Tom Moeller

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<title>Chicago Fed National Activity Index Suggests Growth Picked Up in February
by Tom Moeller&nbsp; March 23</title>
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• Crude oil prices slid lower last week and dropped
further yesterday.
• Gasoline prices fall as drivers stay off the road.
• Natural gas prices ease. 
The spot price of West Texas Intermediate crude oil
weakened to $20.10 (-68.5% y/y) per barrel last week from an average $24.40 one
week earlier. It was the lowest price since February 2002. Yesterday, prices
actually turned negative as oil producers paid buyers to take oil over fears
that storage could run out in May. The price of Brent crude oil declined to an
average of $29.18 last week. The price has fallen from a $67.38 high averaged in
the last week of December. Yesterday, the price was $25.93.
Retail gasoline prices declined to $1.81 per gallon
(-36.2% y/y) in the week ended April 20 from $1.85 per gallon in the previous
week. Prices remained below their May 2019 peak of $2.90 per gallon. Haver
Analytics adjusts the gasoline price series for regular seasonal variation. The
seasonally adjusted price fell to $1.73 per gallon from $1.79.
The average price of natural gas edged lower to $1.72/mmbtu
(-34.5% y/y) last week after rising to $1.77 in the prior week. They remained
below the peak of $2.81/mmbtu early in November. Yesterday, the price was
$1.86/mmbtu.
Reduced oil &amp; product prices reflect a collapse in demand
and a rise in supply. In the four weeks ending April 10, gasoline demand
declined 31.6% y/y, while total petroleum product demand fell 18.5% y/y. Crude
oil input to refineries declined 10.7% y/y in the past four weeks. At the same
time,&nbsp; gasoline inventories rose 15.0% y/y and inventories of all
petroleum products increased 4.9% y/y. 
These data are reported by the U.S. Department of Energy. The
price data can be found in Haver's WEEKLY and DAILY databases.
Greater detail on prices, as well as the demand, production and inventory data,
along with regional breakdowns, are in OILWKLY.
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1046">Weekly Energy Prices</th>
 <th width="117">04/20/20</th>
 <th width="117">04/13/20</th>
 <th width="117">04/06/20</th>
 <th width="117">Y/Y %</th>
 <th width="117">2019</th>
 <th width="118">2018</th>
 <th width="118">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr class="odd">
 <td class="firstcol" width="1046">Retail Gasoline ($ per Gallon Regular,
 Monday Price, End of Period)</td>
 <td align="center" width="117">1.81</td>
 <td align="center" width="117">1.85</td>
 <td align="center" width="117">1.92</td>
 <td align="center" width="117">-36.2</td>
 <td align="center" width="117">2.57</td>
 <td align="center" width="118">2.27</td>
 <td align="center" width="118">2.47</td>
 </tr>
 <tr>
 <td class="firstcol" width="1046">Light Sweet Crude Oil, WTI ($ per bbl,
 Previous Week's Average)</td>
 <td align="center" width="117">20.10</td>
 <td align="center" width="117">24.40</td>
 <td align="center" width="117">21.72</td>
 <td align="center" width="117">-68.5</td>
 <td align="center" width="117">56.91</td>
 <td align="center" width="118">64.95</td>
 <td align="center" width="118">50.87</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1046">Natural Gas ($/mmbtu, LA, Previous
 Week's Average)</td>
 <td align="center" width="117">1.72</td>
 <td align="center" width="117">1.77</td>
 <td align="center" width="117">1.62</td>
 <td align="center" width="117">-34.5</td>
 <td align="center" width="117">2.57</td>
 <td align="center" width="118">3.18</td>
 <td align="center" width="118">2.99</td>
 </tr>
 </tbody>
</table>

&nbsp;
Philadelphia Fed Nonmanufacturing Business Activity
Collapses 
by <a href="http://www.haver.com/comment/Moeller.html">Tom
Moeller</a>&nbsp;&nbsp;April 21, 2020
• New orders &amp; shipments fall sharply.
• Employment decline weakens wages.
• Prices paid decline.
The Federal Reserve Bank of Philadelphia reported that its
Nonmanufacturing Business Index of current general activity at the company level
dropped to -12.8 during March after rising to 36.1 in February. The index of
expected general activity similarly declined to -16.3 from 44.2.
Components of the company general activity index were
uniformly weak this month. New orders figures collapsed to -16.4. A reduced 17%
of firms reported improved new orders while a greatly increased 33% reported a
decline. The sales or revenue series fell m/m to -4.9, the lowest level in over
four years. The index of unfilled orders improved but the inventories measure
cratered.
The labor market measures retreated in March. The full-time
permanent employment measure fell to -1.7, indicating job cutbacks at the
greatest rate since 2012. A greatly lessened 19% of firms reported increased
hiring while a surging 20% reported a decline. Part-time/temporary employee
hiring also weakened sharply to a roughly five-year low. The average workweek
reading similarly collapsed as did the wages &amp; benefits measure.
Pricing power was constrained. The index of prices paid fell
to 6.0, down from 34.7 just three months ago. A greatly lessened 15% of firms
reported higher prices while an increased nine percent indicated a decline, the
most in five years. Prices received also were significantly weakened.
The capital expenditure measures fell sharply. The physical
plant measure declined to the lowest level since October. The equipment &amp;
software expenditure reading also weakened to a four-month low.
The Philadelphia Fed figures are diffusion indexes which are
calculated by subtracting the percent of respondents reporting decreases in
business activity from those reporting improvement. So, readings above zero
indicate more positive than negative responses. These indexes have a good
correlation with growth in the series covered. The data are available in Haver's
SURVEYS database.&nbsp;&nbsp;&nbsp; 
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1376">Federal Reserve Bank of
 Philadelphia: Nonmanufacturing Business Outlook Survey (Diffusion Index,
 SA)</th>
 <th scope="col" width="70">Apr</th>
 <th scope="col" width="70">Mar</th>
 <th scope="col" width="70">Feb</th>
 <th scope="col" width="70">Apr'19</th>
 <th scope="col" width="70">2019</th>
 <th scope="col" width="70">2018</th>
 <th scope="col" width="71">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="1376">General Activity - Company</td>
 <td align="center" width="70">-82.5</td>
 <td align="center" width="70">-12.8</td>
 <td align="center" width="70">36.1</td>
 <td align="center" width="70">34.5</td>
 <td align="center" width="70">23.4</td>
 <td align="center" width="70">33.5</td>
 <td align="center" width="71">27.2</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; New Orders</td>
 <td align="center" width="70">-67.2</td>
 <td align="center" width="70">-16.4</td>
 <td align="center" width="70">28.1</td>
 <td align="center" width="70">21.0</td>
 <td align="center" width="70">16.7</td>
 <td align="center" width="70">24.2</td>
 <td align="center" width="71">19.1</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Sales or Revenue</td>
 <td align="center" width="70">-87.9</td>
 <td align="center" width="70">-4.9</td>
 <td align="center" width="70">39.8</td>
 <td align="center" width="70">34.0</td>
 <td align="center" width="70">24.0</td>
 <td align="center" width="70">30.8</td>
 <td align="center" width="71">27.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Inventories</td>
 <td align="center" width="70">1.9</td>
 <td align="center" width="70">-1.7</td>
 <td align="center" width="70">5.6</td>
 <td align="center" width="70">2.0</td>
 <td align="center" width="70">4.0</td>
 <td align="center" width="70">5.2</td>
 <td align="center" width="71">3.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Number of Full-Time Permanent
 Employees</td>
 <td align="center" width="70">-47.5</td>
 <td align="center" width="70">-1.7</td>
 <td align="center" width="70">21.5</td>
 <td align="center" width="70">18.7</td>
 <td align="center" width="70">20.9</td>
 <td align="center" width="70">18.1</td>
 <td align="center" width="71">14.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Part-Time/Temporary/Contract
 Employees</td>
 <td align="center" width="70">-58.9</td>
 <td align="center" width="70">-11.2</td>
 <td align="center" width="70">10.4</td>
 <td align="center" width="70">23.1</td>
 <td align="center" width="70">14.6</td>
 <td align="center" width="70">15.5</td>
 <td align="center" width="71">12.3</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Prices Paid</td>
 <td align="center" width="70">-0.4</td>
 <td align="center" width="70">6.0</td>
 <td align="center" width="70">21.3</td>
 <td align="center" width="70">26.4</td>
 <td align="center" width="70">25.0</td>
 <td align="center" width="70">28.3</td>
 <td align="center" width="71">21.4</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Wage &amp; Benefit Costs</td>
 <td align="center" width="70">-35.7</td>
 <td align="center" width="70">26.6</td>
 <td align="center" width="70">30.7</td>
 <td align="center" width="70">37.0</td>
 <td align="center" width="70">39.4</td>
 <td align="center" width="70">40.1</td>
 <td align="center" width="71">33.5</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">Expected General Activity - Company</td>
 <td align="center" width="70"></td>
 <td align="center" width="70">-16.3</td>
 <td align="center" width="70">44.2</td>
 <td align="center" width="70">44.2</td>
 <td align="center" width="70">41.7</td>
 <td align="center" width="70">49.9</td>
 <td align="center" width="71">49.8</td>
 </tr>
 </tbody>
</table>

&nbsp;
U.S. Existing Home Sales Reach 2007 High with Increased
Prices in February 
by <a href="http://www.haver.com/comment/Moeller.html">Tom
Moeller</a>&nbsp;&nbsp; &nbsp;&nbsp; April 21, 2020
• Existing home sales weaken to xxx low.
• Sales declines are broad-based around the country.
• Prices weaken as inventory increases.
The National Association of Realtors (NAR) reported that
sales of existing homes during February jumped 6.5% (7.2% y/y) to 5.770 million
(AR) from 5.420 million in January, revised from 5.460 million. It was the
highest level of sales since February 2007. The Action Economics Forecast Survey
expected February sales of 5.52 million.
The median price of all existing homes sold increased 1.5%
(8.0% y/y) to $270,100 following a 3.0% January decline. The average sales price
improved 1.0% last month (6.0% y/y) to $305,800. These price data are not
seasonally adjusted.
Existing home sales were mixed around the country in
February. The increase in sales overall was paced by an 18.9% surge (11.5% y/y)
in the West to 1.260 million, the highest level since February 2007. Sales in
the South rose 7.2% (8.2% y/y) to 2.520 million, the highest level since October
2006, while sales in the Midwest edged 0.8% up (4.0% y/y). Sales in the
Northeast declined, however, by 4.1% (+2.9% y/y) to 700,000, the lowest level in
three months.
Sales of existing single-family homes strengthened 7.3% both
m/m and&nbsp; y/y to 5.170 million units after falling 1.8% in January. Sales of
condos and co-ops held steady (7.1% y/y) at 600,000 units.
The number of homes on the market decreased 9.8% y/y and
roughly equaled the record low. The month's supply of homes on the market
remained at 3.1 versus 3.6 one year earlier and roughly equaled the record low.
These inventory figures date back to 1999.
The data on existing home sales, prices and affordability are
compiled by the National Association of Realtors and can be found in Haver's USECON
database. The regional price, affordability and inventory data are available in
the REALTOR database. The expectations figure is from the Action
Economics Forecast Survey, reported in the AS1REPNA database.
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="706">Existing Home Sales (SAAR,
 000s)</th>
 <th scope="col" width="165">Mar</th>
 <th scope="col" width="166">Feb</th>
 <th scope="col" width="166">Jan</th>
 <th scope="col" width="166">Mar Y/Y %</th>
 <th scope="col" width="166">2019</th>
 <th scope="col" width="166">2018</th>
 <th scope="col" width="166">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="706">Total Sales</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">5,770</td>
 <td align="center" width="166">5,420</td>
 <td align="center" width="166">7.2</td>
 <td align="center" width="166">5,330</td>
 <td align="center" width="166">5,341</td>
 <td align="center" width="166">5,531</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">&nbsp;&nbsp; Northeast</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">700</td>
 <td align="center" width="166">730</td>
 <td align="center" width="166">2.9</td>
 <td align="center" width="166">687</td>
 <td align="center" width="166">689</td>
 <td align="center" width="166">735</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">&nbsp;&nbsp; Midwest</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">1,290</td>
 <td align="center" width="166">1,280</td>
 <td align="center" width="166">4.0</td>
 <td align="center" width="166">1,248</td>
 <td align="center" width="166">1,265</td>
 <td align="center" width="166">1,301</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">&nbsp;&nbsp; South</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">2,520</td>
 <td align="center" width="166">2,350</td>
 <td align="center" width="166">8.2</td>
 <td align="center" width="166">2,281</td>
 <td align="center" width="166">2,246</td>
 <td align="center" width="166">2,270</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">&nbsp;&nbsp; West</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">1,260</td>
 <td align="center" width="166">1,060</td>
 <td align="center" width="166">11.5</td>
 <td align="center" width="166">1,115</td>
 <td align="center" width="166">1,141</td>
 <td align="center" width="166">1,225</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">Single-Family Sales</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">5,170</td>
 <td align="center" width="166">4,820</td>
 <td align="center" width="166">7.3</td>
 <td align="center" width="166">4,754</td>
 <td align="center" width="166">4,742</td>
 <td align="center" width="166">4,907</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">Median Price Total ($, NSA)</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">270,100</td>
 <td align="center" width="166">266,200</td>
 <td align="center" width="166">8.0</td>
 <td align="center" width="166">269,783</td>
 <td align="center" width="166">257,267</td>
 <td align="center" width="166">245,950</td>
 </tr>
 </tbody>
</table>


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• Crude oil prices slid lower last week and dropped further yesterday. • Gasoline prices fall as drivers stay off the road. • Natural gas prices ease. The spot price of West Texas Intermediate crude oil weakened to $20.10 (-68.5% y/y) [...]

U.S. Petroleum Prices Plunge as Demand Dries Up

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<title>Chicago Fed National Activity Index Suggests Growth Picked Up in February
by Tom Moeller&nbsp; March 23</title>
</head>

<body>

 

• Crude oil prices slid lower last week and dropped
further yesterday.
• Gasoline prices fall as drivers stay off the road.
• Natural gas prices ease. 
The spot price of West Texas Intermediate crude oil
weakened to $20.10 (-68.5% y/y) per barrel last week from an average $24.40 one
week earlier. It was the lowest price since February 2002.&nbsp; Yesterday, prices actually turned negative as
oil producers paid buyers to take oil over fears of continued weak demand and a
lack of storage. The price of Brent crude oil declined to an average of $29.18
last week. The price has fallen from a $67.38 high averaged in the last week of
December. Yesterday, the price was $25.93.
Retail gasoline prices declined to $1.81 per gallon
(-36.2% y/y) in the week ended April 20 from $1.85 per gallon in the previous
week. Prices remained below their May 2019 peak of $2.90 per gallon. Haver
Analytics adjusts the gasoline price series for regular seasonal variation. The
seasonally adjusted price fell to $1.73 per gallon from $1.79.
The average price of natural gas edged lower to $1.72/mmbtu
(-34.5% y/y) last week after rising to $1.77 in the prior week. They remained
below the peak of $2.81/mmbtu early in November. Yesterday, the price was
$1.86/mmbtu.
Reduced oil &amp; product prices reflect a collapse in demand
and a rise in supply. In the four weeks ending April 10, gasoline demand
declined 31.6% y/y, while total petroleum product demand fell 18.5% y/y. Crude
oil input to refineries declined 10.7% y/y in the past four weeks. At the same
time,&nbsp; gasoline inventories rose 15.0% y/y and inventories of all
petroleum products increased 4.9% y/y. 
These data are reported by the U.S. Department of Energy. The
price data can be found in Haver's WEEKLY and DAILY databases.
Greater detail on prices, as well as the demand, production and inventory data,
along with regional breakdowns, are in OILWKLY.
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1046">Weekly Energy Prices</th>
 <th width="117">04/20/20</th>
 <th width="117">04/13/20</th>
 <th width="117">04/06/20</th>
 <th width="117">Y/Y %</th>
 <th width="117">2019</th>
 <th width="118">2018</th>
 <th width="118">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr class="odd">
 <td class="firstcol" width="1046">Retail Gasoline ($ per Gallon Regular,
 Monday Price, End of Period)</td>
 <td align="center" width="117">1.81</td>
 <td align="center" width="117">1.85</td>
 <td align="center" width="117">1.92</td>
 <td align="center" width="117">-36.2</td>
 <td align="center" width="117">2.57</td>
 <td align="center" width="118">2.27</td>
 <td align="center" width="118">2.47</td>
 </tr>
 <tr>
 <td class="firstcol" width="1046">Light Sweet Crude Oil, WTI ($ per bbl,
 Previous Week's Average)</td>
 <td align="center" width="117">20.10</td>
 <td align="center" width="117">24.40</td>
 <td align="center" width="117">21.72</td>
 <td align="center" width="117">-68.5</td>
 <td align="center" width="117">56.91</td>
 <td align="center" width="118">64.95</td>
 <td align="center" width="118">50.87</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1046">Natural Gas ($/mmbtu, LA, Previous
 Week's Average)</td>
 <td align="center" width="117">1.72</td>
 <td align="center" width="117">1.77</td>
 <td align="center" width="117">1.62</td>
 <td align="center" width="117">-34.5</td>
 <td align="center" width="117">2.57</td>
 <td align="center" width="118">3.18</td>
 <td align="center" width="118">2.99</td>
 </tr>
 </tbody>
</table>

&nbsp;
Philadelphia Fed Nonmanufacturing Business Activity
Collapses 
by <a href="http://www.haver.com/comment/Moeller.html">Tom
Moeller</a>&nbsp;&nbsp;April 21, 2020
• New orders &amp; shipments turn negative.
• Employment decline weakens wages.
• Prices paid fall sharply.
The Federal Reserve Bank of Philadelphia reported that its
Nonmanufacturing Business Index of current activity at the company level dropped
to -82.5 during April after weakening to -12.8 in March. The index of expected
general activity similarly remained negative at -24.5.
Components of the company general activity index were all
weak this month. New orders figures collapsed to -67.2 as only 0.3% of firms
reported improved new orders while a greatly increased 68% reported a decline.
The sales or revenue series fell m/m to -87.9. The index of unfilled orders also
went negative but the inventories measure rose slightly.
The labor market measures unraveled in April. The full-time
permanent employment measure fell to -47.5, indicating a record pace of job
cutbacks. A greatly lessened 4% of firms reported increased hiring while a
surging 52% reported a decline. Part-time/temporary employee hiring again was
pulled back. The average workweek reading similarly dove. The wages &amp;
benefits measure turned negative.
Pricing power evaporated. The index of prices paid fell to
-0.4, down from 34.7 late last year. A greatly lessened 13% of firms reported
higher prices while a near-record 14% paid less. The prices received index fell
well into negative territory.&nbsp;&nbsp;&nbsp; 
The capital expenditure measures collapsed. Both the physical
plant and equipment &amp; software expenditure readings turned negative. Seven
percent of respondents raised outlays on equipment while 48% lowered them. 
The Philadelphia Fed figures are diffusion indexes which are
calculated by subtracting the percent of respondents reporting decreases in
business activity from those reporting improvement. So, readings above zero
indicate more positive than negative responses. These indexes have a good
correlation with growth in the series covered. The data are available in Haver's
SURVEYS database.&nbsp;&nbsp;&nbsp; 
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1376">Federal Reserve Bank of
 Philadelphia: Nonmanufacturing Business Outlook Survey (Diffusion Index,
 SA)</th>
 <th scope="col" width="70">Apr</th>
 <th scope="col" width="70">Mar</th>
 <th scope="col" width="70">Feb</th>
 <th scope="col" width="70">Apr'19</th>
 <th scope="col" width="70">2019</th>
 <th scope="col" width="70">2018</th>
 <th scope="col" width="71">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="1376">General Activity - Company</td>
 <td align="center" width="70">-82.5</td>
 <td align="center" width="70">-12.8</td>
 <td align="center" width="70">36.1</td>
 <td align="center" width="70">34.5</td>
 <td align="center" width="70">23.4</td>
 <td align="center" width="70">33.5</td>
 <td align="center" width="71">27.2</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; New Orders</td>
 <td align="center" width="70">-67.2</td>
 <td align="center" width="70">-16.4</td>
 <td align="center" width="70">28.1</td>
 <td align="center" width="70">21.0</td>
 <td align="center" width="70">16.7</td>
 <td align="center" width="70">24.2</td>
 <td align="center" width="71">19.1</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Sales or Revenue</td>
 <td align="center" width="70">-87.9</td>
 <td align="center" width="70">-4.9</td>
 <td align="center" width="70">39.8</td>
 <td align="center" width="70">34.0</td>
 <td align="center" width="70">24.0</td>
 <td align="center" width="70">30.8</td>
 <td align="center" width="71">27.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Inventories</td>
 <td align="center" width="70">1.9</td>
 <td align="center" width="70">-1.7</td>
 <td align="center" width="70">5.6</td>
 <td align="center" width="70">2.0</td>
 <td align="center" width="70">4.0</td>
 <td align="center" width="70">5.2</td>
 <td align="center" width="71">3.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Number of Full-Time Permanent
 Employees</td>
 <td align="center" width="70">-47.5</td>
 <td align="center" width="70">-1.7</td>
 <td align="center" width="70">21.5</td>
 <td align="center" width="70">18.7</td>
 <td align="center" width="70">20.9</td>
 <td align="center" width="70">18.1</td>
 <td align="center" width="71">14.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Part-Time/Temporary/Contract
 Employees</td>
 <td align="center" width="70">-58.9</td>
 <td align="center" width="70">-11.2</td>
 <td align="center" width="70">10.4</td>
 <td align="center" width="70">23.1</td>
 <td align="center" width="70">14.6</td>
 <td align="center" width="70">15.5</td>
 <td align="center" width="71">12.3</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Prices Paid</td>
 <td align="center" width="70">-0.4</td>
 <td align="center" width="70">6.0</td>
 <td align="center" width="70">21.3</td>
 <td align="center" width="70">26.4</td>
 <td align="center" width="70">25.0</td>
 <td align="center" width="70">28.3</td>
 <td align="center" width="71">21.4</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Wage &amp; Benefit Costs</td>
 <td align="center" width="70">-35.7</td>
 <td align="center" width="70">26.6</td>
 <td align="center" width="70">30.7</td>
 <td align="center" width="70">37.0</td>
 <td align="center" width="70">39.4</td>
 <td align="center" width="70">40.1</td>
 <td align="center" width="71">33.5</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">Expected General Activity - Company</td>
 <td align="center" width="70">-24.5</td>
 <td align="center" width="70">-16.3</td>
 <td align="center" width="70">44.2</td>
 <td align="center" width="70">43.4</td>
 <td align="center" width="70">41.7</td>
 <td align="center" width="70">49.9</td>
 <td align="center" width="71">49.8</td>
 </tr>
 </tbody>
</table>

&nbsp;
U.S. Existing Home Sales Reach 2007 High with Increased
Prices in February 
by <a href="http://www.haver.com/comment/Moeller.html">Tom
Moeller</a>&nbsp;&nbsp; &nbsp;&nbsp; April 21, 2020
• Existing home sales weaken to xxx low.
• Sales declines are broad-based around the country.
• Prices weaken as inventory increases.
The National Association of Realtors (NAR) reported that
sales of existing homes during February jumped 6.5% (7.2% y/y) to 5.770 million
(AR) from 5.420 million in January, revised from 5.460 million. It was the
highest level of sales since February 2007. The Action Economics Forecast Survey
expected February sales of 5.52 million.
The median price of all existing homes sold increased 1.5%
(8.0% y/y) to $270,100 following a 3.0% January decline. The average sales price
improved 1.0% last month (6.0% y/y) to $305,800. These price data are not
seasonally adjusted.
Existing home sales were mixed around the country in
February. The increase in sales overall was paced by an 18.9% surge (11.5% y/y)
in the West to 1.260 million, the highest level since February 2007. Sales in
the South rose 7.2% (8.2% y/y) to 2.520 million, the highest level since October
2006, while sales in the Midwest edged 0.8% up (4.0% y/y). Sales in the
Northeast declined, however, by 4.1% (+2.9% y/y) to 700,000, the lowest level in
three months.
Sales of existing single-family homes strengthened 7.3% both
m/m and&nbsp; y/y to 5.170 million units after falling 1.8% in January. Sales of
condos and co-ops held steady (7.1% y/y) at 600,000 units.
The number of homes on the market decreased 9.8% y/y and
roughly equaled the record low. The month's supply of homes on the market
remained at 3.1 versus 3.6 one year earlier and roughly equaled the record low.
These inventory figures date back to 1999.
The data on existing home sales, prices and affordability are
compiled by the National Association of Realtors and can be found in Haver's USECON
database. The regional price, affordability and inventory data are available in
the REALTOR database. The expectations figure is from the Action
Economics Forecast Survey, reported in the AS1REPNA database.
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="706">Existing Home Sales (SAAR,
 000s)</th>
 <th scope="col" width="165">Mar</th>
 <th scope="col" width="166">Feb</th>
 <th scope="col" width="166">Jan</th>
 <th scope="col" width="166">Mar Y/Y %</th>
 <th scope="col" width="166">2019</th>
 <th scope="col" width="166">2018</th>
 <th scope="col" width="166">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="706">Total Sales</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">5,770</td>
 <td align="center" width="166">5,420</td>
 <td align="center" width="166">7.2</td>
 <td align="center" width="166">5,330</td>
 <td align="center" width="166">5,341</td>
 <td align="center" width="166">5,531</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">&nbsp;&nbsp; Northeast</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">700</td>
 <td align="center" width="166">730</td>
 <td align="center" width="166">2.9</td>
 <td align="center" width="166">687</td>
 <td align="center" width="166">689</td>
 <td align="center" width="166">735</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">&nbsp;&nbsp; Midwest</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">1,290</td>
 <td align="center" width="166">1,280</td>
 <td align="center" width="166">4.0</td>
 <td align="center" width="166">1,248</td>
 <td align="center" width="166">1,265</td>
 <td align="center" width="166">1,301</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">&nbsp;&nbsp; South</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">2,520</td>
 <td align="center" width="166">2,350</td>
 <td align="center" width="166">8.2</td>
 <td align="center" width="166">2,281</td>
 <td align="center" width="166">2,246</td>
 <td align="center" width="166">2,270</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">&nbsp;&nbsp; West</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">1,260</td>
 <td align="center" width="166">1,060</td>
 <td align="center" width="166">11.5</td>
 <td align="center" width="166">1,115</td>
 <td align="center" width="166">1,141</td>
 <td align="center" width="166">1,225</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">Single-Family Sales</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">5,170</td>
 <td align="center" width="166">4,820</td>
 <td align="center" width="166">7.3</td>
 <td align="center" width="166">4,754</td>
 <td align="center" width="166">4,742</td>
 <td align="center" width="166">4,907</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">Median Price Total ($, NSA)</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">270,100</td>
 <td align="center" width="166">266,200</td>
 <td align="center" width="166">8.0</td>
 <td align="center" width="166">269,783</td>
 <td align="center" width="166">257,267</td>
 <td align="center" width="166">245,950</td>
 </tr>
 </tbody>
</table>


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<title>Chicago Fed National Activity Index Suggests Growth Picked Up in February
by Tom Moeller&nbsp; March 23</title>
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<body>

 

• Crude oil prices slid lower last week and dropped
further yesterday.
• Gasoline prices fall as drivers stay off the road.
• Natural gas prices ease.&nbsp;
The spot price of West Texas Intermediate crude oil
weakened to $20.10 (-68.5% y/y) per barrel last week from an average $24.40 one
week earlier. It was the lowest price since February 2002.&nbsp; Yesterday, prices actually turned negative as
oil producers paid buyers to take oil over fears of continued weak demand and a
lack of storage. The price of Brent crude oil declined to an average of $29.18
last week. The price has fallen from a $67.38 high averaged in the last week of
December. Yesterday, the price was $25.93.
Retail gasoline prices declined to $1.81 per gallon
(-36.2% y/y) in the week ended April 20 from $1.85 per gallon in the previous
week. Prices remained below their May 2019 peak of $2.90 per gallon. Haver
Analytics adjusts the gasoline price series for regular seasonal variation. The
seasonally adjusted price fell to $1.73 per gallon from $1.79.
The average price of natural gas edged lower to $1.72/mmbtu
(-34.5% y/y) last week after rising to $1.77 in the prior week. They remained
below the peak of $2.81/mmbtu early in November. Yesterday, the price was
$1.86/mmbtu.
Reduced oil &amp; product prices reflect a collapse in demand
and a rise in supply. In the four weeks ending April 10, gasoline demand
declined 31.6% y/y, while total petroleum product demand fell 18.5% y/y. Crude
oil input to refineries declined 10.7% y/y in the past four weeks. At the same
time,&nbsp; gasoline inventories rose 15.0% y/y and inventories of all
petroleum products increased 4.9% y/y.&nbsp;
These data are reported by the U.S. Department of Energy. The
price data can be found in Haver's WEEKLY and DAILY databases.
Greater detail on prices, as well as the demand, production and inventory data,
along with regional breakdowns, are in OILWKLY.
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1046">Weekly Energy Prices</th>
 <th width="117">04/20/20</th>
 <th width="117">04/13/20</th>
 <th width="117">04/06/20</th>
 <th width="117">Y/Y %</th>
 <th width="117">2019</th>
 <th width="118">2018</th>
 <th width="118">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr class="odd">
 <td class="firstcol" width="1046">Retail Gasoline ($ per Gallon Regular,
 Monday Price, End of Period)</td>
 <td align="center" width="117">1.81</td>
 <td align="center" width="117">1.85</td>
 <td align="center" width="117">1.92</td>
 <td align="center" width="117">-36.2</td>
 <td align="center" width="117">2.57</td>
 <td align="center" width="118">2.27</td>
 <td align="center" width="118">2.47</td>
 </tr>
 <tr>
 <td class="firstcol" width="1046">Light Sweet Crude Oil, WTI ($ per bbl,
 Previous Week's Average)</td>
 <td align="center" width="117">20.10</td>
 <td align="center" width="117">24.40</td>
 <td align="center" width="117">21.72</td>
 <td align="center" width="117">-68.5</td>
 <td align="center" width="117">56.91</td>
 <td align="center" width="118">64.95</td>
 <td align="center" width="118">50.87</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1046">Natural Gas ($/mmbtu, LA, Previous
 Week's Average)</td>
 <td align="center" width="117">1.72</td>
 <td align="center" width="117">1.77</td>
 <td align="center" width="117">1.62</td>
 <td align="center" width="117">-34.5</td>
 <td align="center" width="117">2.57</td>
 <td align="center" width="118">3.18</td>
 <td align="center" width="118">2.99</td>
 </tr>
 </tbody>
</table>

&nbsp;
Philadelphia Fed Nonmanufacturing Business Activity
Collapses 
by <a href="http://www.haver.com/comment/Moeller.html">Tom
Moeller</a>&nbsp;&nbsp;April 21, 2020
• New orders &amp; shipments turn negative.
• Employment decline weakens wages.
• Prices paid fall sharply.
The Federal Reserve Bank of Philadelphia reported that its
Nonmanufacturing Business Index of current activity at the company level dropped
to -82.5 during April after weakening to -12.8 in March. The index of expected
general activity similarly remained negative at -24.5.
Components of the company general activity index were all
weak this month. New orders figures collapsed to -67.2 as only 0.3% of firms
reported improved new orders while a greatly increased 68% reported a decline.
The sales or revenue series fell m/m to -87.9. The index of unfilled orders also
went negative but the inventories measure rose slightly.
The labor market measures unraveled in April. The full-time
permanent employment measure fell to -47.5, indicating a record pace of job
cutbacks. A greatly lessened 4% of firms reported increased hiring while a
surging 52% reported a decline. Part-time/temporary employee hiring again was
pulled back. The average workweek reading similarly dove. The wages &amp;
benefits measure turned negative.
Pricing power evaporated. The index of prices paid fell to
-0.4, down from 34.7 late last year. A greatly lessened 13% of firms reported
higher prices while a near-record 14% paid less. The prices received index fell
well into negative territory.&nbsp;&nbsp;&nbsp;&nbsp;
The capital expenditure measures collapsed. Both the physical
plant and equipment &amp; software expenditure readings turned negative. Seven
percent of respondents raised outlays on equipment while 48% lowered them.&nbsp;
The Philadelphia Fed figures are diffusion indexes which are
calculated by subtracting the percent of respondents reporting decreases in
business activity from those reporting improvement. So, readings above zero
indicate more positive than negative responses. These indexes have a good
correlation with growth in the series covered. The data are available in Haver's
SURVEYS database.&nbsp;&nbsp;&nbsp;&nbsp;
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1376">Federal Reserve Bank of
 Philadelphia: Nonmanufacturing Business Outlook Survey (Diffusion Index,
 SA)</th>
 <th scope="col" width="70">Apr</th>
 <th scope="col" width="70">Mar</th>
 <th scope="col" width="70">Feb</th>
 <th scope="col" width="70">Apr'19</th>
 <th scope="col" width="70">2019</th>
 <th scope="col" width="70">2018</th>
 <th scope="col" width="71">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="1376">General Activity - Company</td>
 <td align="center" width="70">-82.5</td>
 <td align="center" width="70">-12.8</td>
 <td align="center" width="70">36.1</td>
 <td align="center" width="70">34.5</td>
 <td align="center" width="70">23.4</td>
 <td align="center" width="70">33.5</td>
 <td align="center" width="71">27.2</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; New Orders</td>
 <td align="center" width="70">-67.2</td>
 <td align="center" width="70">-16.4</td>
 <td align="center" width="70">28.1</td>
 <td align="center" width="70">21.0</td>
 <td align="center" width="70">16.7</td>
 <td align="center" width="70">24.2</td>
 <td align="center" width="71">19.1</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Sales or Revenue</td>
 <td align="center" width="70">-87.9</td>
 <td align="center" width="70">-4.9</td>
 <td align="center" width="70">39.8</td>
 <td align="center" width="70">34.0</td>
 <td align="center" width="70">24.0</td>
 <td align="center" width="70">30.8</td>
 <td align="center" width="71">27.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Inventories</td>
 <td align="center" width="70">1.9</td>
 <td align="center" width="70">-1.7</td>
 <td align="center" width="70">5.6</td>
 <td align="center" width="70">2.0</td>
 <td align="center" width="70">4.0</td>
 <td align="center" width="70">5.2</td>
 <td align="center" width="71">3.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Number of Full-Time Permanent
 Employees</td>
 <td align="center" width="70">-47.5</td>
 <td align="center" width="70">-1.7</td>
 <td align="center" width="70">21.5</td>
 <td align="center" width="70">18.7</td>
 <td align="center" width="70">20.9</td>
 <td align="center" width="70">18.1</td>
 <td align="center" width="71">14.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Part-Time/Temporary/Contract
 Employees</td>
 <td align="center" width="70">-58.9</td>
 <td align="center" width="70">-11.2</td>
 <td align="center" width="70">10.4</td>
 <td align="center" width="70">23.1</td>
 <td align="center" width="70">14.6</td>
 <td align="center" width="70">15.5</td>
 <td align="center" width="71">12.3</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Prices Paid</td>
 <td align="center" width="70">-0.4</td>
 <td align="center" width="70">6.0</td>
 <td align="center" width="70">21.3</td>
 <td align="center" width="70">26.4</td>
 <td align="center" width="70">25.0</td>
 <td align="center" width="70">28.3</td>
 <td align="center" width="71">21.4</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Wage &amp; Benefit Costs</td>
 <td align="center" width="70">-35.7</td>
 <td align="center" width="70">26.6</td>
 <td align="center" width="70">30.7</td>
 <td align="center" width="70">37.0</td>
 <td align="center" width="70">39.4</td>
 <td align="center" width="70">40.1</td>
 <td align="center" width="71">33.5</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">Expected General Activity - Company</td>
 <td align="center" width="70">-24.5</td>
 <td align="center" width="70">-16.3</td>
 <td align="center" width="70">44.2</td>
 <td align="center" width="70">43.4</td>
 <td align="center" width="70">41.7</td>
 <td align="center" width="70">49.9</td>
 <td align="center" width="71">49.8</td>
 </tr>
 </tbody>
</table>

&nbsp;
U.S. Existing Home Sales Pull Back but Prices Rise 
by <a href="http://www.haver.com/comment/Moeller.html">Tom
Moeller</a>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; April 21, 2020
• Existing home sales near 2019 low as coronavirus sets
in.
• Sales decline around the country.
• Prices improved before quarantine.
The National Association of Realtors (NAR) reported that
sales of existing homes during March declined 8.5% (+0.8% y/y) to 5.270 million
(AR) from 5.760 million in February, revised from 5.770 million. It was the
lowest level of sales since April of last year. The Action Economics Forecast
Survey expected March sales of 5.30 million.
The median price of all existing homes sold increased 3.8% (NSA,
8.0% y/y) to $280,600 following a 1.6% February increase. The average sales
price improved 3.3% last month (6.2% y/y) to $316,000. These price data are not
seasonally adjusted.
Existing home sales weakened around the country in March. In
the West, sales fell 13.6% (-0.9% y/y) to 1.080 million and reversed the
increase in February. Sales in the South declined 9.1% (+0.9% y/y) to 2.290
million, the lowest level since November. In the Northeast, sales fell 7.1%
(-3.0% y/y) to 650,000, roughly five-year low. Sales in the Midwest were off
3.1% (+4.2% y/y) to 1.250 million, the lowest level since May of last year.
Sales of existing single-family homes weakened 8.1% (+1.3%
y/y) to 4.740 million units and reversed February's rise. Sales of condos and
co-ops weakened plunged 11.7% (-3.6% y/y) to 530,000 units, the lowest level
since July 2012.
The number of homes on the market decreased 10.2% y/y, but
rose seasonally in recent months. The months' supply of homes on the market
improved m/m to 3.4 but compared to 3.8 one year earlier. These inventory
figures date back to 1999.
The data on existing home sales, prices and affordability are
compiled by the National Association of Realtors and can be found in Haver's USECON
database. The regional price, affordability and inventory data are available in
the REALTOR database. The expectations figure is from the Action
Economics Forecast Survey, reported in the AS1REPNA database.
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="706">Existing Home Sales (SAAR,
 000s)</th>
 <th scope="col" width="165">Mar</th>
 <th scope="col" width="166">Feb</th>
 <th scope="col" width="166">Jan</th>
 <th scope="col" width="166">Mar Y/Y %</th>
 <th scope="col" width="166">2019</th>
 <th scope="col" width="166">2018</th>
 <th scope="col" width="166">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="706">Total Sales</td>
 <td align="center" width="165">5,270</td>
 <td align="center" width="166">5,760</td>
 <td align="center" width="166">5,420</td>
 <td align="center" width="166">0.8</td>
 <td align="center" width="166">5,330</td>
 <td align="center" width="166">5,341</td>
 <td align="center" width="166">5,531</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">&nbsp;&nbsp; Northeast</td>
 <td align="center" width="165">650</td>
 <td align="center" width="166">700</td>
 <td align="center" width="166">730</td>
 <td align="center" width="166">-3.0</td>
 <td align="center" width="166">687</td>
 <td align="center" width="166">689</td>
 <td align="center" width="166">735</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">&nbsp;&nbsp; Midwest</td>
 <td align="center" width="165">1,250</td>
 <td align="center" width="166">1,290</td>
 <td align="center" width="166">1,280</td>
 <td align="center" width="166">4.2</td>
 <td align="center" width="166">1,248</td>
 <td align="center" width="166">1,265</td>
 <td align="center" width="166">1,301</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">&nbsp;&nbsp; South</td>
 <td align="center" width="165">2,290</td>
 <td align="center" width="166">2,520</td>
 <td align="center" width="166">2,350</td>
 <td align="center" width="166">0.9</td>
 <td align="center" width="166">2,281</td>
 <td align="center" width="166">2,246</td>
 <td align="center" width="166">2,270</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">&nbsp;&nbsp; West</td>
 <td align="center" width="165">1,080</td>
 <td align="center" width="166">1,250</td>
 <td align="center" width="166">1,060</td>
 <td align="center" width="166">-0.9</td>
 <td align="center" width="166">1,115</td>
 <td align="center" width="166">1,141</td>
 <td align="center" width="166">1,225</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">Single-Family Sales</td>
 <td align="center" width="165">4,740</td>
 <td align="center" width="166">5,160</td>
 <td align="center" width="166">4,820</td>
 <td align="center" width="166">1.3</td>
 <td align="center" width="166">4,754</td>
 <td align="center" width="166">4,742</td>
 <td align="center" width="166">4,907</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">Median Price Total ($, NSA)</td>
 <td align="center" width="165">280,600</td>
 <td align="center" width="166">270,400</td>
 <td align="center" width="166">266,200</td>
 <td align="center" width="166">8.0</td>
 <td align="center" width="166">269,783</td>
 <td align="center" width="166">257,267</td>
 <td align="center" width="166">245,950</td>
 </tr>
 </tbody>
</table>


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<title>Chicago Fed National Activity Index Suggests Growth Picked Up in February
by Tom Moeller&nbsp; March 23</title>
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<body>

 

• Crude oil prices slid lower last week and dropped
further yesterday.
• Gasoline prices fall as drivers stay off the road.
• Natural gas prices ease. 
The spot price of West Texas Intermediate crude oil
weakened to $20.10 (-68.5% y/y) per barrel last week from an average $24.40 one
week earlier. It was the lowest price since February 2002.&nbsp; Yesterday, prices actually turned negative as
oil producers paid buyers to take oil over fears of continued weak demand and a
lack of storage. The price of Brent crude oil declined to an average of $29.18
last week. The price has fallen from a $67.38 high averaged in the last week of
December. Yesterday, the price was $25.93.
Retail gasoline prices declined to $1.81 per gallon
(-36.2% y/y) in the week ended April 20 from $1.85 per gallon in the previous
week. Prices remained below their May 2019 peak of $2.90 per gallon. Haver
Analytics adjusts the gasoline price series for regular seasonal variation. The
seasonally adjusted price fell to $1.73 per gallon from $1.79.
The average price of natural gas edged lower to $1.72/mmbtu
(-34.5% y/y) last week after rising to $1.77 in the prior week. They remained
below the peak of $2.81/mmbtu early in November. Yesterday, the price was
$1.86/mmbtu.
Reduced oil &amp; product prices reflect a collapse in demand
and a rise in supply. In the four weeks ending April 10, gasoline demand
declined 31.6% y/y, while total petroleum product demand fell 18.5% y/y. Crude
oil input to refineries declined 10.7% y/y in the past four weeks. At the same
time,&nbsp; gasoline inventories rose 15.0% y/y and inventories of all
petroleum products increased 4.9% y/y. 
These data are reported by the U.S. Department of Energy. The
price data can be found in Haver's WEEKLY and DAILY databases.
Greater detail on prices, as well as the demand, production and inventory data,
along with regional breakdowns, are in OILWKLY.
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1046">Weekly Energy Prices</th>
 <th width="117">04/20/20</th>
 <th width="117">04/13/20</th>
 <th width="117">04/06/20</th>
 <th width="117">Y/Y %</th>
 <th width="117">2019</th>
 <th width="118">2018</th>
 <th width="118">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr class="odd">
 <td class="firstcol" width="1046">Retail Gasoline ($ per Gallon Regular,
 Monday Price, End of Period)</td>
 <td align="center" width="117">1.81</td>
 <td align="center" width="117">1.85</td>
 <td align="center" width="117">1.92</td>
 <td align="center" width="117">-36.2</td>
 <td align="center" width="117">2.57</td>
 <td align="center" width="118">2.27</td>
 <td align="center" width="118">2.47</td>
 </tr>
 <tr>
 <td class="firstcol" width="1046">Light Sweet Crude Oil, WTI ($ per bbl,
 Previous Week's Average)</td>
 <td align="center" width="117">20.10</td>
 <td align="center" width="117">24.40</td>
 <td align="center" width="117">21.72</td>
 <td align="center" width="117">-68.5</td>
 <td align="center" width="117">56.91</td>
 <td align="center" width="118">64.95</td>
 <td align="center" width="118">50.87</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1046">Natural Gas ($/mmbtu, LA, Previous
 Week's Average)</td>
 <td align="center" width="117">1.72</td>
 <td align="center" width="117">1.77</td>
 <td align="center" width="117">1.62</td>
 <td align="center" width="117">-34.5</td>
 <td align="center" width="117">2.57</td>
 <td align="center" width="118">3.18</td>
 <td align="center" width="118">2.99</td>
 </tr>
 </tbody>
</table>

&nbsp;
Philadelphia Fed Nonmanufacturing Business Activity
Collapses 
by <a href="http://www.haver.com/comment/Moeller.html">Tom
Moeller</a>&nbsp;&nbsp;April 21, 2020
• New orders &amp; shipments turn negative.
• Employment decline weakens wages.
• Prices paid ease.
The Federal Reserve Bank of Philadelphia reported that its
Nonmanufacturing Business Index of current general activity at the company level
dropped to -82.5 during April after weakening to -12.8 in March. The index of
expected general activity similarly remained negative at -24.5.
Components of the company general activity index were all
weak this month. New orders figures again collapsed to -82.5 as only 0.3% of
firms reported improved new orders while a greatly increased 68% reported a
decline. The sales or revenue series fell m/m to -87.9. The index of unfilled
orders also went negative but the inventories measure rose slightly.
The labor market measures also collapsed in April. The
full-time permanent employment measure fell to -47.5, indicating by far a record
pace of job cutbacks. A greatly lessened 4% of firms reported increased hiring
while a surging 52% reported a decline. Part-time/temporary employee hiring again
was pulled back. The average workweek reading similarly collapsed. The wages
&amp; benefits measure turned negative.
Pricing power evaporated. The index of prices paid fell to
-0.4, down from 34.7 in December. A greatly lessened 15% of firms reported
higher prices while an increased nine percent indicated a decline, the most in
five years. Prices received also were significantly weakened.
The capital expenditure measures fell sharply. The physical
plant measure declined to the lowest level since October. The equipment &amp;
software expenditure reading also weakened to a four-month low.
The Philadelphia Fed figures are diffusion indexes which are
calculated by subtracting the percent of respondents reporting decreases in
business activity from those reporting improvement. So, readings above zero
indicate more positive than negative responses. These indexes have a good
correlation with growth in the series covered. The data are available in Haver's
SURVEYS database.&nbsp;&nbsp;&nbsp; 
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1376">Federal Reserve Bank of
 Philadelphia: Nonmanufacturing Business Outlook Survey (Diffusion Index,
 SA)</th>
 <th scope="col" width="70">Apr</th>
 <th scope="col" width="70">Mar</th>
 <th scope="col" width="70">Feb</th>
 <th scope="col" width="70">Apr'19</th>
 <th scope="col" width="70">2019</th>
 <th scope="col" width="70">2018</th>
 <th scope="col" width="71">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="1376">General Activity - Company</td>
 <td align="center" width="70">-82.5</td>
 <td align="center" width="70">-12.8</td>
 <td align="center" width="70">36.1</td>
 <td align="center" width="70">34.5</td>
 <td align="center" width="70">23.4</td>
 <td align="center" width="70">33.5</td>
 <td align="center" width="71">27.2</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; New Orders</td>
 <td align="center" width="70">-67.2</td>
 <td align="center" width="70">-16.4</td>
 <td align="center" width="70">28.1</td>
 <td align="center" width="70">21.0</td>
 <td align="center" width="70">16.7</td>
 <td align="center" width="70">24.2</td>
 <td align="center" width="71">19.1</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Sales or Revenue</td>
 <td align="center" width="70">-87.9</td>
 <td align="center" width="70">-4.9</td>
 <td align="center" width="70">39.8</td>
 <td align="center" width="70">34.0</td>
 <td align="center" width="70">24.0</td>
 <td align="center" width="70">30.8</td>
 <td align="center" width="71">27.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Inventories</td>
 <td align="center" width="70">1.9</td>
 <td align="center" width="70">-1.7</td>
 <td align="center" width="70">5.6</td>
 <td align="center" width="70">2.0</td>
 <td align="center" width="70">4.0</td>
 <td align="center" width="70">5.2</td>
 <td align="center" width="71">3.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Number of Full-Time Permanent
 Employees</td>
 <td align="center" width="70">-47.5</td>
 <td align="center" width="70">-1.7</td>
 <td align="center" width="70">21.5</td>
 <td align="center" width="70">18.7</td>
 <td align="center" width="70">20.9</td>
 <td align="center" width="70">18.1</td>
 <td align="center" width="71">14.8</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Part-Time/Temporary/Contract
 Employees</td>
 <td align="center" width="70">-58.9</td>
 <td align="center" width="70">-11.2</td>
 <td align="center" width="70">10.4</td>
 <td align="center" width="70">23.1</td>
 <td align="center" width="70">14.6</td>
 <td align="center" width="70">15.5</td>
 <td align="center" width="71">12.3</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Prices Paid</td>
 <td align="center" width="70">-0.4</td>
 <td align="center" width="70">6.0</td>
 <td align="center" width="70">21.3</td>
 <td align="center" width="70">26.4</td>
 <td align="center" width="70">25.0</td>
 <td align="center" width="70">28.3</td>
 <td align="center" width="71">21.4</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">&nbsp; Wage &amp; Benefit Costs</td>
 <td align="center" width="70">-35.7</td>
 <td align="center" width="70">26.6</td>
 <td align="center" width="70">30.7</td>
 <td align="center" width="70">37.0</td>
 <td align="center" width="70">39.4</td>
 <td align="center" width="70">40.1</td>
 <td align="center" width="71">33.5</td>
 </tr>
 <tr>
 <td class="firstcol" width="1376">Expected General Activity - Company</td>
 <td align="center" width="70">-24.5</td>
 <td align="center" width="70">-16.3</td>
 <td align="center" width="70">44.2</td>
 <td align="center" width="70">43.4</td>
 <td align="center" width="70">41.7</td>
 <td align="center" width="70">49.9</td>
 <td align="center" width="71">49.8</td>
 </tr>
 </tbody>
</table>

&nbsp;
U.S. Existing Home Sales Reach 2007 High with Increased
Prices in February 
by <a href="http://www.haver.com/comment/Moeller.html">Tom
Moeller</a>&nbsp;&nbsp; &nbsp;&nbsp; April 21, 2020
• Existing home sales weaken to xxx low.
• Sales declines are broad-based around the country.
• Prices weaken as inventory increases.
The National Association of Realtors (NAR) reported that
sales of existing homes during February jumped 6.5% (7.2% y/y) to 5.770 million
(AR) from 5.420 million in January, revised from 5.460 million. It was the
highest level of sales since February 2007. The Action Economics Forecast Survey
expected February sales of 5.52 million.
The median price of all existing homes sold increased 1.5%
(8.0% y/y) to $270,100 following a 3.0% January decline. The average sales price
improved 1.0% last month (6.0% y/y) to $305,800. These price data are not
seasonally adjusted.
Existing home sales were mixed around the country in
February. The increase in sales overall was paced by an 18.9% surge (11.5% y/y)
in the West to 1.260 million, the highest level since February 2007. Sales in
the South rose 7.2% (8.2% y/y) to 2.520 million, the highest level since October
2006, while sales in the Midwest edged 0.8% up (4.0% y/y). Sales in the
Northeast declined, however, by 4.1% (+2.9% y/y) to 700,000, the lowest level in
three months.
Sales of existing single-family homes strengthened 7.3% both
m/m and&nbsp; y/y to 5.170 million units after falling 1.8% in January. Sales of
condos and co-ops held steady (7.1% y/y) at 600,000 units.
The number of homes on the market decreased 9.8% y/y and
roughly equaled the record low. The month's supply of homes on the market
remained at 3.1 versus 3.6 one year earlier and roughly equaled the record low.
These inventory figures date back to 1999.
The data on existing home sales, prices and affordability are
compiled by the National Association of Realtors and can be found in Haver's USECON
database. The regional price, affordability and inventory data are available in
the REALTOR database. The expectations figure is from the Action
Economics Forecast Survey, reported in the AS1REPNA database.
<table width="1871" class="centered" border="0" cellSpacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="706">Existing Home Sales (SAAR,
 000s)</th>
 <th scope="col" width="165">Mar</th>
 <th scope="col" width="166">Feb</th>
 <th scope="col" width="166">Jan</th>
 <th scope="col" width="166">Mar Y/Y %</th>
 <th scope="col" width="166">2019</th>
 <th scope="col" width="166">2018</th>
 <th scope="col" width="166">2017</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="706">Total Sales</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">5,770</td>
 <td align="center" width="166">5,420</td>
 <td align="center" width="166">7.2</td>
 <td align="center" width="166">5,330</td>
 <td align="center" width="166">5,341</td>
 <td align="center" width="166">5,531</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">&nbsp;&nbsp; Northeast</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">700</td>
 <td align="center" width="166">730</td>
 <td align="center" width="166">2.9</td>
 <td align="center" width="166">687</td>
 <td align="center" width="166">689</td>
 <td align="center" width="166">735</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">&nbsp;&nbsp; Midwest</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">1,290</td>
 <td align="center" width="166">1,280</td>
 <td align="center" width="166">4.0</td>
 <td align="center" width="166">1,248</td>
 <td align="center" width="166">1,265</td>
 <td align="center" width="166">1,301</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">&nbsp;&nbsp; South</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">2,520</td>
 <td align="center" width="166">2,350</td>
 <td align="center" width="166">8.2</td>
 <td align="center" width="166">2,281</td>
 <td align="center" width="166">2,246</td>
 <td align="center" width="166">2,270</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">&nbsp;&nbsp; West</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">1,260</td>
 <td align="center" width="166">1,060</td>
 <td align="center" width="166">11.5</td>
 <td align="center" width="166">1,115</td>
 <td align="center" width="166">1,141</td>
 <td align="center" width="166">1,225</td>
 </tr>
 <tr class="even">
 <td class="firstcol" width="706">Single-Family Sales</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">5,170</td>
 <td align="center" width="166">4,820</td>
 <td align="center" width="166">7.3</td>
 <td align="center" width="166">4,754</td>
 <td align="center" width="166">4,742</td>
 <td align="center" width="166">4,907</td>
 </tr>
 <tr>
 <td class="firstcol" width="706">Median Price Total ($, NSA)</td>
 <td align="center" width="165"></td>
 <td align="center" width="166">270,100</td>
 <td align="center" width="166">266,200</td>
 <td align="center" width="166">8.0</td>
 <td align="center" width="166">269,783</td>
 <td align="center" width="166">257,267</td>
 <td align="center" width="166">245,950</td>
 </tr>
 </tbody>
</table>


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Robert Brusca

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<a href="/comment/200420e.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/200420e.png" align="left"></a>
In the EMU, neither exports nor imports show much zest. But exports had some life in their year-on-year trend and that is helping to drive a wider surplus in the EMU area. Broadly both exports and imports are fluctuating in relatively low ranges, but the key difference is that imports are generally fluctuating at low rates of contraction while exports are fluctuating at low rates of expansion. That plus/minus line makes all the difference in the world.

The trade balance and its three-month average are above the 12-month average and that is true of the current account as well. The EMU surpluses are sharply higher this month.

The reason is clear as exports grew by 1.8% while imports fell by 2.3% and created a powerful surge in the surplus which is the difference between these two flows. Interestingly both manufactured and nonmanufactured goods followed that same pattern in February,

EMU exports of nonmanufactured goods are surging, rising at a 48.9% annualized pace over three months, up steadily from a 13.6% pace over 12 months. On the import side, nonmanufactures are moving up too and accelerating from a -0.8% drop over 12 months to 4.6% gain over six months to an 11.4% pace of expansion over three months. Obviously, exports are dominating this net balance driving it to a sharply higher EMU surplus.

Manufactured goods show the same trend this time dominated by sinking EMU imports. On the export side, export growth does step up from a pace of 1.2% over 12 months to a pace of 5.6% over three months. But imports of manufactures that fall by 0.8% over 12 months decelerate and fall at an 8.4% annualized rate over three months dominating all trends in manufacturing.

These figures show that EMU exports are surviving, but that EMU domestic demand has dried up. Even the exports that are expanding and pulling in imports to support them, are not able to offset the impact of domestic demand weakness on imports. The sharp pullback in manufacturing imports helps to contract the trade deficit and to cushion the blow on EMU GDP growth.


<img border="0" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/200420.png" width="660" height="350">


Germany has been debating a domestic stimulus package and in a news report Angela Merkel is counseling for a smaller package lest southern European countries think Germany has the resources to help them too. Let there be no doubt that we are in a world of everyman for himself, obscured by some window-dressing of 'care' for our fellow man.

In this world, politics continue to play out in spades as U.S. President Trump has severed support for WHO because of its close ties and support of China that he sees as part of the reason that the pandemic spread so fast and has damaged his chance at reelection. In the U.K., there are calls to investigate the government's response, calls that are being set aside for another day. In the U.S., there is political infighting about support packages. Even candidate Joe Biden is trying to blame President Trump for being at fault because he was 'too close to China's Xi.'

Taiwan surprisingly reported a rise in export orders in March. The gain in Taiwan orders was rather broad based but not unequivocal. The report is for the month of March, a month in which significant weakness has emerged in most economies. Still, the growth in Taiwan's orders spans electronics, machinery, information and communications products led by a 23.8% jump in electronics. Many other categories showed declines. But Taiwan's numbers do seem to show that perhaps the tech-most aspect of economies are still vibrant especially with 'sheltering at home' and the need for technology equipment to permit and enhance that. While travel and leisure sectors are flat on their back, technology still has life and we can see that in the global equity market indexes and share prices where so many true tech companies have lost little or no ground in this selloff.

However, the overarching view is that global growth is weak and will remain so. A handful of countries are planning to reduce their lockdowns and think they may have passed the peak of the crisis. Still, those counties will move slowly and cautiously. Anyone looking for a V-shaped recovery will have to try a different planet.

In the U.S. talks, arguments and exposés are in vogue about the ongoing government programs and plans for new ones or just plans to top-up existing programs, just like in Germany. Australia has challenged China to tell the truth about what happened and it has been rebuked with China telling countries not to meddle in its affairs. This position by China will be resisted. China has no scope to call this 'its affair' when its public health failure has spawned a pandemic that has infected and killed people in nearly every country on earth. I think this crisis will put an end to China's obstinance or to the increased role it has been playing in the global economy. Something very significant has got to give and China needs to open up or to damp down its ambitions.


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In the EMU, neither exports nor imports show much zest. But exports had some life in their year-on-year trend and that is helping to drive a wider surplus in the EMU area. Broadly both exports and imports are fluctuating in relatively [...]

EMU Trade Surpluses Expand As the Virus Swirls

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	 <a href="/comment/200420b.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/200420b.png"></a>

&bull; The Federal Reserve Bank of Chicago indicated that the economy entered a downturn in the wake of the COVID-19 outbreak.


The National Activity Index (CFNAI) declined
to -4.19 during March from 0.06 in February, revised from 0.16. The three-month
moving average of the index fell m/m to -1.47, its weakest level since June
2009. During the last 20 years, there has been a 71% correlation between
the Chicago index and the q/q change in real GDP.

Each of the four component series of the index turned
negative last month. The Production &amp; Income series fell to a record low of
-2.72. The Employment, Unemployment &amp; Hours series declined to -1.23,
the weakest reading since April 2009. The Personal Consumption &amp; Housing gauge
fell to -0.19, the lowest level since December 2018. The Sales, Orders and
Inventories of -0.05 compared to -0.06 in February.

The diffusion index of the CFNAI, which measures the breadth
of component change, fell sharply to -0.32, its lowest reading since May 2016.

The CFNAI is a weighted average of 85 monthly indicators of
national economic activity. It is constructed to have an average value of zero
and a standard deviation of one. Since economic activity tends toward trend
growth rate over time, a positive index reading corresponds to growth above
trend and a negative index reading corresponds to growth below trend.

These figures are available in Haver's SURVEYS database.

Do Stay-at-Home Orders Cause People to Stay at Home?
Effects of Stay-at-Home Orders on Consumer Behavior from the Federal Reserve
Bank of Chicago is available <a href="https://www.chicagofed.org/publications/working-papers/2020/2020-12">here</a>.

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<table class="centered" width="100%" border="0" cellspacing="0">
	<colgroup><col><col><col><col><col><col><col><col></colgroup>

 <thead>
 <tr>
 <th class="firstcol" scope="col" >Federal Reserve Bank of
 Chicago</th>
 <th scope="col" >Mar</th>
 <th scope="col" >Feb</th>
 <th scope="col" >Jan</th>
 <th scope="col" >Mar '19</th>
 <th scope="col" >2019</th>
 <th scope="col" >2018</th>
 <th scope="col" >2017</th>
 </tr>
 </thead>
 <tbody>
 <tr class="odd">
 <td class="firstcol" >National Activity Index (+ = Growth
 Above Trend)</td>
 <td>-4.19</td>
 <td>0.06</td>
 <td>-0.27</td>
 <td>-0.04</td>
 <td>-0.23</td>
 <td>0.15</td>
 <td>0.17</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp; Production &amp; Income</td>
 <td>-2.72</td>
 <td>0.06</td>
 <td>-0.30</td>
 <td>-0.03</td>
 <td>-0.16</td>
 <td>0.10</td>
 <td>0.09</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp; Employment, Unemployment
 &amp; Hours</td>
 <td>-1.23</td>
 <td>0.07</td>
 <td>0.04</td>
 <td>0.02</td>
 <td>-0.01</td>
 <td>0.10</td>
 <td>0.07</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp; Personal Consumption &amp;
 Housing</td>
 <td>-0.19</td>
 <td>-0.02</td>
 <td>0.03</td>
 <td>0.02</td>
 <td>-0.03</td>
 <td>-0.06</td>
 <td>-0.05</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp; Sales, Orders &amp;
 Inventories</td>
 <td>-0.05</td>
 <td>-0.06</td>
 <td>0.04</td>
 <td>-0.05</td>
 <td>-0.04</td>
 <td>0.02</td>
 <td>0.06</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp; 3-Month Moving Average</td>
 <td>-1.47</td>
 <td>-0.20</td>
 <td>-0.06</td>
 <td>-0.24</td>
 <td>--</td>
 <td>--</td>
 <td>--</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Diffusion Index</td>
 <td>-0.32</td>
 <td>-0.21</td>
 <td>-0.07</td>
 <td>-0.20</td>
 <td>-0.15</td>
 <td>0.16</td>
 <td>0.09</td>
 </tr>
 </tbody>
 </table>
 
</body></html>

• The Federal Reserve Bank of Chicago indicated that the economy entered a downturn in the wake of the COVID-19 outbreak. The National Activity Index (CFNAI) declined to -4.19 during March from 0.06 in February, revised from 0.16. The [...]

Chicago Fed National Activity Index Signals Recession

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&bull; Record decline of 6.7% in leaders reflects widespread effects from coronavirus.


&bull; Coincident indicators signal nascent recession.


&bull; Lagging indicators confirm large downshift in economy.


The Conference Board reported that its Composite Index of Leading Economic
Indicators declined an historic 6.7% (-6.5% y/y) during March following a 0.2%
February decrease, revised from 0.1%. A 7.0% decline had been expected in the Action
Economics Forecast Survey. The series is comprised of 10 components which tend
to precede changes in the overall economy.

Last month's weakness reflected widespread declines amongst
the component series. The largest negative contribution came from higher initial
unemployment insurance claims which accounted for 5.5 percentage points of the
total's decline. Lower stock prices and building permits also contributed
negatively, as did the length of the average workweek and the ISM new orders
index. Consumer expectations for business/economic conditions fell slightly.
Factory orders for consumer goods &amp; materials, and nondefense capital goods
orders had little effect on the total's change nor did the leading credit index.
The interest rate spread between 10-year Treasuries and Fed funds made a slight positive contribution.

Three-month growth in the leading index weakened to -23.5%
(AR), the slowest since January 2009 when the economy was in the midst of recession.

The Index of Coincident Economic Indicators declined 0.9%
last month (+0.3 y/y) following an unrevised 0.3% gain during February. A
decline in industrial production had the largest negative effect on the index
followed by reduced payroll employment. Personal income less transfer payments
and manufacturing &amp; trade sales made slight positive contributions to the index change.

Three-month growth in the coincident index deteriorated to
-2.2% (AR), its weakest since March 2013.

The Index of Lagging Economic Indicators strengthened 1.2%
(2.6% y/y) in March after a 0.3% February gain, revised from 0.4%. Contributing positively to the index
change were the average duration of unemployment and commercial &amp; industrial
loans outstanding. The prime rate charged by banks and
growth in the services CPI exhibited sharply negative effects. Other series had
little influence on the lagging index change.

Three-month growth in the lagging index surged to 6.0% (AR).

The ratio of coincident-to-lagging economic indicators is
considered another leading indicator of economic activity. It plunged to 96.7,
its lowest level since May 1961 which preceded several years of positive
economic growth.

The Conference Board figures are available in Haver's BCI
database; the components are available there, and most are also in USECON.
The expectations are in the AS1REPNA 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.

A Time for Bold Action from John C. Williams,
President &amp; CEO Federal Reserve Bank of New York is available
<a href="https://www.newyorkfed.org/newsevents/speeches/2020/wil200416">here</a>.

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	<colgroup><col><col><col><col><col><col><col><col></colgroup>

 <thead>
 <tr>
 <th class="firstcol" scope="col" >Business Cycle Indicators (%)</th>
 <th scope="col" >Mar</th>
 <th scope="col" >Feb</th>
 <th scope="col" >Jan</th>
 <th scope="col" >&nbsp;Y/Y</th>
 <th scope="col" >2019</th>
 <th scope="col" >2018</th>
 <th scope="col" >2017</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" >Leading</td>
 <td>-6.7</td>
 <td>-0.2</td>
 <td>0.4</td>
 <td>-6.5</td>
 <td>1.6</td>
 <td>5.7</td>
 <td>3.9</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Coincident</td>
 <td>-0.9</td>
 <td>0.3</td>
 <td>0.1</td>
 <td>0.3</td>
 <td>1.8</td>
 <td>2.5</td>
 <td>2.2</td>
 </tr>
 <tr>
 <td class="firstcol" >Lagging</td>
 <td>1.2</td>
 <td>0.3</td>
 <td>-0.1</td>
 <td>2.6</td>
 <td>2.8</td>
 <td>2.5</td>
 <td>2.4</td>
 </tr>
	 </tbody>
	 </table>
	 
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• Record decline of 6.7% in leaders reflects widespread effects from coronavirus. • Coincident indicators signal nascent recession. • Lagging indicators confirm large downshift in economy. The Conference Board reported that its [...]

U.S. Leading Economic Indicators Plunge

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Japan's industrial production fell by 0.3% in February after two straight months of gains with January having been especially strong.

Mixed trends 
Japan's industrial production trend has two distinct aspects. From 12-months to six-months to three-months, industrial production is generally accelerating. That is true for overall IP for manufacturing, for intermediate goods and for investment goods output. That same sequence of growth also holds for mining. However, the graph shows year-on-year trends and despite some trimming of losses in early-2020 all year-on-year sector trends continue to point lower. So Japan has this short-term-longer term trend divergence.

Surreal trends 
Because January output was so strong, the quarter-to-date gains are positive and strong across all sectors with manufacturing up at a 9.1% annual rate two months into Q1. But these figures seem surreal compared to what is going on in the real world in real time.


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Challenges 
Japan is fighting off the coronavirus and undergoing some substantial stay-at-home edicts. Also just today, China, Japan's largest trading partner, reported a substantial decline in its GDP of -6.8%, the first it has ever reported (quarterly Chinese GDP data only date to 1992). And the U.S., Japan's second-largest trading partner, is currently in a coronavirus inspired 'economic-coma' as it tries to fend off spread of the virus and has accepted economic weakness as the cost. Of course, in such circumstances, it is hard to take the upbeat Japanese short-term trends seriously...or as sustainable.

Global and regional issues 
The IMF is reporting a projection of a 3% decline in global growth for the year and the Asian Development Bank (ADB) has cut back its outlook for the region. The daily count of coronavirus infections and deaths continues to rise in Southeast Asia with Indonesia now leading the pack, having just surpassed the Philippines for the largest number of cases in the region. Clearly Japan is surrounded by weakness and other issues.

Domestic issues add to the woes 
At home Japan's own tertiary index, an index of the services sector that is nearly a wholly domestic measure, fell by 0.5% in February. Between that sort of domestic weakness, newly implemented stay-at-home policies from Prime Minister Abe, and economic weakness all around the region and in the global economy, we can look for economic weakness in the coming month on the industrial front in Japan as well.

Assessment 
What we do see is that Japan's economy had regained some footing before the tsunami of economic weakness hit it as it surely did in March. But with the U.S. economy just entering its down phase as suggested by the U.S. March index of leading indicators falling by 6.7%, Japan's fate to weakness is more or less sealed, regardless of what the trends show. U.S. weakness is oncoming and China's recovery will be slow acting. Japan will be caught in that very unpleasant environment. And it will have to deal with its own virus issues that are looking more serious.

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Japan's industrial production fell by 0.3% in February after two straight months of gains with January having been especially strong. Mixed trends Japan's industrial production trend has two distinct aspects. From 12-months to six- [...]

Japan's IP Falls in February...It's Only the Beginning

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

Stable job openings and hiring rates point to cautious hiring

Global freight costs are on the rise while supply chain pressures are contained

Accelerating positive economic surprises in the G10 are boosting the global economy

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260622E.jpg

Danish consumer confidence rose to -14 in June from -19.8 in May, a small pickup for a still-negative net reading. In June, the reading has a standing at its 7.9 percentile on data back to 1995. So, this confidence headline still has a lower 8% reading overall.

On the month, all seven component readings improved compared to May, although the environmental assessments were little changed across four components. As for the environment, the most changed reading is the improved favorability of the time to save, a metric that is not always a positive category.

As for the seven categories, the readings on the financial situation, general economy and the unemployment rate all improved month-to-month, while the inflation metrics both backed down sharply.

These changes show the financial situation and general economy gauges all at rankings in the lower 20th percentiles, with the outlook for the next 12 months having a standing in their lower 10th percentiles and lower for both the financial situation and the general economy.

Consumer prices, despite a strong monthly step-back, have a 90.2 percentile standing for prices over the past 12 months and a 94.3 percentile standing for the CPI over the next 12 months. Despite some let-up in concerns about unemployment, the unemployment gauge has an 85.1 percentile standing, still substantially elevated.

The environmental readings are less negative, starting with the ‘favorability of the time to purchase,’ a bit weaker month-to-month but improved on balance over two months. The June reading is slightly better than its 12-month average but still has a ranking only in its 21st percentile. The favorability of the time to purchase over the next 12 months is a tick weaker month-to-month and about a point worse than its 12-month average. Its June ranking is in its lower 10th percentile of its historic queue. The favorability of the time to save has a stronger ranking, but this is a more equivocal category. It is improved month-to-month and only slightly stronger over two months The June reading is stronger than its 12-month average, with a ranking in its 47.6 percentile—improved compared to previous categories but still worse than its historic median since 1995 (the median occurs at a ranking of 50%). The ‘general financial situation of households now’ ticked lower in June from May but is stronger on balance over two months. The June reading is above its 12-month average and has a 59.2 percentile standing—above its median.

On balance, Denmark shows improving confidence, progressing slowly but on the right path. There is a sharp downward adjustment in inflation, especially over the next 12 months, despite global conditions. Still, the ranking of the confidence metrics are uniformly weak.

260622.jpg

Denmark

Danish Confidence Improves As Inflation Expectations Pull Back Sharply

Andrew Cates

**US Outperformance Holds; Europe and China Continue to Disappoint**
One of the most persistent features of the global macro landscape in 2026 has been the widening divergence between growth outcomes in the United States and those in Europe and China. Citigroup’s global growth surprise indices—which measure the gap between actual economic releases and consensus expectations—capture this divergence with unusual clarity. US data have continued to surprise on the upside, supported by resilient consumer spending, a stronger-than-expected labour market and the ongoing AI-driven capital spending boom. The picture elsewhere is less encouraging. Growth surprises have turned negative across the euro area, reflecting the cumulative toll of elevated energy costs, weak industrial activity and subdued business confidence. And China's growth surprise index has also fallen sharply in recent weeks, with weaker-than-expected retail sales and fixed asset investment data for May this week reinforcing concerns that domestic demand remains fragile and that policy support is yet to gain meaningful traction.

260618Z1.jpg

**The Oil Risk Premium in the UK Has Been Fading**
One of the more notable features of UK markets this year has been the close relationship between oil prices and two-year gilt yields. The link is not mechanical, but in an economy heavily exposed to imported energy, swings in oil prices can materially alter the inflation outlook and, by extension, expectations for Bank of England policy. That relationship was on display again this week. A softer-than-expected UK CPI reading for May—helped in part by easing energy price pressures—led investors to scale back expectations that inflation would remain persistently above target, pushing two-year gilt yields to their lowest level in six weeks. The question now is whether this marks the start of a more sustained easing in inflation pressures or merely a temporary reprieve. Much will depend on whether the recent decline in oil prices following the US-Iran ceasefire agreement proves durable.

260618Z2.jpg

**The AI Investment Boom Is Rewriting the Rule Book for the Chip Industry**
If the divergence in global growth surprises noted above tells a story of a world economy under strain, the semiconductor sales data tell a very different one — of a technology-driven investment cycle that is accelerating almost regardless of the broader macro environment. Global semiconductor sales have surged to record levels over the past twelve months, driven primarily by insatiable demand for the chips that underpin AI infrastructure: graphics processing units, high-bandwidth memory, and advanced logic chips. Data centre capital expenditure from the hyperscalers continues to exceed even the most optimistic forecasts from a year ago, and the investment pipeline shows no sign of moderating. The gains are concentrated in AI-adjacent products; legacy chips for consumer electronics and industrial applications remain relatively soft.

260618Z3.jpg

**Copper Holds Firm As Oil Retreats**
The commodity markets are telling two quite different stories this week, and the contrast is instructive. Oil has moved sharply lower on the US-Iran MoU news as investors trim the conflict risk premium that has been embedded in energy markets since March — a welcome development for inflation and central bank optionality alike. But the three commodities shown in this chart tell a different story. Copper, one of the most reliable proxies for global electricity infrastructure investment, remains near multi-year highs, reflecting the extraordinary volume of data centre construction, grid expansion and electrification spending flowing through the global economy. Aluminium — energy-intensive to produce and increasingly in demand for the structural components of both data centres and electric vehicles — has, until quite recently, held its ground. Lithium hydroxide, the battery-grade refining product that sits at the heart of the energy storage supply chain, has seen some cyclical softness but remains structurally underpinned by the scale of demand being projected for grid-scale storage and electric mobility over the next decade.

260618Z4.jpg

**Is Energy Availability a Binding Constraint on Growth?**
This next chart is a scatter plot that maps electricity generation per capita against GDP growth per capita across a broad sample of countries over the past five years. The positive relationship is striking. Economies with higher electricity generation per capita, including the United States, have generally delivered stronger GDP growth, while those with more constrained electricity systems have tended to lag. The obvious objection is reverse causality: richer economies generate more electricity because they have more to power. That is partly true. But the broader evidence is difficult to dismiss. The US shale revolution delivered an abundance of cheap energy that supported a sustained period of industrial outperformance relative to many advanced economies. Mainstream commentary often attributed this advantage to factors such as labour market flexibility or technological innovation, but energy costs were arguably at least as important.

260618Z5.jpg

**Corporate America Is Investing from a Position of Unusual Financial Strength**
The surge in US corporate investment—particularly in AI infrastructure, data centres and semiconductors—has inevitably drawn comparisons with the late-1990s dot-com boom. Yet the financial balance data suggest an important difference. During the dot-com era, US non-financial corporates moved into a financial deficit approaching 4% of GDP, relying heavily on external financing to fund investment. Today, despite another ambitious investment cycle, the sector remains in surplus, currently around 1.8% of GDP. Corporate America is investing aggressively, but it is still generating more cash than it is spending. The boom is being financed largely through profits rather than debt. Risks remain—not least the growing fiscal burden on the federal government—but the balance-sheet fragilities that turned previous investment booms into systemic crises appear far less pronounced. If a major constraint emerges in the years ahead, it may be energy and resources rather than leverage.

260618Z6.jpg

The signing of a Memorandum of Understanding (MoU) between the United States and Iran earlier this week has offered financial markets their most significant moment of geopolitical relief since the Middle East conflict escalated in early March. Oil prices fell sharply on the news, short-dated bond yields moved lower across several major economies, and risk assets recovered ground. But relief, as investors have learnt repeatedly over the past three months, is arguably not the same as resolution. The MoU sets a framework for negotiations rather than a final settlement, and the history of US-Iran diplomacy is not one that encourages complacency. Meanwhile, the Federal Reserve — concluding its June meeting yesterday under new chair Kevin Warsh — held rates steady but delivered a distinctly hawkish dot plot that shifted the median year-end projection from a cut to a hike, a reminder that the easing cycle the market had been pricing is no longer the base case. Against this backdrop, this week's charts take stock of where the global economy presently stands — and what the underlying data, beneath the geopolitical noise, are telling us. The picture that emerges is one of divergence. The United States continues to outperform consensus growth expectations while Europe and China disappoint (chart 1). UK short-dated yields have tracked oil prices with unusual consistency this year, and today's softer-than-expected CPI print for May — arriving just as the MoU has knocked crude lower — potentially changes the policy calculus for the Bank of England (chart 2). Global semiconductor sales, meanwhile, are storming ahead regardless of the geopolitical noise, powered by AI infrastructure spending that shows no sign of fatigue (chart 3). A cross-section of commodity prices tells two stories simultaneously: the geopolitical risk premium is draining out of oil, but the metals and materials the AI economy actually needs — copper, uranium, critical minerals — are holding firm (chart 4). Meanwhile a cross-country scatter of electricity generation and GDP growth over the past five years raises a question that deserves more attention than it typically gets: is energy availability a constraint on growth, or merely a consequence of it? The evidence, we would argue, points firmly in one direction (chart 5). And finally, for all the comparisons being drawn between the current investment boom and the late 1990s, the financial balance of the US corporate sector tells a rather different story — one that matters for how any correction might unfold (chart 6).

<iframe data-testid="embed-iframe" style="border-radius:12px" src="https://open.spotify.com/embed/episode/7rw2v1Ri8gUVHbFrZfgANL?utm_source=generator&si=75d98727e9524d75" width="100%" height="152" frameBorder="0" allowfullscreen="" allow="autoplay; clipboard-write; encrypted-media; fullscreen; picture-in-picture" loading="lazy"></iframe>

Charts of the Week: Between Relief and Reality

Winnie Tapasanun

260618N12.jpg

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The current general activity diffusion index rebounded to a slightly stronger-than-expected 10.3 in June following a 27.1-point drop to -0.4 in May, the latest Manufacturing Business Outlook Survey (MBOS) from the Federal Reserve Bank of Philadelphia showed, indicating a return to expansion in manufacturing activity in the Third Federal Reserve District this month. A reading of 10.0 for June had been expected by the Action Economics Forecast Survey. June marked the fifth m/m increase in six months, showing a sharp improvement from -1.4 in June 2025. In June, 32.1% of firms reported increases in current general activity (up from 22.5% in May), while 21.9% reported decreases (down from 22.9%); 45.4% reported no change (down from 54.6%). Survey responses were collected from June 8 to June 15.

Haver Analytics calculates an ISM-adjusted current activity diffusion index from five key components using the methodology along the lines of the national ISM index. The index rose to 53.1 in June after a 4.8-point decline to a contraction-level 49.7 in May, indicating manufacturing activity expanded for the third time in four months; it was slightly above 51.0 in June 2025.

In the latest survey, the new orders index surged to 27.3 in June following a 34.7-point plunge to -1.7 in May, signaling new orders expanded for the sixth time in seven months. The shipments index rebounded to 14.9 this month from 4.9 in May, registering the seventh consecutive expansion. The unfilled orders index advanced to 10.5 from -2.5, indicating expansion for the first time since July 2025 and the highest level since January 2025. In contrast, the inventories index dropped to -8.5 in June from 6.6 in May, showing inventories contracted for the second time in three months and at the lowest level since July 2024. Meanwhile, the delivery times index increased to -2.6 this month from -10.4 in May (the lowest reading since March 2024).

On the labor front, the number of employees index climbed to 7.9 in June from -2.8 in May, indicating employment expanded for the first time in three months and at the highest level since January. In June, a higher 17.0% of respondents reported increases in employment, while 9.2% reported declines; 73.8% reported no change in employment levels. The average employee workweek index fell to -6.5 this month, the first negative reading and lowest since February, from 1.2 in May.

Inflation indicators were mixed in June. The prices paid index rose to 53.2 this month following an 11.4-point drop to 47.9 in May. A higher 53.5% of respondents reported increases in input prices in June, while only 0.4% reported decreases. The prices received index fell to 20.3, a four-month low, after a 7.2-point May decline to 26.3. In June, 20.3% of respondents reported increases in prices received, while 0.0% reported decreases.

The future indexes remained in positive territory, signaling continued overall growth over the next six months, with most future indicators rising. The future general activity diffusion index edged down to 50.2 in June from 53.2 in May, staying positive since February 2024. Future indexes for new orders (60.8 vs. 53.5) and shipments (60.3 vs. 45.7) increased in June (vs. May) and remained positive. Notably, the future capital expenditures index rose to 41.2 this month, the highest level since June 2021, from 30.9 in May. The following future indexes slipped in June (vs. May) but stayed in positive territory: employment (30.8 vs. 31.7), unfilled orders (17.3 vs. 19.2), and inventories (10.0 vs. 11.8). Prices continued to increase, with the future prices paid index easing to a still-elevated 63.2 in June from 70.0 in May and the future prices received index rising to 67.2, the highest level since August 2021, from 60.5.

The Manufacturing Business Outlook Survey (MBOS), conducted by the Federal Reserve Bank of Philadelphia, is a monthly survey of manufacturers in the Third Federal Reserve District. Participants indicate the direction of change in overall business activity and in the various measures of activity at their plants. The diffusion indexes in the MBOS represent the percentage of respondents indicating an increase minus the percentage indicating a decrease. The indexes range from -100 to +100 with positive values indicating an increase in activity. The series from the survey dating back to May 1968 can be found in Haver’s **SURVEYS** database. The expectations forecast figures are from the Action Economics Forecast Survey in **AS1REPNA**.

260618P12.jpg

260618Q12.jpg

- Current General Activity Index up 10.7 pts. to 10.3 in June; fifth rise in six months.
- New Orders (27.3), sixth expansion in seven mths.; Shipments (14.9), seventh straight expansion; Unfilled Orders (10.5), first expansion since July ’25.
- Employment (7.9), a five-month high after two mths. of contraction.
- Inflation indicators: Prices Paid up (53.2); Prices Received down (20.3, a four-month low).
- Future General Activity Index down to a still-expansion-level 50.2; most subindexes up and positive; future price indexes remaining above long-run avgs.

U.S. Philadelphia Fed Index Returns to Positive Territory in June

260618E.jpg

Unemployment in the European Monetary Union stayed at 6.3% in April, just a tick above its all-time low. In the more inclusive EU, the unemployment rate hovered at 6%, just two tenths of a percentage point above its all-time low. Unemployment conditions in the monetary union remain low without many signs of acceleration.

The unemployment rate in April fell in Italy, Ireland, Greece, Portugal, and the Netherlands. The unemployment rate increased month-to-month in Finland.

In March, the unemployment rate declined in Austria, Belgium, Germany, Finland, Italy, and the Netherlands. It rose month-to-month in Greece and Luxembourg.

Over three months, the unemployment rate in these 12-early reporting monetary union members fell in five countries: Belgium, Germany, Italy, Ireland, and the Netherlands. In contrast, unemployment rose in five countries: Portugal, Greece, France, Finland, and Austria.

Over six months, unemployment rates fell in six countries: the Netherlands, Portugal, Italy, Germany, Belgium, and Austria. This was against increases in six countries: Greece, Finland, France, Luxembourg, Spain, and Ireland.

Year over year, the degree of inflation progress is much thinner, with the unemployment rates falling in only three countries Italy, Spain, and Portugal with increases in unemployment for all the other countries in the table.

Unemployment rates continue to rank low in the monetary union, with only three monetary union countries having their unemployment rates ranked above 50%, putting them above their respective medians on data back to the year 2000. Those three countries are Luxembourg, Finland, and Austria. For the remaining countries, the rankings of their unemployment rates over this period are not even as high as their 30th percentiles. Italy, at present, is experiencing its lowest unemployment rate of the period.

Unemployment conditions in the monetary union remain solid. The past two weeks were significant for monetary policy and global economics, with the ECB raising rates, Japan raising rates, and the United States keeping rates unchanged but moving away from an easing bias in policy that had been in effect for quite a number of months. Today the Bank of England, after experiencing some significant inflation progress, decided to keep its policy on hold for another session. An agreement between the U.S. and Iran securing an opening of the Strait of Hormuz was signed, paving the way for potentially improved oil flows, lower inflation, and less uncertainty in the period ahead.

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Europe

EMU Unemployment Remains Low

Sandy Batten

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Total retail sales rose a much larger-than-expected 0.9% m/m (6.9%y/y) in May following a slightly downwardly revised 0.4% monthly gain in April (previously 0.5% m/m), according to data released by the U.S. Census Bureau. The Action Economics Forecast Survey looked for a 0.5% m/m gain. Excluding autos, other sales increased 0.8% m/m (7.5% y/y) after an unrevised 0.7% m/m increase in April. Expectations were for a 0.5% monthly rise.

Elevated retail gasoline prices continued to boost the value of gasoline sales in May. Gasoline sales increased 3.4% m/m (26.5% y/y) in May on top of a 2.8% m/m increase in April. However, both monthly increases were slower than the 14.2% monthly jump reported in March. Gasoline sales accounted for 31% of total sales in May. However, sales were solid even without gasoline sales. Total sales excluding gasoline rose 0.7% m/m in April, up from 0.2% m/m in April. Sales excluding both autos and gasoline increased 0.5% m/m in May, the same monthly gain as in April.

The control group of sales (total sales excluding food services, autos, gasoline and building materials that the BEA uses to construct PCE in the national accounts) posted another solid increase in May, rising 0.7% m/m (6.3% y/y) following an unrevised 0.5% monthly increase in April. The strong performance at the end of Q1 followed by solid gains in April and May put the April-May level of control group sales up 8.6% at an annual rate from the Q1 average, pointing to another solid contribution by consumption to overall GDP growth in Q2. Consumer spending remains surprisingly resilient notwithstanding the recent hit to disposable income from the marked increase in energy prices.

Sales generally increased across major sectors in May. Auto sales rebounded, rising 1.2% m/m in May and more than reversing the 0.9% monthly decline in April. This was the third gain in auto sales in the past four months. Furniture sales rose 1.0% m/m but sales at electronics and appliance stores slipped 0.5% m/m. Building material sales gained 1.0% m/m on top of a 1.1% monthly increase in April. Clothing sales rose 0.3% m/m. Sales at general merchandise stores gained 0.4% m/m in May. Miscellaneous sales jumped 2.3% m/m in May, their first monthly gain in three months. Sales by nonstore retailers continued their strong performance, increasing 1.5% m/m in May on top of a 1.1% monthly rise in April. Over the first five months of this year, nonstore retail sales have risen 7.2%, not annualized. By contrast, food sales were unchanged in May from April while sales at restaurants edged down 0.1% m/m in May, their first monthly decline in four months.

Retail sales data can be found in Haver’s **USECON** database. The expectations figures are from the Action Economics Forecast Survey in **AS1REPNA**.

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- Total sales increased 0.9% m/m in May, nearly twice expectations.
- Auto sales rebounded, rising 1.2% m/m in May, more than reversing a 0.9% monthly decline in April. 
- Gasoline sales rose 3.4% m/m in May.
- Excluding auto and gasoline sales, remaining sales increased by a solid 0.5% m/m in May, the same monthly increase as in April.
- Sales of the retail control group that is used to construct PCE rose 0.7% m/m in May and are 8.6% annualized above the Q1 average.

Economy in Brief

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