Robert Brusca

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
<style>
.odd{
background-color:#edf5ff;
}
.even{
background-color:#dde5ef;
}
.grey1{
background-color:#f0f0f0;
}
.grey2{
background-color:#e2e2e2;
}
.grey3{
background-color:#d4d4d4;
}
.grey4{
background-color:#c6c6c6;
}
.grey5{
background-color:#b8b8b8;
}
</style>
</head>
<body>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517d.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>The UK CBI index improved sharply and much more sharply than
expected in May. The orders index jumped from a -36 reading to -18,
remaining negative but halving its negative reading. The result was
completely unexpected. Export orders have improved to the point where
their reading is positive for the first time since early 2008. The
overall all orders index has just made the largest jump month to month
since at least 1989.</p>
<p>The 3-month-ahead volume outlook index improved this month to
a net balance reading of +17 from +14 in April. April has seen a big
boost to +14 from +5 in March. The outlook volume index stands in the
77th percentile of its range which is a pretty strong standing. The
export reading has tied its high since 1996 and has seen no higher
reading since August of 1995.</p>
<p>This sort of industrial turnaround could put the BOE on the
defensive. UK inflation data have not been good. But if the economy
shows signs of strength the inflation data could come to have a more
pejorative interpretation.</p>
<p>For now the rise in the industrial in orders index is sharp
but only brings it to a reading of -18. Still that is a 58th percentile
reading and, by itself, that is not as weak-sounding to me as a minus
eighteen scoring sounds. So the BOE has balance for now. The industrial
sector seems to be making a push but it is still showing a lot of
weakness. Still, the main point stands. The stronger that the
industrial sector and the rest of the economy gets, the more that any
inflation overshoot will begin to worry the BOE.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="11" scope="col"><b>UK
Industrial volume data CBI Survey</b> </th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Reported:</td>
<td>May<br>
10</td>
<td>Apr<br>
10</td>
<td>Mar<br>
10</td>
<td>Feb<br>
10</td>
<td>Jan<br>
10</td>
<td>12MO Avg</td>
<td>Pcntle</td>
<td>Max</td>
<td>Min</td>
<td>Range</td>
</tr>
<tr>
<td class="firstcol">Total Orders</td>
<td>-18</td>
<td>-36</td>
<td>-37</td>
<td>-36</td>
<td>-39</td>
<td>-47</td>
<td>58%</td>
<td>13</td>
<td>-61</td>
<td>74</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Export
Orders</td>
<td>3</td>
<td>-16</td>
<td>-18</td>
<td>-23</td>
<td>-33</td>
<td>-40</td>
<td>77%</td>
<td>20</td>
<td>-55</td>
<td>75</td>
</tr>
<tr>
<td class="firstcol">Stocks:FinGds</td>
<td>10</td>
<td>10</td>
<td>5</td>
<td>12</td>
<td>13</td>
<td>16</td>
<td>36%</td>
<td>31</td>
<td>-2</td>
<td>33</td>
</tr>
<tr style="font-weight: bold;" class="odd">
<td colspan="11" class="firstcol">Looking
ahead</td>
</tr>
<tr>
<td class="firstcol">Output Volume:Nxt
3M</td>
<td>17</td>
<td>14</td>
<td>5</td>
<td>7</td>
<td>4</td>
<td>-3</td>
<td>77%</td>
<td>36</td>
<td>-48</td>
<td>84</td>
</tr>
<tr>
<td class="firstcol">Avg Prices 4Nxt 3m
</td>
<td>16</td>
<td>17</td>
<td>8</td>
<td>8</td>
<td>-6</td>
<td>-3</td>
<td>69%</td>
<td>37</td>
<td>-30</td>
<td>67</td>
</tr>
<tr class="odd">
<td colspan="11" class="firstcol">From early 1989 </td>
</tr>
</tbody>
</table>
</body></html>

The UK CBI index improved sharply and much more sharply than expected in May. The orders index jumped from a -36 reading to -18, remaining negative but halving its negative reading. The result was completely unexpected. Export orders [...]

UK CBI Trends Are Up

Tom Moeller

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
<style>
.odd{
background-color:#edf5ff;
}
.even{
background-color:#dde5ef;
}
.grey1{
background-color:#f0f0f0;
}
.grey2{
background-color:#e2e2e2;
}
.grey3{
background-color:#d4d4d4;
}
.grey4{
background-color:#c6c6c6;
}
.grey5{
background-color:#b8b8b8;
}
</style>
</head>
<body>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517a.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>Recent improvement in business conditions in the Northeast
region of the country lost momentum this month. The Federal Reserve
Bank of New York reported that its May <b>Empire State Factory
Index of General Business Conditions</b> fell to 19.11, its
lowest level this year. Nevertheless, the May level suggests positive
growth in factory sector activity but it fell short of Consensus
expectations for a reading of 30.0.</p>
<p>The figure is a diffusion index. Since the series' inception
in 2001, there has been a 75% correlation between its level and the
three-month change in U.S. factory sector production. Like the
Philadelphia Fed Index of General Business Conditions, the Empire State
Business Conditions Index reflects answers to independent survey
questions; it is not a weighted combination of the components. The
series dates back only to 2001.</p>
<p>Deterioration amongst the separate survey questions was
widespread this month including new orders, shipments and inventories.
The employment index, however, improved to 22.37 which was the series'
highest level. Since inception there has been an 87% correlation
between the employment index and the three-month growth in factory
sector employment as reported by the Labor Department.</p>
<p>Continuing it earlier upward momentum, the prices paid index
rose to 44.74, its highest since September 2008. Since inception there
has been a 76% correlation between the index of prices paid and the
three-month change in the core intermediate materials PPI.</p>
<p>The Empire State <b>index of expected business
conditions in six months</b> fell m/m to its lowest level since
August. Virtually all of the component series fell with the exceptions
of capital expenditures and technology spending. They both remained
near the highest levels since before the recession began.</p>
<p>The Empire State Manufacturing Survey is a monthly survey of
manufacturers in New York State. Participants from across the state in
a variety of industries respond to a questionnaire and report the
change in indicators from the previous month. Each index is seasonally
adjusted. Respondents also state the likely direction of these same
indicators six months ahead.<span> For more on the Empire State
Manufacturing Survey, including methodologies and the latest report,
click <a href="http://www.newyorkfed.org/survey/empire/empiresurvey_overview.html">here</a>.</span>
<span>The Empire State data is available in Haver's <b>SURVEYS
</b>database.</span></p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517b.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517c.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b><a href="http://www.haverselect.com/dlx/SURVEYS/@S5/@S511/@S511.HTM">Empire
State
Manufacturing Survey</a></b></th>
<th scope="col"><b>May</b></th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>May '09&nbsp;</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">General Business Conditions
(diffusion index, %)&nbsp;&nbsp;</td>
<td>19.11</td>
<td>31.86</td>
<td>22.86</td>
<td>-5.64</td>
<td>-2.76</td>
<td>-9.97</td>
<td>17.22</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; New Orders</td>
<td>14.30</td>
<td>29.49</td>
<td>25.43</td>
<td>-8.63</td>
<td>-2.52</td>
<td>-6.22</td>
<td>15.70</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Inventories</td>
<td>1.32</td>
<td>11.39</td>
<td>4.94</td>
<td>-35.96</td>
<td>-21.59</td>
<td>-7.87</td>
<td>-3.95</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Employment</td>
<td>22.37</td>
<td>20.25</td>
<td>12.35</td>
<td>-23.86</td>
<td>-17.28</td>
<td>-5.36</td>
<td>11.28</td>
</tr>
<tr class="odd">
<td class="firstcol">Prices Paid</td>
<td>44.74</td>
<td>41.77</td>
<td>29.63</td>
<td>-11.36</td>
<td>1.33</td>
<td>46.99</td>
<td>35.64</td>
</tr>
</tbody>
</table>
</body></html>

Recent improvement in business conditions in the Northeast region of the country lost momentum this month. The Federal Reserve Bank of New York reported that its May Empire State Factory Index of General Business Conditions fell to [...]

Empire State Business Conditions Deteriorate Except Jobs & Pricing

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
<style>
.odd{
background-color:#edf5ff;
}
.even{
background-color:#dde5ef;
}
.grey1{
background-color:#f0f0f0;
}
.grey2{
background-color:#e2e2e2;
}
.grey3{
background-color:#d4d4d4;
}
.grey4{
background-color:#c6c6c6;
}
.grey5{
background-color:#b8b8b8;
}
</style>
</head>
<body>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517a.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>Recent improvement in business conditions in the Northeast
region of the country lost momentum this month. The Federal Reserve
Bank of New York reported that its May <b>Empire State Factory
Index of General Business Conditions</b> fell to 19.11, its
lowest level this year. Nevertheless, the May level suggests positive
growth in factory sector activity but it fell short of Consensus
expectations for a reading of 30.0.</p>
<p>The figure is a diffusion index. Since the series' inception
in 2001, there has been a 75% correlation between its level and the
three-month change in U.S. factory sector production. Like the
Philadelphia Fed Index of General Business Conditions, the Empire State
Business Conditions Index reflects answers to independent survey
questions; it is not a weighted combination of the components. The
series dates back only to 2001.</p>
<p>Deterioration amongst the separate survey questions was
widespread this month including new orders, shipments and inventories.
The employment index, however, improved to 22.37 which was the series'
highest level. Since inception there has been an 87% correlation
between the employment index and the three-month growth in factory
sector employment as reported by the Labor Department.</p>
<p>Continuing it earlier upward momentum, the prices paid index
rose to 44.74, its highest since September 2008. Since inception there
has been a 76% correlation between the index of prices paid and the
three-month change in the core intermediate materials PPI.</p>
<p>The Empire State <b>index of expected business
conditions in six months</b> fell m/m to its lowest level since
August. Virtually all of the component series fell with the exceptions
of capital expenditures and technology spending. They both remained
near the highest levels since before the recession began.</p>
<p>The Empire State Manufacturing Survey is a monthly survey of
manufacturers in New York State. Participants from across the state in
a variety of industries respond to a questionnaire and report the
change in indicators from the previous month. Each index is seasonally
adjusted. Respondents also state the likely direction of these same
indicators six months ahead.<span> For more on the Empire State
Manufacturing Survey, including methodologies and the latest report,
click <a href="http://www.newyorkfed.org/survey/empire/empiresurvey_overview.html">here</a>.</span>
<span>The Empire State data is available in Haver's <b>SURVEYS
</b>database.</span></p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517b.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517c.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b><a href="http://www.haverselect.com/dlx/SURVEYS/@S5/@S511/@S511.HTM">Empire
State
Manufacturing Survey</a></b></th>
<th scope="col"><b>May</b></th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>May '09&nbsp;</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">General Business Conditions
(diffusion index, %)&nbsp;&nbsp;</td>
<td>19.11</td>
<td>31.86</td>
<td>22.86</td>
<td>-5.64</td>
<td>-2.76</td>
<td>-9.97</td>
<td>17.22</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; New Orders</td>
<td>14.30</td>
<td>29.49</td>
<td>25.43</td>
<td>-8.63</td>
<td>-2.52</td>
<td>-6.22</td>
<td>15.70</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Inventories</td>
<td>1.32</td>
<td>11.39</td>
<td>4.94</td>
<td>-35.96</td>
<td>-21.59</td>
<td>-7.87</td>
<td>-3.95</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Employment</td>
<td>22.37</td>
<td>20.25</td>
<td>12.35</td>
<td>-23.86</td>
<td>-17.28</td>
<td>-5.36</td>
<td>11.28</td>
</tr>
<tr class="odd">
<td class="firstcol">Prices Paid</td>
<td>44.74</td>
<td>41.77</td>
<td>29.63</td>
<td>-11.36</td>
<td>1.33</td>
<td>46.99</td>
<td>35.64</td>
</tr>
</tbody>
</table>
<span id="articletitle">UK CBI Trends Are Up</span><br>
<span id="byline">by <a href="/comment/Brusca.html">Robert
Brusca</a> May 17, 2010</span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517d.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>The UK CBI index improved sharply and much more sharply than
expected in May. The orders index jumped from a -36 reading to -18,
remaining negative but halving its negative reading. The result was
completely unexpected. Export orders have improved to the point where
their reading is positive for the first time since early 2008. The
overall all orders index has just made the largest jump month to month
since at least 1989.</p>
<p>The 3-month-ahead volume outlook index improved this month to
a net balance reading of +17 from +14 in April. April has seen a big
boost to +14 from +5 in March. The outlook volume index stands in the
77th percentile of its range which is a pretty strong standing. The
export reading has tied its high since 1996 and has seen no higher
reading since August of 1995.</p>
<p>This sort of industrial turnaround could put the BOE on the
defensive. UK inflation data have not been good. But if the economy
shows signs of strength the inflation data could come to have a more
pejorative interpretation.</p>
<p>For now the rise in the industrial in orders index is sharp
but only brings it to a reading of -18. Still that is a 58th percentile
reading and, by itself, that is not as weak-sounding to me as a minus
eighteen scoring sounds. So the BOE has balance for now. The industrial
sector seems to be making a push but it is still showing a lot of
weakness. Still, the main point stands. The stronger that the
industrial sector and the rest of the economy gets, the more that any
inflation overshoot will begin to worry the BOE.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="11" scope="col"><b>UK
Industrial volume data CBI Survey</b> </th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Reported:</td>
<td>May<br>
10</td>
<td>Apr<br>
10</td>
<td>Mar<br>
10</td>
<td>Feb<br>
10</td>
<td>Jan<br>
10</td>
<td>12MO Avg</td>
<td>Pcntle</td>
<td>Max</td>
<td>Min</td>
<td>Range</td>
</tr>
<tr>
<td class="firstcol">Total Orders</td>
<td>-18</td>
<td>-36</td>
<td>-37</td>
<td>-36</td>
<td>-39</td>
<td>-47</td>
<td>58%</td>
<td>13</td>
<td>-61</td>
<td>74</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Export
Orders</td>
<td>3</td>
<td>-16</td>
<td>-18</td>
<td>-23</td>
<td>-33</td>
<td>-40</td>
<td>77%</td>
<td>20</td>
<td>-55</td>
<td>75</td>
</tr>
<tr>
<td class="firstcol">Stocks:FinGds</td>
<td>10</td>
<td>10</td>
<td>5</td>
<td>12</td>
<td>13</td>
<td>16</td>
<td>36%</td>
<td>31</td>
<td>-2</td>
<td>33</td>
</tr>
<tr style="font-weight: bold;" class="odd">
<td colspan="11" class="firstcol">Looking
ahead</td>
</tr>
<tr>
<td class="firstcol">Output Volume:Nxt
3M</td>
<td>17</td>
<td>14</td>
<td>5</td>
<td>7</td>
<td>4</td>
<td>-3</td>
<td>77%</td>
<td>36</td>
<td>-48</td>
<td>84</td>
</tr>
<tr>
<td class="firstcol">Avg Prices 4Nxt 3m
</td>
<td>16</td>
<td>17</td>
<td>8</td>
<td>8</td>
<td>-6</td>
<td>-3</td>
<td>69%</td>
<td>37</td>
<td>-30</td>
<td>67</td>
</tr>
<tr class="odd">
<td colspan="11" class="firstcol">From early
1989 </td>
</tr>
</tbody>
</table>
<span id="articletitle">Japanese Corporate Prices And
Machinery Orders</span><br>
<span id="byline">by <a href="/comment/Curley.html">Louise
Curley</a> May 17, 2010</span>
<span id="articletext">
<p></p>
<p>Japan's Domestic Corporate Goods Price index has been inching
up in each month since November of last year. By April the index,
published today, was 0.9% above November. On a year over year basis,
the index in April was only 0.2% below April, 2009.</p>
<p>The Domestic Corporate Goods Price Index is analogous to a
Wholesale or Producer Price Index. In fact, until 2002, the index was
called the Wholesale Price Index. At that time, substantial revisions
were made in the index, the base was changed from 1995 to 2000 and the
name was changed. The base of the index is now 2005.</p>
<p>The rise in prices at the wholesale level, though small, gives
some reason to hope that the deflation in consumer prices will also be
lessening. There is a good correlation between the Domestic Corporate
Goods Price Index and the Consumer Price Index as shown in the first
Chart which compares the year to year changes in the two series. The
year to year change in the Consumer Price Index was -1.09% in March,
the latest month available. This compares with a -2.53% year to year
decline in October, 2009.</p>
<p>Data for machinery orders were also released today. Total
orders were up 3.6% in March from February, and those for the headline
series, Private machinery orders excluding volatile orders (ships and
electric power) were up 5.4%. Even excluding the volatile factors,
monthly orders are still erratic. As a result we have aggregated the
total and the headline series to quarterly totals which are shown in
the second chart. Increased activity in new orders bodes well for
future sales and may have a small but positive effect on total GDP for
the first quarter, which is to be published this Thursday.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517e.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517f.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol">Year
to Year Changes (%)</th>
<th scope="col"><b>Apr 10</b></th>
<th scope="col"><b>Mar 10&nbsp;</b></th>
<th scope="col"><b>Feb 10&nbsp;</b></th>
<th scope="col"><b>Jan 10</b></th>
<th scope="col"><b>Dec 09</b></th>
<th scope="col"><b>Nov 09</b></th>
<th scope="col"><b>Oct 09</b></th>
<th scope="col"><b>Sep&nbsp; 09</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Domestic Corporate
Goods Price Index</td>
<td>-0.19</td>
<td>-1.25</td>
<td>-1.63</td>
<td>-2.20</td>
<td>-3.77</td>
<td>-5.02</td>
<td>-6.76</td>
<td>-7.88</td>
</tr>
<tr>
<td class="firstcol">Consumer Price
Index</td>
<td>--&nbsp;</td>
<td>-1.09</td>
<td>-1.10</td>
<td>-1.29</td>
<td>-1.68</td>
<td>-1.87</td>
<td>-2.53</td>
<td>-2.24</td>
</tr>
<tr class="grey3">
<td style="font-weight: bold;" class="firstcol">Quarter
to Quarter
Changes (%)</td>
<td><b>Q1 10</b></td>
<td><b>Q4 09&nbsp;</b></td>
<td><b>Q3 09&nbsp;</b></td>
<td><b>Q2 09</b></td>
<td><b>Q1 09</b></td>
<td><b>Q4 08</b></td>
<td><b>Q3 08</b></td>
<td><b>Q2 08</b></td>
</tr>
<tr class="odd">
<td class="firstcol">Total Machinery
Orders</td>
<td>9.02</td>
<td>8.03</td>
<td>8.99</td>
<td>-7.32</td>
<td>-14.47</td>
<td>-19.91</td>
<td>-10.12</td>
<td>-5.90</td>
</tr>
<tr>
<td class="firstcol">Private ex
Volatile Orders (Head line)</td>
<td>2.92</td>
<td>1.13</td>
<td>-0.70</td>
<td>-5.64</td>
<td>-9.64</td>
<td>-14.69</td>
<td>-8.72</td>
<td>-2.05</td>
</tr>
</tbody>
</table>
<span id="articletitle">U.S. Home Builders&#8217; Index Rises To
Highest Since 2007</span><br>
<span id="byline">by <a href="/comment/Moeller.html">Tom
Moeller</a> May 17,2010</span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517g.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517h.jpg" style="width: 312px; height: 265px;"></p>
<p>The housing market is rebounding according to the National
Association of Home Builders. Their index of housing market activity
rose this month to 22 from 19 in April and the latest matched the
highest level since July 2007, before the recession's onset. Moreover,
the index nearly tripled the low of 8 hit in January 2009. A rise in
May to 20 was the Consensus expectation.</p>
<p>The Home builders index is compiled from survey questions
asking builders to rate market conditions as &#8220;good&#8221;, &#8220;fair&#8221;, &#8220;poor&#8221; or
&#8220;very high&#8221; to &#8220;very low&#8221;.<span> </span>The figure is thus
a diffusion index with numerical results over 50 indicating a
predominance of &#8220;good&#8221; readings. During the last ten years there has
been a 75% correlation between the y/y change in the index and new plus
existing single family home sales.</p>
<p>At 23, the present sales index also rose to its highest level
since July 2007. The index of sales during the next six months
improved, but to a lesser extent, to a reading of 28 which was the
highest level since November.The Home Builders' Association also
reported that the traffic of prospective buyers recovered but only to
the highest level since September. Each of these NAHB figures is
seasonally adjusted.</p>
<p>Improvement was sharpest in the Builders' index for the
Northeast where the index rose to its highest level since 2007.
Elsewhere, improvement was less pronounced.</p>
<p>The Home Builders' Housing Opportunity Index, which is the
share of homes sold that could be considered affordable to a family
earning the median income, slipped during 4Q '09 (the latest available
figure) to 70.8%. It had jumped earlier to a record high of 72.5%
buoyed by lower home prices, lower interest rates and higher income.
(There is a break in the series from 2002 to 2003.)</p>
<p>The NAHB has compiled the <b>Housing Market Index</b>
since 1985.<span> </span>The weights assigned to the
individual index components are .5920 for single family detached sales,
present; time, .1358 for single family detached sales, next six months;
and .2722 for traffic of prospective buyers. The results, along with
other housing and remodeling indexes from NAHB Economics, are included
in Haver&#8217;s <b>SURVEYS</b> database.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517i.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100517j.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b><a ;="" href="http://www.haverselect.com/dlx/SURVEYS/@S4/@S4.HTM" style="color: black;">Nat'l Association of Home Builders</a></b></th>
<th scope="col"><b>May</b></th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>&nbsp;May '09</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Composite Housing Market Index
(All Good=100)</td>
<td>22</td>
<td>19</td>
<td>15</td>
<td>16</td>
<td>15</td>
<td>16</td>
<td>27</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Single-Family Sales</td>
<td>23</td>
<td>20</td>
<td>15</td>
<td>14</td>
<td>13</td>
<td>16</td>
<td>27</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Single-Family Sales:
Next Six Months</td>
<td>28</td>
<td>25</td>
<td>24</td>
<td>27</td>
<td>24</td>
<td>25</td>
<td>37</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Traffic of
Prospective Buyers</td>
<td>16</td>
<td>13</td>
<td>10</td>
<td>13</td>
<td>13</td>
<td>14</td>
<td>21</td>
</tr>
</tbody>
</table>
</body></html>

Empire State Business ConditionsDeteriorate Except Jobs & Pricing

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
<style>
.odd{
background-color:#edf5ff;
}
.even{
background-color:#dde5ef;
}
.grey1{
background-color:#f0f0f0;
}
.grey2{
background-color:#e2e2e2;
}
.grey3{
background-color:#d4d4d4;
}
.grey4{
background-color:#c6c6c6;
}
.grey5{
background-color:#b8b8b8;
}
</style>
</head>
<body>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514a.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>Improvement in the job market definitely has translated into
more business for U.S. retailers. Retail sales rose 0.4% last month.
The gain was twice the Consensus expectation and the March increase was
revised up to 2.1% from 1.6% initially reported.Year-to-year, the 8.8%
increase in sales was the strongest since 2005 although sales remained
3.6% below the pre-recession peak.</p>
<p>Nonauto sales also posted an expected 0.4% increase in April
following two months of 1.2% gains. The March rise was double the
advance indication. Bloating this increase was a 6.9% surge (12.1% y/y)
in sales of building materials &amp; garden equipment.</p>
<p>To the downside in April was "core" discretionary spending,
though earlier gains are still improved. Apparel store sales fell 1.0%
(+5.7% y/y), although they rose at a 15.3% rate during the last three
months. Sales at furniture, home furnishings &amp; electronics
stores also fell by 0.8%, but the three-month change actually rose by
9.3% after two years of decline. Furniture sales alone declined 1.2%
following two months of 2.0%+ increases. Sales of electronics &amp;
appliances fell for the second consecutive month. However, as a result
of a strong beginning to the year, three-month sales increased at a
5.5% annual rate. Finally, sales at general merchandise stores slipped
0.4% (+3.9% y/y) but they rose at a 5.7% rate during the last three
months.</p>
<p>Despite the decline in unit sales, motor vehicle sales rose
0.5% last month and at a 19.5% rate during the last three. Finally,
sales at gasoline service stations rose just 0.5% (30.1% y/y) despite a
2.8% rise (39.0% y/y) in April gas prices. Are higher prices
discouraging usage?</p>
<p>Earlier strength in internet &amp; catalogue sales
continued to abate. Sales ticked up just 0.2% and the three-month
annualized rate of gain backed off further to 3.0% down from 25.3%
growth in January.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514b.jpg" style="border: 0px solid ; width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514c.jpg" style="border: 0px solid ; width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol">&nbsp;</th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>April y/y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol"><a ;="" href="http://www.haverselect.com/dlx/usecon/@ED/@ED04/@ED0401/@ED0401.HTM">Total Retail Sales &amp; Food
Services</a> (%)</td>
<td>0.4</td>
<td>2.1</td>
<td>0.6</td>
<td>8.8</td>
<td>-6.0</td>
<td>-0.8</td>
<td>3.3</td>
</tr>
<tr>
<td class="firstcol">Excluding
Autos</td>
<td>0.4</td>
<td>1.2</td>
<td>1.2</td>
<td>7.6</td>
<td>-4.8</td>
<td>2.4</td>
<td>3.9</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;&nbsp;
Non-Auto Less Gasoline</td>
<td>0.4</td>
<td>1.3</td>
<td>1.3</td>
<td>5.1</td>
<td>-1.9</td>
<td>1.6</td>
<td>3.6</td>
</tr>
</tbody>
</table>
</body></html>

Improvement in the job market definitely has translated into more business for U.S. retailers. Retail sales rose 0.4% last month. The gain was twice the Consensus expectation and the March increase was revised up to 2.1% from 1.6% [...]

U.S. Retail Spending Remains Firm; Core Sales Are Strongest Since 2006

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
<style>
.odd{
background-color:#edf5ff;
}
.even{
background-color:#dde5ef;
}
.grey1{
background-color:#f0f0f0;
}
.grey2{
background-color:#e2e2e2;
}
.grey3{
background-color:#d4d4d4;
}
.grey4{
background-color:#c6c6c6;
}
.grey5{
background-color:#b8b8b8;
}
</style>
</head>
<body>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514a.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>Improvement in the job market definitely has translated into
more business for U.S. retailers. Retail sales rose 0.4% last month.
The gain was twice the Consensus expectation and the March increase was
revised up to 2.1% from 1.6% initially reported.Year-to-year, the 8.8%
increase in sales was the strongest since 2005 although sales remained
3.6% below the pre-recession peak.</p>
<p>Nonauto sales also posted an expected 0.4% increase in April
following two months of 1.2% gains. The March rise was double the
advance indication. Bloating this increase was a 6.9% surge (12.1% y/y)
in sales of building materials &amp; garden equipment.</p>
<p>To the downside in April was "core" discretionary spending,
though earlier gains are still improved. Apparel store sales fell 1.0%
(+5.7% y/y), although they rose at a 15.3% rate during the last three
months. Sales at furniture, home furnishings &amp; electronics
stores also fell by 0.8%, but the three-month change actually rose by
9.3% after two years of decline. Furniture sales alone declined 1.2%
following two months of 2.0%+ increases. Sales of electronics &amp;
appliances fell for the second consecutive month. However, as a result
of a strong beginning to the year, three-month sales increased at a
5.5% annual rate. Finally, sales at general merchandise stores slipped
0.4% (+3.9% y/y) but they rose at a 5.7% rate during the last three
months.</p>
<p>Despite the decline in unit sales, motor vehicle sales rose
0.5% last month and at a 19.5% rate during the last three. Finally,
sales at gasoline service stations rose just 0.5% (30.1% y/y) despite a
2.8% rise (39.0% y/y) in April gas prices. Are higher prices
discouraging usage?</p>
<p>Earlier strength in internet &amp; catalogue sales
continued to abate. Sales ticked up just 0.2% and the three-month
annualized rate of gain backed off further to 3.0% down from 25.3%
growth in January.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514b.jpg" style="border: 0px solid ; width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514c.jpg" style="border: 0px solid ; width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol">&nbsp;</th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>April y/y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol"><a ;="" href="http://www.haverselect.com/dlx/usecon/@ED/@ED04/@ED0401/@ED0401.HTM">Total
Retail Sales &amp; Food
Services</a> (%)</td>
<td>0.4</td>
<td>2.1</td>
<td>0.6</td>
<td>8.8</td>
<td>-6.0</td>
<td>-0.8</td>
<td>3.3</td>
</tr>
<tr>
<td class="firstcol">Excluding
Autos</td>
<td>0.4</td>
<td>1.2</td>
<td>1.2</td>
<td>7.6</td>
<td>-4.8</td>
<td>2.4</td>
<td>3.9</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;&nbsp;
Non-Auto Less Gasoline</td>
<td>0.4</td>
<td>1.3</td>
<td>1.3</td>
<td>5.1</td>
<td>-1.9</td>
<td>1.6</td>
<td>3.6</td>
</tr>
</tbody>
</table>
<span id="articletitle">Industrial Production Continues To
Rise</span><br>
<span id="byline">by <a href="/comment/Moeller.html">Tom
Moeller</a> May 14,2010</span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514d.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>The industrial sector continued its improvement last month.
Overall production rose 0.8% after a 0.3% March increase. It's up at a
6.4% annual rate so far this year. Though these gains are improved,
they understate the degree of improvement following last year's
recession. In the factory sector alone output rose 1.0% during the last
two months and it has risen at a 9.1% rate so far this year.</p>
<p>Though gains in output this year have been broad-based, the
rise in output of construction supplies and business equipment have
been notable. Output of construction supplies has risen at a 20.1% (AR)
in 2010 after last year's 17.8% decline. Nevertheless, output remained
off 24% from the 2006 peak. Business equipment likewise has been strong
with a 12.7% gain so far this year after the 12.4% 2009 drop. Output
remained off 12% from the 2008 peak.</p>
<p>Elsewhere, output of consumer goods has posted a lesser gain
of 1.8% so far this year held back by 4.1% rise in output of auto
products and a 1.1% gain in output of computers, video and equipment.
Output of appliances and furniture rose at a stronger 19.6% rate but
here again the production level remains depressed and off one-third
from the 2006 peak. Apparel output also posted a strong 20.2% gain this
year after a 12.4% decline during 2009. Nevertheless, it's off
two-thirds from 1994 as production has moved out of the States.</p>
<p>Capacity utilization rose further to 73.7%, its highest level
since November 2008. In the factory sector alone utilization rose to
70.8% from the 2009 low of 65.1%.</p>
<p>The industrial production data are available in Haver's <b>USECON</b>
database.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514e.jpg" style="border: 0px solid ; width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514f.jpg" style="border: 0px solid ; width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b>Industrial
Production (SA,%)</b></th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>y/y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol"><b>Total Output</b></td>
<td>0.8</td>
<td>0.3</td>
<td>-0.2</td>
<td>5.2</td>
<td>-9.7</td>
<td>-2.2</td>
<td>1.5</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;Manufacturing</td>
<td>1.0</td>
<td>1.0</td>
<td>0.0</td>
<td>6.0</td>
<td>-11.3</td>
<td>-3.2</td>
<td>1.4</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;&nbsp;Consumer
Goods</td>
<td>0.2</td>
<td>0.1</td>
<td>-1.3</td>
<td>3.8</td>
<td>-5.2</td>
<td>-2.6</td>
<td>0.9</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;&nbsp;Business
Equipment</td>
<td>1.1</td>
<td>1.2</td>
<td>0.3</td>
<td>6.1</td>
<td>-12.4</td>
<td>-1.1</td>
<td>2.7</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;&nbsp;Construction
Supplies</td>
<td>2.7</td>
<td>2.8</td>
<td>-0.6</td>
<td>2.8</td>
<td>-17.8</td>
<td>-6.3</td>
<td>-2.0</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;&nbsp;Materials</td>
<td>1.0</td>
<td>0.0</td>
<td>0.7</td>
<td>7.0</td>
<td>-10.9</td>
<td>-1.9</td>
<td>2.0</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Utilities</td>
<td>-1.3</td>
<td>-6.0</td>
<td>-1.7</td>
<td>-2.5</td>
<td>-2.5</td>
<td>0.3</td>
<td>3.4</td>
</tr>
<tr class="odd">
<td class="firstcol"><b>Capacity Utilization
(%)</b></td>
<td>73.7</td>
<td>73.1</td>
<td>73.8</td>
<td>69.2 (April '09)</td>
<td>70.1</td>
<td>77.5</td>
<td>80.6</td>
</tr>
<tr class="odd">
<td class="firstcol"><b>&nbsp;&nbsp; </b>Factory
Utilization</td>
<td>70.8</td>
<td>70.0</td>
<td>69.2</td>
<td>65.8</td>
<td>66.8</td>
<td>75.1</td>
<td>79.0</td>
</tr>
</tbody>
</table>
<span id="articletitle">Michigan Consumer Sentiment
Improves Slightly</span><br>
<span id="byline">by <a href="/comment/Moeller.html">Tom
Moeller</a> May 14,2010</span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514g.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>The University of Michigan reported that its mid-May reading
of consumer sentiment rose slightly to 73.3 from 72.2 during all of
April. The figure roughly reversed the modest April decline and was as
expected. Despite this unimpressive performance, the reading was up by
one-third from its 2008 low.</p>
<p>The index of expected economic conditions improved m/m to
68.3. Here again, the figure has moved sideways of late but is 38.8%
above the 2008 low. The readings for expected change in personal
finances (-4.4% y/y), business conditions during the next twelve months
(12.0% y/y) and expected five-year business conditions (-9.1% y/y) each
recently have been flat-to-lower.</p>
<p>Sentiment about current economic conditions moved sideways. It
remained up 19.8% from last year and up 41.1% from the 2008 low. The
assessment of current personal finances nudged higher m/m (31.1% y/y)
but buying conditions for large household goods, including furniture,
refrigerators, stoves &amp; televisions fell (+14.2% y/y).</p>
<p>Expected price inflation during the next year increased to
4.0% and was up from the December 2008 reading of 1.7%.Respondents'
view of government policy, which may eventually influence economic
expectations, was stable m/m but down roughly one-third from its high
last May. Twelve percent of respondents thought that a good job was
being done by government versus 38% who thought a poor job was being
done, near the twelve-month high.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514h.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100514i.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><a ;="" href="http://www.haverselect.com/dlx/USECON/@EF/@EF14/@EF1402/@EF1402.HTM"><b>University
of Michigan</b></a></th>
<th scope="col"><b>Mid-May</b></th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>May y/y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Consumer Sentiment</td>
<td>73.3</td>
<td>72.2</td>
<td>73.6</td>
<td><span>6.7%</span></td>
<td>66.3</td>
<td>63.8</td>
<td>85.6</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Current Conditions</td>
<td>81.1</td>
<td>81.0</td>
<td>82.4</td>
<td>19.8</td>
<td>69.6</td>
<td>73.7</td>
<td>101.2</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Expectations</td>
<td>68.3</td>
<td>66.5</td>
<td>67.9</td>
<td>-1.6</td>
<td>64.1</td>
<td>57.3</td>
<td>75.6</td>
</tr>
</tbody>
</table>
</body></html>

U.S. Retail Spending Remains Firm;Core Sales Are Strongest Since 2006

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
<style>
.odd{
background-color:#edf5ff;
}
.even{
background-color:#dde5ef;
}
.grey1{
background-color:#f0f0f0;
}
.grey2{
background-color:#e2e2e2;
}
.grey3{
background-color:#d4d4d4;
}
.grey4{
background-color:#c6c6c6;
}
.grey5{
background-color:#b8b8b8;
}
</style>
</head>
<body>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100513j.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>The UK trade picture deteriorated in March With exports up by
1% on the month as imports screamed higher by 5.2%. This put exports in
a severe shortfall position for March and ballooned the deficit. Of
course in March the situation had been completely reversed and the
deficit was much smaller. Over the various intervals in the table,
3-mo, 6-mo and 12-mo, export and import growth rate pairs are very
similar in each period (with both growth rates steadily rising). But
imports are stronger over three months compared to exports which, in
turn, are stronger over six- and twelve-months. But since the UK trade
balance is in deficit to start, those periods in which exports did grow
faster did not did not do much good, as the deficit widened in each of
them (three months compared to six months and six months compared to
twelve-months).</p>
<p>The trade balance is a tough to talk about in the
recession-to-recovery periods since its impact on the economy and its
meaning are conflicted. Obviously a wider trade deficit weakens GDP as
the trade balance is a subtraction from GDP. But paradoxically strong
imports which contribute to a widening of the deficit (all other things
equal) are a sign of revived domestic demand and of STRONGER GDP growth.</p>
<p>So the signal from trade about the UK economy is somewhat
muddled. In the chart above the trend for the deficit shows that amid
some volatility the deficit is getting larger indicating that imports
are outpacing exports or at least more of less tracking with them. More
importantly, the growth rate for imports is steadily rising (as is the
trend for exports). That suggests a revival in demand in the UK
economy. So while the trade gap is widening and that is siphoning off
some of the impact of this rising domestic demand, reducing its spur to
domestic growth, the evidence from trade is that the UK economy is
still in the improving mode as domestic demand is underpinning imports
and rising strongly.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="6" scope="col"> <b>UK Trade
trends for goods</b>
</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td style="font-weight: bold;" class="firstcol">&nbsp;</td>
<td style="font-weight: bold;" colspan="2">m/m%</td>
<td style="font-weight: bold;" colspan="3">%
Saar</td>
</tr>
<tr class="grey1">
<td class="firstcol">&nbsp;</td>
<td>Mar-10</td>
<td>Feb-10</td>
<td>3M</td>
<td>6M</td>
<td>12M</td>
</tr>
<tr class="grey1">
<td class="firstcol">Balance*</td>
<td>-&#163; 52 </td>
<td>-&#163; 6.31 </td>
<td>-&#163; 7.26 </td>
<td>-&#163; 7.14 </td>
<td>-&#163; 6.87 </td>
</tr>
<tr class="odd">
<td colspan="6" class="firstcol"><b>Exports</b></td>
</tr>
<tr>
<td class="firstcol">All Exp</td>
<td>1.0%</td>
<td>8.0%</td>
<td>10.9%</td>
<td>23.6%</td>
<td>15.7%</td>
</tr>
<tr>
<td class="firstcol">Capital gds</td>
<td>0.8%</td>
<td>1.3%</td>
<td>2.4%</td>
<td>13.1%</td>
<td>-0.4%</td>
</tr>
<tr>
<td class="firstcol">Road Vehicles</td>
<td>-2.1%</td>
<td>4.0%</td>
<td>-29.4%</td>
<td>28.6%</td>
<td>45.1%</td>
</tr>
<tr>
<td class="firstcol">Basic Materials</td>
<td>13.1%</td>
<td>46.9%</td>
<td>174.7%</td>
<td>84.6%</td>
<td>57.9%</td>
</tr>
<tr>
<td class="firstcol">Food Feed Bev
&amp; Tbco</td>
<td>0.6%</td>
<td>8.0%</td>
<td>-0.6%</td>
<td>15.6%</td>
<td>10.7%</td>
</tr>
<tr>
<td class="firstcol">Other Exports</td>
<td>0.9%</td>
<td>8.6%</td>
<td>15.6%</td>
<td>23.7%</td>
<td>15.2%</td>
</tr>
<tr class="odd">
<td colspan="6" class="firstcol"><span style="font-weight: bold;">IMPORTS</span></td>
</tr>
<tr>
<td class="firstcol">All IMP</td>
<td>5.2%</td>
<td>-0.3%</td>
<td>16.1%</td>
<td>21.4%</td>
<td>14.0%</td>
</tr>
<tr>
<td class="firstcol">Capital gds</td>
<td>2.4%</td>
<td>-0.4%</td>
<td>0.0%</td>
<td>23.1%</td>
<td>9.0%</td>
</tr>
<tr>
<td class="firstcol">Road Vehicles</td>
<td>8.2%</td>
<td>-1.0%</td>
<td>5.6%</td>
<td>30.7%</td>
<td>60.9%</td>
</tr>
<tr>
<td class="firstcol">Basic Materials</td>
<td>10.8%</td>
<td>-3.2%</td>
<td>73.6%</td>
<td>22.8%</td>
<td>24.6%</td>
</tr>
<tr>
<td class="firstcol">Food Feed Bev
&amp; Tbco</td>
<td>1.8%</td>
<td>1.9%</td>
<td>-5.0%</td>
<td>8.6%</td>
<td>1.7%</td>
</tr>
<tr>
<td class="firstcol">Other Imports</td>
<td>5.5%</td>
<td>-0.3%</td>
<td>22.8%</td>
<td>21.7%</td>
<td>11.5%</td>
</tr>
<tr class="odd">
<td colspan="6" class="firstcol">*Stg Blns;
mo or period
average</td>
</tr>
</tbody>
</table>
</body></html>

The UK trade picture deteriorated in March With exports up by 1% on the month as imports screamed higher by 5.2%. This put exports in a severe shortfall position for March and ballooned the deficit. Of course in March the situation [...]

UK Trade Deficit Worsens As Exports Lag Imports

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
<style>
.odd{
background-color:#edf5ff;
}
.even{
background-color:#dde5ef;
}
.grey1{
background-color:#f0f0f0;
}
.grey2{
background-color:#e2e2e2;
}
.grey3{
background-color:#d4d4d4;
}
.grey4{
background-color:#c6c6c6;
}
.grey5{
background-color:#b8b8b8;
}
</style>
</head>
<body>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100513g.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>The Federal government's April budget balance totaled $-82.7B
which was four times the April '09 deficit. Nevertheless, the Fiscal
'YTD deficit narrowed to $799.7B and was somewhat smaller than the
FY'09 deficit of $802.3B.</p>
<p>Though the recession ended, net revenues during the first
seven months of FY'10 still fell 4.5% y/y. Individual income tax
receipts fell 11.6% y/y as the unemployment rate remained elevated. The
rate of decline, however, is down from the peak 29.0% at the end of
last year. Corporate tax receipts firmed by 8.9% versus the first seven
months of last fiscal year with improved corporate profits.
Year-to-date, employment taxes fell 4.8% (just lightly off the peak
rate of decline) but unemployment insurance tax receipts improved by
12.3% versus the first seven months of last fiscal year. Estate
&amp; gift taxes fell by nearly one-quarter this fiscal year.</p>
<p>Overall outlays fell 2.9% so far this fiscal year versus FY'09
as a commerce &amp; housing credit expired. Social Security
payments (21% of outlays) rose 6.7% and net interest payments (5% of
outlays) rose 7.9% with higher rates. Medicare expenditures (12% of
outlays) rose 11.0% and other health care services spending (10% of
outlays) rose 12.4%. "Income security" spending (11% of outlays)
continued to jump by one-quarter while defense spending (19% of total
outlays) rose 7.8%.</p>
<p>The Government's financial data are available in Haver's <b>USECON</b>
database, with extensive detail available in the specialized <b>GOVFIN</b>.</p>
<p><span class="detailTitle" style="width: 400px;"><b>True
Legislators Becoming Scarce in Congress</b> from the American
Enterprise Institute can be found <a href="http://www.aei.org/article/102038">here</a>.</span></p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100513h.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100513i.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/USECON/@E1/@E106/@E10602/@E106021.HTM"><b>US
Government Finance</b></a> &nbsp;</th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>FY 'YTD</b></th>
<th scope="col"><b>FY 'YTD</b></th>
<th scope="col"><b>FY 2009</b></th>
<th scope="col"><b>FY 2008</b></th>
<th scope="col"><b>FY 2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Budget Balance</td>
<td>$-82.7B</td>
<td>$-799.7B</td>
<td>&nbsp;--</td>
<td>$-1,417.1B</td>
<td>$-454.8B</td>
<td>$-161.5B</td>
</tr>
<tr>
<td class="firstcol">Net Revenues</td>
<td>$245.3B</td>
<td>$1,199.2B</td>
<td>-4.5%</td>
<td>-16.6%</td>
<td>-1.7%</td>
<td>6.7%</td>
</tr>
<tr class="odd">
<td class="firstcol">Net Outlays</td>
<td>$328.0B</td>
<td>$1,998.8B</td>
<td>-2.9%</td>
<td>18.2%</td>
<td>9.1%</td>
<td>2.8%</td>
</tr>
</tbody>
</table>
</body></html>

The Federal government's April budget balance totaled $-82.7B which was four times the April '09 deficit. Nevertheless, the Fiscal 'YTD deficit narrowed to $799.7B and was somewhat smaller than the FY'09 deficit of $802.3B. Though the [...]

U.S. Fiscal 'YTD Budget Deficit Narrows

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
<style>
.odd{
background-color:#edf5ff;
}
.even{
background-color:#dde5ef;
}
.grey1{
background-color:#f0f0f0;
}
.grey2{
background-color:#e2e2e2;
}
.grey3{
background-color:#d4d4d4;
}
.grey4{
background-color:#c6c6c6;
}
.grey5{
background-color:#b8b8b8;
}
</style>
</head>
<body>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100513d.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>The Bureau of Labor Statistics reported that initial claims
for jobless insurance fell 4,000 to 444,000 after the prior week's
lessened 3,000 drop. As was the case last week, the latest level
remained near this cycle's lowest but disappointed Consensus
expectations for 440,000 claims. Last week's figure was down from the
recession peak of 651,000 reached in March of 2009. The four-week
moving average of initial claims increased slightly to 450,500.</p>
<p>A 12,000 increase in continuing claims for unemployment
insurance during the latest week followed a lessened 38,000 drop during
the prior week. Claims were down by one-third from the June '09 peak.
The overall decline is a function of the improved job market but also
reflects the exhaustion of 26 weeks of unemployment benefits.
Continuing claims provide an indication of workers' ability to find
employment. The four-week average of continuing claims at 4.640M
remained near the cycle low. This series dates back to 1966.</p>
<p>Extended benefits for unemployment insurance rose w/w to
218,812. However, they were down by three-quarters from a peak of
597,688 reached in November.</p>
<p>The insured unemployment rate remained at 3.6% where it has
been since mid-February. The rate reached a high of 4.9% during May.
During the last ten years, there has been a 96% correlation between the
level of the insured unemployment rate and the overall rate of
unemployment published by the Bureau of Labor Statistics.</p>
<p>The highest insured unemployment rates in the week ending
April 24 were in Alaska (6.6 percent), Puerto Rico (6.3), Oregon (5.8),
Nevada (5.1), California (4.9), Pennsylvania (4.8), Wisconsin (4.8),
Montana (4.7), North Carolina (4.6), Rhode Island (4.6), Connecticut
(4.5), and Idaho (4.5). The lowest insured unemployment rates were in
Virginia (2.1), Texas (2.2), Georgia (2.8), Wyoming (2.9), Maryland
(3.0), Florida (3.1), Ohio (3.2), New York (3.5) and Maine (3.7). These
data are not seasonally adjusted but the overall insured unemployment
rate is.</p>
<p>The unemployment insurance claims data is available in Haver's
<b>WEEKLY</b> database and the state data is in the <b>REGIONW</b>
database.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100513e.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100513f.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b><a ;="" href="http://www.haverselect.com/dlx/WEEKLY/@W5/@W507/@W507.HTM" style="color: black;">Unemployment Insurance (000s)</a></b></th>
<th scope="col"><b>05/08/10</b></th>
<th scope="col"><b>05/01/10</b></th>
<th scope="col"><b>04/24/10</b></th>
<th scope="col"><b>Y/Y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Initial Claims</td>
<td>444</td>
<td>448</td>
<td>451</td>
<td>-29.0%</td>
<td>572</td>
<td>419</td>
<td>321</td>
</tr>
<tr>
<td class="firstcol">Continuing Claims</td>
<td>--</td>
<td>4,627</td>
<td>4,615</td>
<td>-27.6%</td>
<td>5,809</td>
<td>3,340</td>
<td>2,549</td>
</tr>
<tr class="odd">
<td class="firstcol">Insured Unemployment Rate (%)</td>
<td>--</td>
<td>3.6</td>
<td>3.6</td>
<td>4.9 (5/2009)</td>
<td>4.4</td>
<td>2.5</td>
<td>1.9</td>
</tr>
</tbody>
</table>
</body></html>

The Bureau of Labor Statistics reported that initial claims for jobless insurance fell 4,000 to 444,000 after the prior week's lessened 3,000 drop. As was the case last week, the latest level remained near this cycle's lowest but [...]

U.S. Initial Jobless Insurance Claims Slip To Low-End Of Recent Range

USD/EUR exchange rate uncoupling from interest rate differential

Widespread downgrading of 2025 GDP outlook

Trade and fiscal policy uncertainty has exploded with the new administration

Much lower US electricity costs gives it a competitive advantage

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

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

US policy gyrations boosting policy uncertainty worldwide

Expected tariff hikes have boosted inflation expectations

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

US economy expected to outperform other major economies in 2025

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

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

Heavy US manufacturing states underperforming while Sun Belt states outperforming

Rising long-term yields a global phenomenon

US financial market concerns shifting from growth to inflation

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

Policy uncertainty has surged since the US national elections.

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

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

Headline US PCE inflation elevated by sticky services prices

US and global equity prices have recently diverged

US leading global upturn in economic surprises

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

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

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

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

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


Privacy Policy

Disclaimer

Contact us

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

New York

London

Singapore

Tokyo

Economy in Brief

Viewpoints

Contact Us

Our Data

Our Products

What We Do

Our Authors

About Us

Data News

Resources

Release Calendars

Training Center

Webinars

Newsletters

Download Software

For Clients

Live Updates

Andrew Cates

**China-US shipping activity** 
The economic fallout from escalating US-China trade tensions is becoming increasingly visible in the data. A clear example is the chart below, which highlights a sharp drop in vessel arrivals at the ports of Los Angeles and Long Beach, along with a notable decline in ships waiting offshore. These trends point to a tangible weakening in bilateral trade flows, as the effects of tit-for-tat tariffs imposed by both countries begin to bite. Given the outsized role the US and China play in global commerce, this slowdown is likely to reverberate through global supply chains, weighing on trade volumes, dampening demand, and curbing economic growth worldwide.

250501Z1.jpg

**GDP growth in Q1**
Data this week showed that the US economy contracted, albeit modestly, in Q1 even as the euro area recorded a modest expansion—an unusual divergence. The contraction in US GDP can be largely attributed to a sharp increase in imports, as firms rushed to front-load purchases ahead of anticipated tariff hikes. In addition, domestic demand was subdued, with weaker contributions from both consumer spending and government consumption. This decoupling between the US and euro area economies is particularly striking given the current global focus on the US dollar. While the euro area has shown unexpected signs of resilience, the US downturn raises important questions about its underlying momentum, especially as trade dynamics and policy uncertainty continue to cloud the outlook.

250501Z2.jpg

**The US dollar versus yield differentials**
Chart 3 below illustrates a sharp breakdown in the correlation between the US-Germany 10-year yield differential and the EUR/USD exchange rate. Historically, the dollar has moved closely with interest rate spreads, as yield-seeking capital flowed into US assets. But since early 2025—and more acutely following the April tariff actions—the dollar has weakened markedly even as the yield spread has narrowed only modestly. This decoupling underscores a critical shift: capital markets are reacting not just to monetary policy, but to rising trade and geopolitical uncertainty. In other words, the exchange rate is now being driven as much by risk sentiment as by interest rate arbitrage.

250501Z3.jpg

**The US economy’s structural outperformance and the dollar**
A second dynamic, captured in the next chart, reveals a tight correlation between the US real effective exchange rate and the potential GDP growth differential between the US and euro area over the past 50-60 years. This raises the question: has dollar strength (until recently) merely been a reflection of US growth leadership—or are capital inflows themselves helping to sustain this growth outperformance? In effect, the tail may be wagging the dog. Global investors have long allocated capital to the US, attracted by its macroeconomic resilience, technological leadership, and deep, liquid financial markets. The danger now is that the US trade war may disrupt this equilibrium. A sharp or sustained reduction in capital inflows could undermine growth, weaken the dollar, and trigger broader financial instability. Moreover, reversing this dynamic is not straightforward—barring a credible structural resurgence in European (or Asian) growth, the global investment landscape remains tilted toward the US.

250501Z4.jpg

**US competitiveness versus Europe, China and Japan** 
The next chart below examines relative unit labour costs across major economies since 2011. The US and China have seen a broadly similar trajectory, with steady increases in relative cost structures, while the euro area has remained flat and Japan has seen dramatic improvement. This suggests that, from a cost competitiveness standpoint, the US is not uniquely disadvantaged vis-à-vis China. However, as we discuss further below, this parallel erosion of cost competitiveness is occurring at much higher nominal wage levels in the US, which blunts its ability to regain export share through tariff-related shifts alone. The trade war strategy—absent a corresponding improvement in productivity or structural reforms—risks imposing costs without delivering material competitiveness gains.

250501Z5.jpg

**Average wages in selected developed and developing economies**
This point is reinforced by the final chart, which shows estimates for average monthly wages across countries in 2024. US labour remains much more expensive than in peer or emerging economies. So even if China’s costs rise in tandem with the US, the global supply chain has ample alternatives. 'China plus one' strategies are accelerating, and the US remains structurally misaligned with low-cost production hubs. Tariffs aimed at reshoring supply chains are unlikely to deliver sustained gains unless accompanied by deep supply-side reforms, and risk further disincentivizing foreign direct investment if global firms perceive US trade policy as erratic or punitive.

250501Z6.jpg

Financial markets found a measure of calm this week, buoyed by some subtle shifts in tone from US policymakers. A softening in the administration’s rhetoric around trade tariffs coupled with a less confrontational stance toward Federal Reserve Chair Jerome Powell, helped ease tensions that had roiled markets earlier in the month. Equities rebounded modestly, and volatility indicators edged lower, reflecting cautious optimism that the worst of the policy shocks may be behind us. But beneath the surface, significant downside risks persist. New shipping data point to a pronounced slowdown in US-China trade flows (chart 1), suggesting the damage from recent tariff escalations is already rippling through global supply chains. Meanwhile, incoming data for the US revealed an unexpected contraction in the economy in Q1 and further signs of weakness in the labour market (chart 2). The US dollar, in the meantime, while long supported by superior growth and yield differentials, has begun to decouple from traditional drivers (charts 3 and 4) suggesting growing pressure on capital flows. At the same time, structural imbalances are drawing renewed scrutiny: unit labour cost comparisons show the US steadily losing competitiveness (chart 5), while nominal wage disparities remain stark versus China and other Asian economies, further complicating any effort to restore trade balance without broader reforms (chart 6). In short, while markets may be drawing temporary comfort from a pause in tariff brinkmanship, the deeper economic and financial vulnerabilities exposed this month remain unresolved—and increasingly central to the global macro narrative.

<iframe style="border-radius:12px" src="https://open.spotify.com/embed/episode/3PzXXKrkHcwtOLipohEdnB?utm_source=generator" width="100%" height="152" frameBorder="0" allowfullscreen="" allow="autoplay; clipboard-write; encrypted-media; fullscreen; picture-in-picture" loading="lazy"></iframe>

Charts of the Week: Tariff Truce, Tenuous Trust

250501F20.jpg

250501G20.jpg

U.S. light vehicle sales dropped 2.9% (+6.5% y/y) to 17.31 million units (SAAR), after surging 10.8% to 17.82 million units in March. The retreat in April vehicle sales accompanied a 1.7% y/y rise in real disposable income through March, which compared to 2.0% growth last year.

Sales declines were broad-based last month. Light truck sales fell 1.3% (+9.9% y/y) during April to 14.34 million units (SAAR), after rising 12.4% in March. Purchases of domestically-made light trucks declined 1.2% (+11.9% y/y) to 11.02 million units, after jumping 12.5% in March. Sales of imported light trucks fell 1.8% (+4.4% y/y) to 3.32 million units, following an 11.6% March surge.

Trucks’ record 82.8% share of the light vehicle market last month compared to 81.5% in March and 80.3% in April of last year. The share averaged 80.3% during all of 2024 versus 53.3% ten years earlier.

Auto sales also declined last month, down 9.5% (-7.5%) to 2.97 million units (SAAR) following a 3.5% March rise. The decline reversed all of the increase over the prior two months. Purchases of domestically-produced cars fell 9.8% (-4.3% y/y) last month to 2.22 million units, after rising 3.8% in March. Sales of imported autos declined 9.6% (-15.7% y/y) to 0.75 million units, following a 2.5% March increase.

Imports' 23.5% share of the U.S. light vehicle market was little changed from 23.6% in March and compared to a May 2023 low of 22.9% and a high of 26.3% in November of 2023. Imports' share of the passenger car market held steady at 25.3% last month and compared to 27.7% in April of last year. It reached a high of 38.7% in September 2021. Imports' share of the light truck market eased to 23.2% last month after falling to 23.3% in March.

U.S. vehicle sales figures can be found in Haver's **USECON** database. Additional detail by manufacturer is in the I**NDUSTRY** database.

250501H20.jpg

250501I20.jpg

- Light truck sales pull back, while auto sales tumble.
- Both domestic and imported sales decline.
- Imports' market share slips further.

U.S. Light Vehicle Sales Fall in April

250501J5.jpg

250501K5.jpg

The ISM Purchasing Managers Index of activity in the manufacturing sector slipped to 48.7 in April from 49.0 during March and 50.3 in February. It remained up from a low of 46.9 in October of last year. A level of 50 is the break-even point between a rising and falling level of activity. The Action Economics Forecast Survey expected a reading of 47.8 for April. The series reached a monthly high of 63.8 in March 2021.

Two of the five component indexes weakened last month. The April production index fell to 44.0 after declining to 48.3 in March. It was the lowest level since May 2020. A lessened 19.8% (NSA) of respondents reported higher production while an increased 24.2% reported lower output. The inventories index declined to 50.8 last month from 53.4 in March. The index remained up from a low of 43.2 in October of last year.

Moving higher, the new orders index rose to 47.2 last month from 45.2 in March. The index remained below a January high of 55.1. Twenty-eight percent (NSA) of respondents reported higher new orders while 26.7% reported a decline. The employment index rose to 46.5 from 44.7 in March. It was below a high of 50.3 in January. A greater 13.1% (NSA) of respondents reported more hiring while a fewer 16.2% indicated less. The supplier delivery index rose to 55.2 from 53.5 in March. A higher 16.6% (NSA) of respondents reported slower delivery speeds while a fairly steady 6.2% reported a quickening.

The prices index, which is not part of the composite series, edged up to 69.8 (NSA) in April after increasing to 69.4 in March. It was the highest level since June 2022, up from a December 2022 low of 39.4. An increased 49.2% of respondents reported higher prices last month, up from 12.2% in November, while a higher 9.7% reported lower prices.

In other series, the export orders index plummeted to 43.1 in April from 49.6 during March. It was down from the high of 52.4 in January. The imports index fell sharply to 47.1 from 50.1 in March. It was the lowest reading since December 2023. The order backlog index dropped to 43.7 (NSA) last month from 44.5 in March. It was the lowest level in five months.

The ISM figures are based on responses from over 400 purchasing executives from 18 industries, which are weighted according to each industry’s contribution to GDP. These indexes are diffusion indexes where a reading above 50 indicates expansion and a reading below 50 points to contraction. The figures from the Institute for Supply Management can be found in Haver’s **USECON** database; further detail is found in the **SURVEYS** database. The expectations number is available in Haver’s **AS1REPNA** database.

250501L5.jpg

250501M5.jpg

- Declines in last three months follow earlier improvement.
- Production & inventories account for m/m shortfall.
- Prices index edges up to another three-year high.

U.S. ISM Manufacturing Index Indicates Contraction in April

Winnie Tapasanun

250501N.jpg

250501O.jpg

The value of construction put in place unexpectedly fell 0.5% m/m in March after rises of 0.6% in February (+0.7% initially) and 0.1% in January (-0.5% previously), data from the U.S. Census Bureau showed. The March reading was the first m/m fall following five straight m/m gains. A 0.3% m/m March rise had been expected in the Action Economics Forecast Survey. The year-on-year rate of increase decelerated to 2.8% in March, the lowest since May 2019, after registering at 3.4% in February and January. The latest y/y figure was lower than 8.7% in March 2024; thus, having remained below its recent high of 9.8% in January 2024 and a peak of 18.6% in April 2022.

Private construction slid 0.6% (+2.3% y/y) in March, down for the first time since September, following increases of 0.7% in February (+0.9% initially) and 0.1% in January (-0.7% previously). Residential private construction fell 0.4% (+2.8% y/y) in March, the first m/m fall in six months, after an unrevised 1.3% gain in February. Home improvement building dropped 1.2% (+13.4% y/y), the first m/m decline since December, following a 2.3% February gain; it was 41.1% of the residential private construction. Single-family building edged up 0.1% (-0.8% y/y), the smallest of seven consecutive m/m increases, after a 0.8% February rise; it was 46.6% of the residential private construction. Meanwhile, multi-family building was essentially unchanged m/m (-12.1% y/y) in March following 15 straight m/m decreases; it was 12.3% of the residential private construction.

Nonresidential private construction fell 0.8% (+1.6% y/y) in March after a 0.1% increase in February (+0.4% initially) and a 0.1% easing in January (-0.2% previously). The March fall reflected m/m drops in the following nonresidential private constructions. These included religious (-2.9%; +16.4% y/y), health care (-2.2%; -5.2% y/y), office (-1.8%; +2.7% y/y), educational (-1.7%; -4.2% y/y), lodging (-1.6%; -1.0% y/y), commercial (-1.0%; -5.8% y/y), manufacturing (-0.4%; +3.6% y/y), communication (-0.3%; +2.2% y/y), and utilities (-0.1%; +7.0% y/y). In contrast, private constructions for amusement & recreation (1.5%; 7.0% y/y) and transportation (0.7%; 10.2% y/y) rose m/m in March.

The value of public construction declined 0.2% (+4.7% y/y) in March after holding steady in February (+0.2% initially), reflecting a 0.2% increase (-1.9% y/y) in residential public construction and a 0.2% easing (+4.8% y/y) in nonresidential public construction. The March decline reflected m/m drops in the following nonresidential public constructions. These included utilities (-4.8%; -12.8% y/y), commercial (-1.6%; +40.3% y/y), amusement & recreation (-1.0%; +19.1% y/y), educational (-0.6%; +7.6% y/y), sewage & waste disposal (-0.6%; +10.6% y/y), and health care (-0.4%; +13.0% y/y). Notably, spending on highways & streets, which made up 28.7% of public construction spending, fell 0.5% (-2.4% y/y) in March, the first m/m fall since October, following a 0.9% increase in February. To the upside, the following public constructions rose m/m in March: office (1.6%; 6.0% y/y), transportation (1.4%; 7.3% y/y), public safety (0.7%; 4.1% y/y), conservation & development (0.6%; 4.7% y/y), and water supply (0.6%; 12.2% y/y).

The construction figures can be found in Haver's **USECON** database. The expectations figure is from the Action Economics Forecast Survey in **AS1REPNA**.

250501P.jpg

250501Q.jpg

- March construction spending -0.5% m/m; +2.8% y/y, the lowest y/y rate since May ’19.
- Residential private construction -0.4% m/m, led by a 1.2% drop in home improvement building.
- Nonresidential private construction -0.8% m/m, down for the second month in three.
- Public sector construction -0.2% m/m, reflecting a 0.2% decline in nonresidential public building.

U.S. Construction Spending Unexpectedly Drops in March, the First M/M Fall Since September

Carol Stone, CBE

250501A8.jpg

250501B8.jpg

Initial claims for unemployment insurance rose 18,000 in the week ended April 26 to 241,000, seasonally adjusted.  This is higher by 16,000 than the Action Economics Forecast Survey amount of 225,000 and is the largest amount since the week of February 22. The previous week’s actual count was revised up by 1,000 to 223,000, from 222,000 reported initially.

The total number of unemployment insurance beneficiaries – also known as “continuing claims” – in the week ended April 19 was 1.916 million, up 83,000 from the prior week’s 1.833 million; that earlier amount was revised down by 8,000.

The insured unemployment rate, that is, the number of beneficiaries as a percentage of covered employment, was 1.3% in the April 19 week, following 1.2% continuously since the week of January 6, 2024.

Economic conditions vary widely across states and territories.  In the week ended April 12, the highest unemployment rates were in New Jersey (2.39%), California (2.24%), Washington (2.19%), Rhode Island (2.17%) and Massachusetts (1.93%).  The lowest rates were in Florida (0.35%), South Dakota (0.40%), Alabama (0.41%), Virginia (0.45%) and Tennessee (0.48%).  Rates in other notable states include the Illinois (1.85%), New York (1.71%), Pennsylvania (1.54%) and Texas (1.09%). These state data are not seasonally adjusted.

Data on weekly unemployment claims are from the Department of Labor itself, not the Bureau of Labor Statistics. They begin in 1967 and are contained in Haver’s **WEEKLY** database and summarized monthly in U**SECON**. Data for individual states are in **REGIONW** back to December 1986. The expectations figure is from the Action Economics Forecast Survey in the **AS1REPNA** database.

250501C8.jpg

250501D8.jpg

- Actual initial claims amount is 16,000 more than forecast.
- Total beneficiaries rose by 83,000.
- Insured unemployment rate ticked up to 1.3% after 15 months at 1.2%.

Economy in Brief: May 2010

Jump to: