the volatility in the weekly numbers, ticked down to 628,500,
still near the lowest level since mid-February. The Consensus
expectation was for 630,000 claims last week.<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090521b.jpg" align="right" border="0" height="265" width="353">
The Labor Department indicated that the largest increases in
initial claims for the week ending May 9 were in Michigan (+16,817),
North Carolina (+3,783), Virginia (+2,871), Kentucky (+2,768), and
Pennsylvania (+2,444), while the largest decreases were in California
(-10,052), Wisconsin (-1,691), Kansas (-1,415), Oklahoma (-1,084), and
Washington (-843).
The latest initial claims figures cover the survey week for
May nonfarm payrolls and claims fell 14,000 (-2.2%) from the April
survey period. For April, a modest increase in initial claims was
accompanied by a 539,000 decline in nonfarm payrolls. During the last
ten tears there has been an 87% negative correlation between the level
of initial claims and the change in nonfarm payrolls.
The unemployment insurance claims data is available in Haver's
WEEKLY database.
The minutes from the latest meeting of the Federal
Open Market Committee are available <a href="http://www.federalreserve.gov/newsevents/press/monetary/20090520a.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/WEEKLY/@W5/@W507/@W507.HTM">Unemployment
Insurance (000s)</a>&nbsp;</th>
<th scope="col">05/16/09</th>
<th scope="col">05/09/09</th>
<th scope="col">05/02/09</th>
<th scope="col">Y/Y</th>
<th scope="col">2008</th>
<th scope="col">2007</th>
<th scope="col">2006&nbsp;</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Initial Claims</td>
<td>631</td>
<td>643</td>
<td>605</td>
<td>68.7%</td>
<td>420</td>
<td>321</td>
<td>313</td>
</tr>
<tr>
<td class="firstcol">Continuing Claims</td>
<td>--</td>
<td>6,662</td>
<td>6,587</td>
<td>117.6%</td>
<td>3,342</td>
<td>2,552</td>
<td>2,459</td>
</tr>
</tbody>
</table>
Japan GDP In Record Drop As Trade
Collapses&nbsp; 
by <a href="/comment/Brusca.html">Robert
Brusca&nbsp;</a> May 21, 2009


<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/090520d.jpg" align="left" border="0" height="265" width="353">
Japan is being lead lower by its trade dependence as much as
any large developed country. Exports are lower at a 70% annual rate Q/Q
and by 37% Yr/Yr. Imports meanwhile are dropping at a lesser but still
outsized 47% annual rate in q1 and are off by nearly 15% Yr/Yr. 
 

Japan&#8217;s import to GDP ratio has fallen by 6.2% Yr/Yr less than
in the US where that ratio has fallen by a huge 14%. But exports are a
much larger part of Japan&#8217;s economy, so the drop has hurt it more.
Import-to-GDP ratios have fallen sharply among the large developed
economies in general. 
 

Japan&#8217;s GDP drop at 15.2% Q/Q saar outstrips Germany&#8217;s drop of
14.4% and its Yr/Yr decline of 9.1% exceeds Germany&#8217;s 6.9%. It is no
coincidence that these large set backs -- the largest among G-7
countries by a long shot -- befall two of the most highly efficient
global economies that also are highly dependent on trade. 
 

Trade tends to be a highly income elastic GDP component.
Export and import growth rates are pro-cyclical. In good times trade
dependence will help to pump-up GDP growth, but in bad times
&#8211;recessions - it will drag it down as it is now. In the US, since it is
a trade deficit county, the trade setback actually boosts GDP. What we
are seeing in Japan is the mirror image of that relationship. 
 

In Japan domestic demand is down by less than GDP itself. But
housing and business capital formation are each down at a more rapid
pace than GDP. Japan will need world trade to recover before it can
mend its economy. Its economic structure means that some of its
required fixing it out of its control. 


<table border="0" cellspacing="0" width="100%"> <colgroup></colgroup>
<thead><tr>
<th colspan="11" scope="col">Japan
GDP </th>
</tr>
</thead>
<tbody>
<tr class="even">
<td class="firstcol" colspan="5">Consumption</td>
<td colspan="3">Capital
Formation</td>
<td colspan="3">Trade Domestic</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;</td>
<td>GDP</td>
<td>Private</td>
<td>Public</td>
<td>Gross 
Fix Cap</td>
<td>Plnt&amp; 
Equip</td>
<td>Housing</td>
<td>X-M: 
lbns E</td>
<td>Exports</td>
<td>Imports</td>
<td>Demand</td>
</tr>
<tr>
<td colspan="11" class="firstcol">% change Q/Q at
annual
rates of change; X-M is Q/Q change in Blns of real yen</td>
</tr>
<tr class="odd">
<td class="firstcol">Q1-09</td>
<td>-15.2%</td>
<td>-4.2%</td>
<td>1.3%</td>
<td>-27.5%</td>
<td>-35.5%</td>
<td>-20.0%</td>
<td>-11.2</td>
<td>-70.1%</td>
<td>-47.7%</td>
<td>-9.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q4-08</td>
<td>-14.4%</td>
<td>-3.1%</td>
<td>6.4%</td>
<td>-14.6%</td>
<td>-24.2%</td>
<td>23.7%</td>
<td>-15.6</td>
<td>-47.1%</td>
<td>13.1%</td>
<td>-2.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q3-08</td>
<td>-2.5%</td>
<td>0.4%</td>
<td>-0.7%</td>
<td>-9.7%</td>
<td>-16.4%</td>
<td>13.2%</td>
<td>0.0</td>
<td>4.0%</td>
<td>6.3%</td>
<td>-2.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q2-08</td>
<td>-3.5%</td>
<td>-3.8%</td>
<td>-3.1%</td>
<td>-9.5%</td>
<td>-11.2%</td>
<td>-7.7%</td>
<td>1.9</td>
<td>-3.2%</td>
<td>-15.7%</td>
<td>-5.7%</td>
</tr>
<tr>
<td colspan="11" class="firstcol">% change Yr/Yr; X-M
is
Yr/Yr change in Gap in Blns of real yen</td>
</tr>
<tr class="odd">
<td class="firstcol">Q1-09</td>
<td>-9.1%</td>
<td>-2.7%</td>
<td>0.9%</td>
<td>-15.7%</td>
<td>-22.4%</td>
<td>0.8%</td>
<td>-24.9</td>
<td>-36.8%</td>
<td>-14.7%</td>
<td>-5.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q4-08</td>
<td>-4.5%</td>
<td>-0.2%</td>
<td>0.2%</td>
<td>-7.8%</td>
<td>-12.0%</td>
<td>11.8%</td>
<td>-13.1</td>
<td>-12.5%</td>
<td>2.8%</td>
<td>-1.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q3-08</td>
<td>-0.2%</td>
<td>0.7%</td>
<td>0.4%</td>
<td>-4.9%</td>
<td>-4.5%</td>
<td>-5.5%</td>
<td>4.0</td>
<td>4.5%</td>
<td>0.1%</td>
<td>-1.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">Q2-08</td>
<td>0.6%</td>
<td>0.3%</td>
<td>0.1%</td>
<td>-3.6%</td>
<td>0.5%</td>
<td>-16.5%</td>
<td>6.7</td>
<td>6.3%</td>
<td>-2.1%</td>
<td>-0.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">5-Yrs</td>
<td>-0.4%</td>
<td>0.5%</td>
<td>1.2%</td>
<td>-2.8%</td>
<td>-0.7%</td>
<td>-3.5%</td>
<td>na</td>
<td>-2.6%</td>
<td>0.2%</td>
<td>-0.1%</td>
</tr>
</tbody>
</table>
</body></html>

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

Underperforming German economy generating increased policy uncertainty relative to Europe and the US

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

250430N1.jpg

250430O1.jpg

Real GDP eased 0.3% SAAR (+2.1% y/y) during the first quarter of 2025 after increasing 2.4% in Q4’24 and 3.1% in Q3’24. A 0.4% increase had been expected in the Action Economics Forecast Survey. It was the first decline since Q1 2022.

Foreign trade subtracted 4.83 percentage points from growth last quarter as imports surged 41.3% (13.4% y/y) ahead of tariffs, which began to come into effect in the first quarter. The rise followed a 1.9% decline in Q4’24. Exports rose 1.8% (3.0% y/y) after easing 0.2% in Q4. Inventories added 2.25 percentage points to growth after subtracting 0.84 percentage point from Q4 growth.

Real final sales to domestic purchasers grew 2.3% (2.9% y/y) in Q1 after rising 3.0% in Q4. Personal consumption expenditures rose 1.8% (3.1% y/y) following a 4.0% gain. Durable goods spending fell 3.4% (+5.3% y/y) after surging 12.4% in Q4. Motor vehicle purchases declined 11.1% (+5.5% y/y) after strengthening 19.7% in Q4. Spending on home furnishings & appliances gained 1.5% (6.1% y/y) following a 5.4% rise. Recreational goods & vehicle outlays rose 2.5% (7.0% y/y) last quarter after a 13.9% Q4 increase.

Nondurable goods outlays rose 2.7% (3.0% y/y) following 3.1% growth in Q4. Apparel spending increased 6.7% (2.5% y/y) following a 5.0% rise. Food & beverage buying gained 2.5% (2.3% y/y) after a 1.8% increase. Gasoline & fuel oil purchases increased 4.6% (3.4% y/y) after falling 2.0% in Q4.

Spending on services increased 2.4% last quarter (2.7% y/y) after a 3.0% gain. Outlays on housing & utilities increased 3.4% (1.8% y/y) after rising 1.1% in Q4. Health care expenditures rose 4.0% (4.8% y/y) following a 4.7% strengthening. Transportation outlays increased 5.3% (4.6% y/y) after a 3.7% rise while recreation spending rose 4.7% (2.8% y/y) following a 4.5% rise. Restaurant & hotel expenditures declined 2.1% (+0.5% y/y) following a 2.8% rise. Financial services expenditures rose 1.9% (2.0% y/y) after a 3.1% Q4 increase.

Business fixed investment increased 9.8% (3.6% y/y) following a 3.0% decline in Q4. Expenditures on structures rose 0.4% (-0.4% y/y) after a 2.9% increase. Expenditures on producers’ durable equipment jumped 22.5% (8.0% y/y) after falling 8.7%.  Outlays on information processing equipment soared 69.3% (18.9% y/y) following a 7.3% decline. Industrial equipment investment fell 1.4% (-0.3% y/y) after easing 0.9%. Intellectual property product spending rose 4.1% (1.8% y/y) following a 0.5% decline. 

Residential structures investment increased 1.3% (-0.1% y/y) in Q1 after a 5.5% Q4 rise.

250430P1.jpg

250430Q1.jpg

Government spending fell 1.5% (+2.4% y/y) after a 3.1% Q4 rise. Federal government expenditures declined 5.1% (+2.9% y/y) after rising 4.0% in Q4. National defense expenditures declined 8.0% (+4.0% y/y) after increasing 4.8% in Q4. State & local government spending rose 0.8% (2.1% y/y) following a 2.5% rise.

The GDP price index rose 3.7% (2.6% y/y) after increasing 2.3% in Q4. It was the largest increase since Q4’22. A 2.4% increase had been expected. The PCE chain price index increased 3.6% (2.5% y/y) following a 2.4% rise. The PCE price index excluding food and energy rose 3.5% (2.8% y/y) after increasing 2.6% in Q4. The business fixed investment price index rose 0.4% (1.8% y/y) after 1.5% rise. The residential price index strengthened 3.9% (3.2% y/y) after a 1.9% rise while the government price index increased 4.7% (2.8% y/y) following a 2.1% rise.

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

250430R1.jpg

250430S1.jpg

- Decline in GDP is first in three years.
- Foreign trade subtracts substantially ahead of tariffs.
- Domestic final demand growth weakens.
- Price index strengthens with higher core PCE prices.

U.S. GDP Unexpectedly Declines in Q1’25; Prices Strengthen

Michael J. Moran

250430A.jpg

250430B.jpg

High-side readings on the price indexes for personal consumption expenditures in January and February caused some concern about emerging price pressure, especially with some policies of the Trump administration possibly adding to the upward force. However, March brought notable relief, with the headline price index falling slightly (-0.04%). A marked decline in energy prices was helpful (-2.7%), but core prices also were subdued, increasing less than 0.1%.  Year-over-year changes were still above the Fed’s target of 2%, but only barely so for the headline measure (2.3%). The core index backed away from the reading of 3.0% in February, but the latest reading of 2.7% was in line with observations in the past year, and still uncomfortably above target.

Consumers roused from a winter slumber in March, with nominal outlays increasing 0.7%. With inflation restrained, real outlays also posted a gain of 0.7%. Spending on durable gods stood out, with real outlays advancing 3.2%. Real outlays for both nondurable goods and services rose 0.4%, a solid pace. Signs of life were certainly welcome after an average decline of 0.1% in January and February. The March rebound left growth of 1.8% (annual rate) in the first quarter.

The brisk increase in spending in March was supported by a solid gain in personal income (0.5% in both nominal and real terms). Growth in wage income was firm at 0.5%, while proprietors’ income was robust with a gain of 1.8% (not annualized!). The farm sector led the advance in proprietors’ income, but the nonfarm sector also was strong (0.6%).

The personal income and consumption figures are available in Haver’s **USECON** database with detail in the **USNA** database. The Action Economics forecasts are in **AS1REPNA**.

250430C.jpg

250430D.jpg

- Price pressure eases.
- Spending rebounds after two soft months.

Personal Income, Consumption, and Prices in March

250430F20.jpg

250430G20.jpg

The Pending Home Sales Index, a forward-looking home sales measure based on contract signings, from the National Association of Realtors rose 6.1% to 76.5 (-0.6% y/y) during March after rising a little-revised 2.1% in February. These changes followed a 4.6% January decline.

The rise in March sales occurred as the rate on a 30-year mortgage eased to an average 6.65% from 6.84% in February. This rate was well above a low of 2.68% averaged in December 2020.

Pending home sales were up in most regions of the country. Sales in the Midwest rose 4.9% (1.4% y/y) last month after rising 1.8% in February. Sales in the South increased 9.8% (-0.4% y/y) following a 5.8% February rise. Sales in the West improved 4.8% (-2.0% y/y) after falling 3.0% in February. Sales in the Northeast were off 0.5% (-3.0% y/y) in March after falling 0.9% in February.

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

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

- Sales rise to highest level in four months.
- Strength is evident throughout most of country.

U.S. Pending Home Sales Surge in March

Sandy Batten

250430F5.jpg

250430G5.jpg

The employment cost index (ECI) for civilian workers, arguably the most accurate measure of labor compensation in the United States, rose 0.9% q/q (3.6% y/y) in Q1, the same quarterly increase as in last year’s Q4, according to the Bureau of Labor Statistics. The quarterly gains have fluctuated between 0.8% and 1.0% for the past six quarters. The Action Economics Forecast Survey had expected a 0.9% q/q increase and a 3.5% y/y gain.

Wages and salaries for civilian workers rose 0.8% q/q (3.5% y/y) in Q1, down from 1.0% q/q in Q4. This tied the Q3 2024 quarterly rise as the smallest increase since Q2 2021. It was also the smallest y/y increase since Q2 2021. Benefits increased by an outsized 1.2% q/q (3.9% y/y) in Q1 versus 0.8% q/q in Q4. This is the largest quarterly gain since Q2 2022. In general, employment cost gains remain above the pace observed prior to the pandemic but are slowing gradually.

Private industry workers’ compensation rose 0.8% q/q (3.4% y/y) in Q1, down from 0.9% q/q (3.6% y/y) in Q4. Wages and salaries for private industry workers increased 0.8% q/q (3.4% y/y) in Q1 versus 0.8% q/q (3.7% y/y) in Q4. The quarterly gain in Q1 tied that in Q3 2024 as the smallest increase since Q4 2020. Benefits for private industry workers jumped 1.2% q/q (3.6% y/y). the largest quarterly gain since Q2 2022. The acceleration in benefits in Q1 was primarily in service-producing industries.

Compensation in private goods-producing industries increased 1.0% q/q (3.2% y/y) in Q1, the largest quarterly gain in five quarters, versus a 0.7% q/q increase in Q4. Compensation in construction jumped 1.3% q/q, its largest quarterly increase since Q2 2022, up from a 0.6% q/q gain in Q4. Manufacturing compensation growth slowed to 0.7% q/q, its slowest quarterly advance since Q4 2020, from 0.8% q/q in Q4. Compensation in private service-producing industries increased 0.8% q/q (3.5% y/y), down slightly from a 0.9% q/q gain in Q4. Compensation in education and health services jumped 1.3% q/q, its largest quarterly gain since Q3 2023. In contrast, compensation in other services edged up 0.1% q/q in Q1, its smallest quarterly advance since before the pandemic.

The employment cost index measures the change in the cost of labor, free from the influence of employment shifts across occupations and industries. It is provided by the Bureau of Labor Statistics and is available in Haver’s **USECON** database. Consensus estimates from the Action Economics Forecast Survey are in Haver’s **AS1REPNA** database.

250430H5.jpg

250430I5.jpg

- Compensation grew 0.9 q/q in Q1, the same pace as in Q4.
- Wage growth slowed to 0.8% q/q while benefits surged 1.2% q/q, their largest quarterly increase since Q2 2022.

Employment Cost Growth Steady in Q1 2025

Kathleen Stephansen, CBE

250430J4.jpg

250430K4.jpg

The ADP National Employment Report indicated that nonfarm private sector payrolls rose 62,000 (1.4% y/y) during April after increasing 147,000 (1.4% y/y) during March, revised from 155,000. A 124,000 April rise in ADP employment had been expected in the Action Economics Forecast Survey.

Growth in median annual pay for "job stayers" eased to 4.5% y/y during April, from 4.6% y/y in March and from 4.7% y/y in the prior two months. Manufacturing sector pay grew 4.6% y/y during April, down from 4.8% y/y in March. Construction sector pay was unchanged at 4.7% y/y. Natural resource & mining sector pay grew 4.4% y/y. Financial sector pay rose 5.1% y/y, while education & health services pay rose 4.7% y/y. Leisure & hospitality pay also increased 4.7% y/y. Professional & business service sector pay increased 4.3% y/y as did trade, transportation & utilities pay. Information pay rose 4.1% y/y. Median annual pay for “job changers” rose 6.9% y/y after 6.7% y/y in March.

Small business hiring (less than 50 employees) rose 11,000 (0.6% y/y) after rising 18,000 (0.6% y/y) in March, revised down from 52,000. Employment at medium-sized firms (50-499,000 employees) rose 40,000 (1.1% y/y) after rising 43,000 (1.1% y/y). Large business hiring (500+ employees) rose 12,000 (3.4% y/y) in April, after rising 61,000 (3.6% y/y) in March, revised from 59,000.

Goods-producing employment rose 26,000 (1.3% y/y) in April, after rising 16,000 (1.3% y/y) during March, revised from 24,000. Manufacturing jobs rose 4,000 (-0.2% y/y) after rising 17,000 (-0.3% y/y) in March. The number of construction sector jobs rose 16,000 (3.4% y/y) in April, following a 2,000 (3.6% y/y) March increase, revised from 6,000. Natural resources & mining jobs rose 6,000 (2.8% y/y) in April after falling 3,000 (+1.9% y/y) in March.

The number of service-producing jobs rose 34,000 (1.4% y/y) during April, following a rise of 131,000 (1.4% y/y) in March. Professional & business services employment fell 2,000 (0.6% y/y) after rising 46,000 (0.7% y/y) in the prior month, revised from 57,000. Employment in the financial industry rose 20,000 (2.1% y/y) in April, after rising 38,000 (2.0% y/y) in March. Leisure and hospitality employment increased 27,000 (3.0% y/y), following a 23,000 (2.9% y/y) March increase, revised from 17,000. The number of education & health care jobs fell 23,000 (1.6% y/y) in April, following a 15,000 (1.8% y/y) rise in March, revised from 12,000. Information sector employment fell 8,000 (-0.1% y/y) after a rise of 3,000 (0.2% y/y) in March. The number of jobs in trade, transportation & utilities rose 21,000 (0.4% y/y) in April, after falling 4,000 (+0.4% y/y) in March, revised from a 6,000 fall. Employment in “other” services rose fell 1,000 (+3.2% y/y) following a 10,000 (3.4% y/y) rise in March, revised from 11,000.

By region, employment in the Northeast increased 10,000 (1.9% y/y) in April, following an increase of 95,000 (2.0% y/y) in March, revised from 89,000. Employment in the Midwest rose 42,000 (1.5% y/y) after a gain of 84,000 (1.4% y/y) in March, revised from 81,000. In the South, employment rose 3,000 (1.3% y/y) during April, after rising 10,000 (1.4% y/y) in March, revised from 27,000. In the West, employment rose 9,000 (0.6% y/y) after declining 43,000 (+0.6% y/y), revised from a 41,000 decline in March.

The ADP National Employment Report and Pay Insights data can be found in Haver's **USECON** database. Historical figures date back to January 2010 for private employment. Pay data date back to October 2020. The expectation figure is available in Haver's **AS1REPNA** database.

250430L4.jpg

250430M4.jpg

- Employment increase is modest in both services & factory sectors.
- Wage growth for “job stayers” moderates.
- Small and medium-sized business employment slows.

Economy in Brief: May 2009

Jump to:

Case-Shiller Home Price Index Is Down By Nearly One-Third From 2006 Peak

IFO Shows Sector Indices Have Bottomed...Maybe

IFO Shows Sector Indices HaveBottomed...Maybe

Japan GDP In Record Drop As Trade Collapses

U.S. Leading Indicators Improve Sharply To The Highest Level Since November

Philadelphia Fed Index Indicates A Slowing Rate Of Decline In Economic Activity

U.S. Continuing Claims For Unemployment Insurance Reach Another Record While Initial Claims Dip

U.S. Leading Indicators Improve Sharply To The Highest Level Since November