Tom Moeller

The Mortgage Bankers Association reported that their total Mortgage Market Volume Index gained 7.3% last week (-6.0% y/y) following two weeks of decline. Applications to refinance a loan rebounded 13.2% (-7.1% y/y) but purchase [...]

U.S. Mortgage Loan Applications Rebound; Interest Rates Back Up

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>
<body>
	 
 
 
 
 <a href="/comment/141210k_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210k.png"></a>
 <a href="/comment/141210l_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210l.png"></a>
 
The Federal Government reported a $56.8 billion budget deficit during
November compared to a $135.2 billion during November of last year. For the
first two months of Fiscal Year 2015, the deficit of $178.5 billion compares to
$-225.8 billion in the first two months of last year. For FY 2015, the Congressional Budget Office projects
the budget deficit will total $469 billion compared to $483.4 billion last year,
then rise to $556 billion in FY 2016

The decline in deficit so far this fiscal year occurred as outlays fell 4.0%
y/y. Spending on income security dropped 17.7% y/y in the first two months of
FY'15 with the improved economy and veterans benefits dropped 15.1% y/y.
Medicare payments were off 8.4% y/y and national defense outlays fell 7.2% y/y.
To the upside was spending on health care programs by 17.6% y/y and spending on
education, training &amp; social services by 15.6% y/y. Net interest spending
rose 5.8% y/y and social security spending increased 4.3% y/y.

Net revenues so far in FY 2015 increased 6.0% y/y. Corporate income taxes
surged by more than three-quarters y/y. Individual income taxes rose 5.9% y/y
and social insurance taxes gained 3.9%. Excise taxes increased 3.1% y/y.

Haver's basic data on Federal Government outlays and receipts are contained
in USECON. Considerable detail is given in the separate GOVFIN
database.

 <a href="/comment/141210m_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210m.png"></a>
 <a href="/comment/141210n_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210n.png"></a> 
 
 
 <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" >&nbsp;US Government Finance</th>
 <th scope="col" ></th>
 <th scope="col" >Nov</th>
 <th scope="col" >FY'14</th>
 <th scope="col" >FY'13</th>
 <th scope="col" >FY'12</th>
 <th scope="col" >FY'11</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" >Budget Balance</td>
 <td >--</td>
 <td >$-56.8 bil.</td>
 <td >$-483.4 bil.</td>
 <td >$-680.3 bil.</td>
 <td >$-1,089.2 bil.</td>
 <td >$-1,296.8 bil.</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;As a percent of GDP</td>
 <td >--</td>
 <td ></td>
 <td >2.8</td>
 <td >4.1</td>
 <td >6.8</td>
 <td >8.4</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" ></td>
 <td >% of Total</td>
 <td >FY'15 YTD</td>
 <td ></td>
 <td ></td>
 <td ></td>
 <td ></td>
 </tr>
 <tr>
 <td class="firstcol" >Net Revenues (Y/Y % Change)</td>
 <td >100</td>
 <td >6.0%</td>
 <td >8.9%</td>
 <td >13.3%</td>
 <td >6.4%</td>
 <td >6.5%</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Individual Income Taxes</td>
 <td >47</td>
 <td >5.9</td>
 <td >5.9</td>
 <td >16.3</td>
 <td >3.7</td>
 <td >21.5</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Corporate Income Taxes</td>
 <td >10</td>
 <td >83.7</td>
 <td >17.3</td>
 <td >12.9</td>
 <td >33.8</td>
 <td >-5.4</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Social Insurance Taxes</td>
 <td >34</td>
 <td >2.9</td>
 <td >8.0</td>
 <td >12.1</td>
 <td >3.2</td>
 <td >-5.3</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp; Excise Taxes</td>
 <td >3</td>
 <td >3.1</td>
 <td >11.1</td>
 <td >6.3</td>
 <td >9.2</td>
 <td >8.2</td>
 </tr>
 <tr>
 <td class="firstcol" ></td>
 <td ></td>
 <td ></td>
 <td ></td>
 <td ></td>
 <td ></td>
 <td ></td>
 </tr>
 <tr>
 <td class="firstcol" >Net Outlays (Y/Y % Change)</td>
 <td >100</td>
 <td >-4.0</td>
 <td >1.4</td>
 <td >-2.4</td>
 <td >-1.7</td>
 <td >4.1</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;National Defense</td>
 <td >18</td>
 <td >-7.2</td>
 <td >-4.7</td>
 <td >-6.3</td>
 <td >-3.9</td>
 <td >1.7</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Health</td>
 <td >10</td>
 <td >17.6</td>
 <td >14.2</td>
 <td >3.1</td>
 <td >-7.0</td>
 <td >1.0</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Medicare</td>
 <td >14</td>
 <td >-8.4</td>
 <td >2.8</td>
 <td >5.5</td>
 <td >-2.8</td>
 <td >7.5</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Income Security</td>
 <td >16</td>
 <td >-17.7</td>
 <td >-4.3</td>
 <td >-1.1</td>
 <td >-9.1</td>
 <td >-4.1</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Social Security</td>
 <td >24</td>
 <td >4.3</td>
 <td >4.6</td>
 <td >5.2</td>
 <td >5.8</td>
 <td >3.4</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp; Veterans Benefits</td>
 <td >4</td>
 <td >-15.1</td>
 <td >7.7</td>
 <td >11.5</td>
 <td >-2.0</td>
 <td >17.3</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp; Education, Training, Employment
 &amp; Social Services</td>
 <td >3</td>
 <td >15.6</td>
 <td >25.9</td>
 <td >-21.9</td>
 <td >-10.3</td>
 <td >-20.6</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Interest</td>
 <td >6</td>
 <td >5.8</td>
 <td >3.0</td>
 <td >0.4</td>
 <td >-3.0</td>
 <td >15.8</td>
 </tr>

 </tbody>
</table>



</body>

</html>

The Federal Government reported a $56.8 billion budget deficit during November compared to a $135.2 billion during November of last year. For the first two months of Fiscal Year 2015, the deficit of $178.5 billion compares to $-225.8 [...]

U.S. Budget Deficit Eases With Less Spending

Robert Brusca

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>

	 
 
 
 

 <a href="/comment/141210j_big.png" name="modal"><img class="large" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210j.png" align="left"></a>

Japan's consumer confidence index in November fell to 37.7 from 38.9 in October. It was last weaker in April of this year. Japan's consumer confidence metric is a diffusion index. It was last above 50 (the expansion/contraction line of demarcation) in February of 2006. It has been over eight years since more households in this survey thought things were improving than thought things were deteriorating. That is a steep challenge to any attempt to brighten Japan's future by affecting expectations (as the BOJ is doing). Since March of 2004, when this report on Confidence began to be issued monthly instead of quarterly, the index has been lower than its current value only 18% of the time.

Japan has had debt problems lurking and threatening its success for well over twenty years. Japan's government has utilized supplemental budgets to try and boost or maintain government spending to keep growth aloft since at least the 1980s. But Japan is a country that has been victimized by its own success. Its determination to penetrate the US market with its exports and keep its position there led to an extraordinary appreciation of the yen. That in turn prompted a combination of responses ranging from outsourcing to increased capital intensity in manufacturing. Those responses for a while buffered Japan from the loss in competitiveness that stemmed from its overly strong exchange rate. But the yen's strength was ultimately Japan's undoing. For years Japan ran a persistent current account surplus and maintained surpluses even in the face of an overvalued yen because it was fearful of oil import costs and because it had a rapidly aging population leading it to have a high savings rate. 

Still, Japan's method to keep growth rolling in a high savings economy was to rely on a build-up of government debt. Debt's ratio to GDP is now enormous and puts Japan in an awkward position internationally especially with an aging AND shrinking population. Japan does owe most of its debt to its own residents. Its recent nuclear calamity led to a nationwide nuclear shutdown that increased oil imports and thrust its current account into deficit for a time. Other than that episode Japan has been accumulating international and domestic assets.

The result of the higher yen was to help boost already high living costs in Japan; that in turn caused many of Japan's youth to decide to forego family formation as a way to deal with high living costs. Japan had pioneered the multigenerational mortgage to help people purchase houses what would have been unattainable with conventional mortgage metrics given skyrocketing housing prices. 

Japan has "an ace in the hole", however. For years Japanese women have been essentially out of the work force or in it only tangentially. But Japanese women have begun to participate more in the job market. The BOJ is still full throttle with QE. These changes give Japan two new opportunities to get a leg up on growth. 

Japan's consumption tax hikes seem to have punched the air out of the economy much more than had been expected. The blow was so great and its effect has been so lasting that the second round of tax hikes has been postponed. However, not all the news in Japan is negative; the yen has slipped but it does not help the economy as it once did because there has been so much outsourcing. The LEI for Japan in November is up for the third month in a row although its gains are slowing. Women are participating in the economy to a greater extent and the BOJ policy of QE is still in force. 

Japan still has challenges ahead. One key might be for Japan's consumers to embrace a new way of life. It seems pretty clear that Japan will not in the future be the same as it was in the Post War period. The strong yen and excessive outsourcing to protect Japan's Kiritsu export markets has come at a heavy cost. But Japan is defiant about remaining a homogenous population; it will not solve the challenges of its shrinking population through immigration. That means Japan must find a new way to grow and a new way to prosper and to improve confidence.

Much of Japan's future revolves around its people's ability to navigate the economic maze that has become an ever changing challenge to prosperity. Japan seems to be trying to find a new way rather than just sticking to old practices that got it in trouble. That is the reason for hope. But hope has not yet become confidence.


<img border="0" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210.png" width="600" height="280"></html>

Japan's consumer confidence index in November fell to 37.7 from 38.9 in October. It was last weaker in April of this year. Japan's consumer confidence metric is a diffusion index. It was last above 50 (the expansion/contraction line [...]

Consumer Confidence in Japan Withers: What of the Future?

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>
<body>
	 
 
 
 
 <a href="/comment/141210e_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210e.png"></a>
 <a href="/comment/141210f_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210f.png"></a>
Prices for industrial materials are showing broad-based decline. The
industrial commodity price index from the Foundation for International Business
and Economic Research (FIBER) fell 7.4% as of yesterday versus one year ago.
Declines amongst the component series were widespread

<a href="/comment/141210g_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210g.png" align="left"></a>

The crude oil &amp; benzene grouping continued to lead the weakness
with a 20.0% y/y decline, reflecting a 35.9% y/y decline in the price of WTI
crude oil to $62.56 per barrel. That's down 41.8% since June. In addition,
prices for the petrochemical benzene fell just over one-third from late-June.
Prices in the miscellaneous category also were weak. They've softened 5.7%
from last year as natural rubber prices fell by more than one-third y/y. Framing
lumber also eased 5.7% y/y. Prices for random lengths of structural composite
have weakened since November but remain 7.4% higher y/y. Textile prices
also declined 4.1% during the last year, paced by a one-quarter y/y decline in
cotton prices. A 3.8% y/y increase in burlap prices countered this decline. Metals
prices were not quite as weak, but still fell 3.1% during the last year.
Aluminum prices have been buoyant, up 12.1% y/y. Steel scrap prices, however,
turned down recently by 14.3% y/y. Copper scrap prices are off 9.5% y/y.
Future support for commodity prices may be on the way. The current industrial
output projection from the National Association for Business Economics calls for
3.5% growth in industrial production in 2015. During the last ten years there
has been a 52% correlation between the three-month change in prices and the
change in industrial output.
Commodity price data can be found in Haver's DAILY, WEEKLY, USECON and
CMDTY databases.

 <a href="/comment/141210h_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210h.png"></a>
 <a href="/comment/141210i_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210i.png"></a> 
 
 
 <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" >FIBER Industrial Materials
 Price Index (1990=100)</th>
 <th scope="col" >12/09/14</th>
 <th scope="col" >Y/Y %</th>
 <th scope="col" >2013</th>
 <th scope="col" >2012</th>
 <th scope="col" >2011</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" >All Items</td>
 <td>152.77</td>
 <td>-7.4</td>
 <td>169.0</td>
 <td>166.4</td>
 <td>173.0</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" >&nbsp;Textiles</td>
 <td>74.15</td>
 <td>-4.1</td>
 <td>78.2</td>
 <td>77.9</td>
 <td>86.1</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Cotton (cents per pound)</td>
 <td>58.01</td>
 <td>-24.8</td>
 <td>79.6</td>
 <td>74.5</td>
 <td>132.8</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" >&nbsp;Metals</td>
 <td>227.98</td>
 <td>-3.1</td>
 <td>236.3</td>
 <td>243.0</td>
 <td>278.7</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Aluminum ($ per metric ton)</td>
 <td>1,959.50</td>
 <td>12.1</td>
 <td>1,846.3</td>
 <td>2,019.6</td>
 <td>2,400.9</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Copper Scrap (cents per
 pound)</td>
 <td>293.2</td>
 <td>-9.5</td>
 <td>332.4</td>
 <td>360.6</td>
 <td>400.3</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Steel Scrap ($ per ton)</td>
 <td>309.00</td>
 <td>-14.3</td>
 <td>346.0</td>
 <td>366.7</td>
 <td>412.6</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" >&nbsp;Crude Oil &amp; Benzene</td>
 <td>166.37</td>
 <td>-20.0</td>
 <td>207.7</td>
 <td>204.1</td>
 <td>199.3</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Crude Oil (WTI, $ per
 Barrel)</td>
 <td>62.56</td>
 <td>-35.9</td>
 <td>97.9</td>
 <td>94.2</td>
 <td>95.0</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" >&nbsp;Miscellaneous</td>
 <td>190.06</td>
 <td>-7.1</td>
 <td>218.3</td>
 <td>205.3</td>
 <td>190.6</td>
 </tr>
 <tr>
 <td class="firstcol" >&nbsp;&nbsp;Framing Lumber ($ per 1000
 board ft.)</td>
 <td>366</td>
 <td>-5.7</td>
 <td>383</td>
 <td>321</td>
 <td>273</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >&nbsp;&nbsp;Natural Rubber (cents per
 pound)</td>
 <td>110.95</td>
 <td>-39.6</td>
 <td>189.9</td>
 <td>211.9</td>
 <td>262.3</td>
 </tr>
 
 
 </tbody>
</table>



</body>

</html>

Prices for industrial materials are showing broad-based decline. The industrial commodity price index from the Foundation for International Business and Economic Research (FIBER) fell 7.4% as of yesterday versus one year ago. Declines [...]

FIBER: Industrial Commodity Prices Remain In Retreat

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>
<body>
	 
 
 
 
 <a href="/comment/141210a_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210a.png"></a>
 <a href="/comment/141210b_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210b.png"></a>
The Mortgage Bankers Association reported that their total Mortgage Market
Volume Index gained 7.3% last week (-6.0% y/y) following two weeks of decline.
Applications to refinance a loan rebounded 13.2% (-7.1% y/y) but purchase
applications improved a lesser 1.3% (-4.5% y/y).
The effective interest rate on a 15-year mortgage nudged up w/w to 3.43%
following two weeks of decline. The effective rate on a 30-year fixed rate loan
also gained slightly to 4.19%. The rate on a Jumbo 30-year loan slipped to&nbsp;
4.11%. For adjustable 5-year mortgages, the effective interest rate of 3.18% was
stable w/w and remained down versus last year's 3.74% peak.
The average mortgage loan size improved to $255,400. For home purchases, it
declined to $276,000; for refinancings, it improved to $243,700.
Applications for fixed interest rate loans declined 4.8% y/y while adjustable
rate loan applications fell 19.7% y/y.
The survey covers over 75 percent of all U.S. retail residential mortgage
applications, and has been conducted weekly since 1990. Respondents include
mortgage bankers, commercial banks and thrifts. The base period and value for
all indexes is March 16, 1990=100. The figures for weekly mortgage applications
and interest rates are available in Haver's SURVEYW database.

 <a href="/comment/141210C_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210c.png"></a>
 <a href="/comment/141210D_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141210d.png"></a> 
 
 
 <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" 0925 0918 >MBA Mortgage
 Applications (SA, 3/16/90=100)</th>
 <th scope="col" 0925 0918 >12/05/14</th>
 <th scope="col" 0925 0918 >11/28/14</th>
 <th scope="col" 0925 0918 >11/21/14</th>
 <th scope="col" 0925 0918 >Y/Y %</th>
 <th scope="col" 0925 0918 >2013</th>
 <th scope="col" 0925 0918 >2012</th>
 <th scope="col" 0925 0918 >2011</th>
 </tr>
 </thead>
 <tbody>
 <tr class="odd">
 <td class="firstcol" 0925 0918 >Total Market Index</td>
 <td 0925 0918 >372.3</td>
 <td 0925 0918 >347.0</td>
 <td 0925 0918 >374.5</td>
 <td 0925 0918 >-6.0</td>
 <td 0925 0918 >616.6</td>
 <td 0925 0918 >813.8</td>
 <td 0925 0918 >572.3</td>
 </tr>
 <tr>
 <td class="firstcol" 0925 0918 >&nbsp;Purchase</td>
 <td 0925 0918 >177.7</td>
 <td 0925 0918 >175.5</td>
 <td 0925 0918 >171.2</td>
 <td 0925 0918 >-4.5</td>
 <td 0925 0918 >197.5</td>
 <td 0925 0918 >187.8</td>
 <td 0925 0918 >182.6</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" 0925 0918 >&nbsp;Refinancing</td>
 <td 0925 0918 >1,518.7</td>
 <td 0925 0918 >1,341.1</td>
 <td 0925 0918 >1,549.0</td>
 <td 0925 0918 >-7.1</td>
 <td 0925 0918 >3,070.0</td>
 <td 0925 0918 >4,505.0</td>
 <td 0925 0918 >2,858.4</td>
 </tr>
 <tr>
 <td class="firstcol" 0925 0918 >15-Year Mortgage Effective
 Interest Rate (%)</td>
 <td 0925 0918 >3.43</td>
 <td 0925 0918 >3.36</td>
 <td 0925 0918 >3.41</td>
 <td 0925 0918 >3.78 
 (12/13)</td>
 <td 0925 0918 >3.42</td>
 <td 0925 0918 >3.25</td>
 <td 0925 0918 >3.97</td>
 </tr> 
 </tbody>
</table>



</body>

</html>

<html>

<head>
<meta http-equiv="Content-Type" content="text/html; charset=windows-1252">
<meta name="GENERATOR" content="Microsoft FrontPage 4.0">
<meta name="ProgId" content="FrontPage.Editor.Document">
<title>U</title>
</head>



 

The job openings rate during October ticked up to 3.3%, close to where
it's been for six months. The job openings rate is the number of job openings
on the last business day of the month as a percent of total employment plus job
openings. The actual number of job openings surged 21.0% y/y to 4.834
million. The Bureau of Labor Statistics reports these figures in its Job
Openings &amp; Labor Turnover Survey (JOLTS).
The private-sector job openings rate recovered to 3.6% its highest level
since April 2001, up from the recession low of 1.7%. The rate in leisure &amp;
hospitality businesses was 4.7%, the highest point since May. The rate in the
professional &amp; business services industries held at 4.6% for the third
straight month and in the health care &amp; social assistance sector it remained
high at 4.1%. The 3.1% rate in trade, transportation &amp; utilities industries
was up from the recession low of 1.2%. The 2.3% rate in the factory sector was
down after five months at 2.4%. The construction rate improved to 2.2%. The job
openings rate in the government sector fell m/m to 1.8%, its lowest level since
March..
The hires rate held at its cycle high of 3.6%. The hires rate is
the number of hires during the month divided by employment. The private
sector hires rate slipped to 4.1%. Amongst leisure &amp; hospitality firms the
rate held at 6.0%. The rate in professional &amp; business services retreated to
5.6% but in construction it improved to 5.0%. The hiring rate in education
slipped to 2.8% but in the factory sector it held at 2.3%. In the government
sector the hiring rate held at a low 1.4%. 
The number of hires slipped 0.4% m/m but increased 12.0% y/y. Private sector
hires rose 12.2% y/y. Professional &amp; business services hiring increased 21.8%
y/y and factory sector employment grew 20.1% y/y. Trade, transportation &amp;
utilities jobs rose 18.3% y/y. Hiring in the health care &amp; social assistance
sector improved 13.4% y/y and leisure &amp; hospitality sector employment
increased 8.6%. Government hiring rose 8.9% y/y.
The job separations rate jumped to 3.5% and the actual number of separations
increased 12.1% y/y. Separations include quits, layoffs, discharges, and
other separations as well as retirements. The private sector separations
rate held at 3.8%, while the government sector's rate inched remained at 1.4%.
The layoff &amp; discharge rate held near the record low of 1.2%. The
private sector layoff rate inched up m/m to 1.4% and the government's rate was
steady at 0.4%.
The JOLTS survey dates to December 2000 and the figures are available
in Haver's USECON database.
<table class="centered" width="1871" border="0" cellspacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1025"><a href="http://www.haverselect.com/dlx/USECON/@EB/@EB14/@EB14.HTM">JOLTS
 (Job Openings &amp; Labor Turnover Survey, SA)</a></th>
 <th scope="col" width="120">Oct</th>
 <th scope="col" width="120">Sep</th>
 <th scope="col" width="120">Aug</th>
 <th scope="col" width="120">Oct.'13</th>
 <th scope="col" width="120">2013</th>
 <th scope="col" width="121">2012</th>
 <th scope="col" width="121">2011</th>
 </tr>
 </thead>
 <tbody>
 <tr class="grey3">
 <td class="firstcol" colspan="7" width="1746">Job Openings, Total</td>
 </tr>
 <tr>
 <td class="firstcol" width="1025">&nbsp;Rate (%)</td>
 <td align="center" width="120">3.3</td>
 <td align="center" width="120">3.2</td>
 <td align="center" width="120">3.4</td>
 <td align="center" width="120">2.8</td>
 <td align="center" width="120">2.8</td>
 <td align="center" width="121">2.6</td>
 <td align="center" width="121">2.5</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1025">&nbsp;Total (000s)</td>
 <td align="center" width="120">4,834</td>
 <td align="center" width="120">4,685</td>
 <td align="center" width="120">4,853</td>
 <td align="center" width="120">21.0%</td>
 <td align="center" width="120">7.4%</td>
 <td align="center" width="121">3.1%</td>
 <td align="center" width="121">22.4%</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" colspan="7" width="1746">Hires, Total</td>
 </tr>
 <tr>
 <td class="firstcol" width="1025">&nbsp;Rate (%)</td>
 <td align="center" width="120">3.6</td>
 <td align="center" width="120">3.6</td>
 <td align="center" width="120">3.4</td>
 <td align="center" width="120">3.4</td>
 <td align="center" width="120">39.6</td>
 <td align="center" width="121">38.8</td>
 <td align="center" width="121">38.1</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1025">&nbsp;Total (000s)</td>
 <td align="center" width="120">5,055</td>
 <td align="center" width="120">5,075</td>
 <td align="center" width="120">4,742</td>
 <td align="center" width="120">12.0%</td>
 <td align="center" width="120">3.3%</td>
 <td align="center" width="121">4.2%</td>
 <td align="center" width="121">3.0%</td>
 </tr>
 <tr class="grey3">
 <td class="firstcol" colspan="7" width="1746">Layoffs &amp; Discharges,
 Total</td>
 </tr>
 <tr>
 <td class="firstcol" width="1025">&nbsp;Rate (%)</td>
 <td align="center" width="120">1.2</td>
 <td align="center" width="120">1.2</td>
 <td align="center" width="120">1.2</td>
 <td align="center" width="120">1.1</td>
 <td align="center" width="120">14.6</td>
 <td align="center" width="121">15.5</td>
 <td align="center" width="121">15.7</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1025">&nbsp;Total (000s)</td>
 <td align="center" width="120">2.8%</td>
 <td align="center" width="120">2.1%</td>
 <td align="center" width="120">-6.2%</td>
 <td align="center" width="120">9.9%</td>
 <td align="center" width="120">-4.6%</td>
 <td align="center" width="121">1.2%</td>
 <td align="center" width="121">-4.8%</td>
 </tr>
 </tbody>
</table>
&nbsp;
U.S. Small Business Optimism Jumps to New High 
by <a href="http://haver.com/comment/Moeller.html">Tom Moeller</a>&nbsp;&nbsp;December
9, 2014
The National Federation of Independent Business reported that its Small
Business Optimism Index for November improved to 98.1 following an unrevised
gain to 96.1 during October. The latest level was the highest since February
2007.
Improvement in the component series versus October included the percentage of
firms expecting higher real sales. The percentage planning to increase
employment rose to its highest level since July but the percentage indicating
few or no qualified applicants for job positions remained near its cycle high.&nbsp;

The percentage of companies indicated that now was a good time to expand the
business held near its recovery peak. The percentage indicating that credit was
harder to get ticked up m/m but remained near the lowest level since 2006. The
percentage planning to add to inventories slipped versus its recent high as did
the percentage planning capital expenditures.
On the pricing front, the percentage of firms raising prices returned to the
lowest level in nine months. The percentage planning price increases ticked
lower. Labor's pricing power firmed somewhat. The percentage of firms raising
worker compensation increased to its highest point in three months. The
percentage planning to raise compensation returned to its highest level since
March 2008.
The most important problems faced by small business were taxes (23%),
government requirements (22%), poor sales (12%), quality of labor (10%),
competition from large businesses (8%), insurance cost &amp; availability (7%),
cost of labor (5%), inflation (3%) and financial &amp; interest rates (3%).
Roughly 24 million small businesses exist in the U.S. and they create 80% of
all new jobs. The typical NFIB member employs 10 people and reports gross sales
of about $500,000 a year. The NFIB figures can be found in Haver's SURVEYS
database.
<table class="centered" width="1871" border="0" cellspacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="1206">National Federation of
 Independent Business</th>
 <th scope="col" width="94">Nov</th>
 <th scope="col" width="94">Oct</th>
 <th scope="col" width="94">Sep</th>
 <th scope="col" width="94">Nov'13</th>
 <th scope="col" width="95">2013</th>
 <th scope="col" width="95">2012</th>
 <th scope="col" width="95">2011</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="1206">Small Business Optimism Index (SA,
 1986=100)</td>
 <td align="center" width="94">98.1</td>
 <td align="center" width="94">96.1</td>
 <td align="center" width="94">95.3</td>
 <td align="center" width="94">92.5</td>
 <td align="center" width="95">92.4</td>
 <td align="center" width="95">92.2</td>
 <td align="center" width="95">91.4</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1206">Firms Expecting Higher Real Sales In Six
 Months (SA, Net %)</td>
 <td align="center" width="94">14</td>
 <td align="center" width="94">9</td>
 <td align="center" width="94">5</td>
 <td align="center" width="94">3</td>
 <td align="center" width="95">4</td>
 <td align="center" width="95">2</td>
 <td align="center" width="95">3</td>
 </tr>
 <tr>
 <td class="firstcol" width="1206">Firms Expecting Economy To Improve (SA,
 Net %)</td>
 <td align="center" width="94">13</td>
 <td align="center" width="94">-3</td>
 <td align="center" width="94">-2</td>
 <td align="center" width="94">-20</td>
 <td align="center" width="95">-15</td>
 <td align="center" width="95">-9</td>
 <td align="center" width="95">-9</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1206">Firms Planning to Increase Employment
 (SA, Net %)</td>
 <td align="center" width="94">11</td>
 <td align="center" width="94">10</td>
 <td align="center" width="94">9</td>
 <td align="center" width="94">9</td>
 <td align="center" width="95">6</td>
 <td align="center" width="95">4</td>
 <td align="center" width="95">3</td>
 </tr>
 <tr>
 <td class="firstcol" width="1206">Firms With Few or No Qualified
 Applicants For Job Openings (SA, %)</td>
 <td align="center" width="94">45</td>
 <td align="center" width="94">45</td>
 <td align="center" width="94">42</td>
 <td align="center" width="94">44</td>
 <td align="center" width="95">39</td>
 <td align="center" width="95">35</td>
 <td align="center" width="95">32</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="1206">Firms Reporting That Credit Was Harder
 To Get (SA, Net %)</td>
 <td align="center" width="94">5</td>
 <td align="center" width="94">4</td>
 <td align="center" width="94">7</td>
 <td align="center" width="94">6</td>
 <td align="center" width="95">6</td>
 <td align="center" width="95">8</td>
 <td align="center" width="95">10</td>
 </tr>
 <tr>
 <td class="firstcol" width="1206">Firms Raising Average Selling Prices
 (SA, Net %)</td>
 <td align="center" width="94">4</td>
 <td align="center" width="94">8</td>
 <td align="center" width="94">4</td>
 <td align="center" width="94">2</td>
 <td align="center" width="95">2</td>
 <td align="center" width="95">4</td>
 <td align="center" width="95">5</td>
 </tr>
 </tbody>
</table>

&nbsp;
U.S. Gasoline Price Decline Accelerates, Sparking Demand 
by <a href="http://haver.com/comment/Moeller.html">Tom Moeller</a>&nbsp;&nbsp;December
9, 2014
The price for a gallon of regular gasoline slumped last week to an
average $2.68 (-18.0% y/y) versus $2.78 during the prior week. The 3.6% weekly
decline was the quickest since prices hit their peak in 2011. Prices remained
down versus an interim peak of $3.65 reached this past June. Haver Analytics
constructs factors adjusting for the seasonal variation in pump prices. The
seasonally adjusted price slipped to $2.92 per gallon.
WTI crude oil prices slumped to an average $67.20 last week (-30.2%
y/y) from $72.36 during the prior period. Yesterday prices were down further to
$63.05. The seasonally adjusted price generated by Haver declined to $69.36 per
barrel last week. Brent crude oil prices fell to $70.07 last week (-37.5% y/y)
and were $65.87 yesterday.
Natural gas prices declined last week to $3.65 per mmbtu (-7.3% y/y)
and fell further to $3.49 yesterday.
The demand for all petroleum products declined 0.6% y/y in the week
ended November 28 but gasoline demand improved 3.2% y/y as prices fell.
Inventories of crude oil and petroleum products increased 1.4% y/y but gasoline
inventories declined 1.8% y/y.
The energy price data are reported by the U.S. Department of Energy and can
be found in Haver's WEEKLY database. The daily figures are in DAILY
and the petroleum demand and inventory figures are in OILWKLY.
<table class="centered" width="1871" border="0" cellspacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="864">Weekly Energy Prices</th>
 <th scope="col" width="143">12/08/14</th>
 <th scope="col" width="143">12/01/14</th>
 <th scope="col" width="143">11/24/14</th>
 <th scope="col" width="143">Y/Y%</th>
 <th scope="col" width="143">2013</th>
 <th scope="col" width="144">2012</th>
 <th scope="col" width="144">2011</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="864">Retail Gasoline ($ per Gallon, Regular)</td>
 <td align="center" width="143">2.68</td>
 <td align="center" width="143">2.78</td>
 <td align="center" width="143">2.82</td>
 <td align="center" width="143">-18.0</td>
 <td align="center" width="143">3.51</td>
 <td align="center" width="144">3.62</td>
 <td align="center" width="144">3.52</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="864">Light Sweet Crude Oil, WTI ($ per bbl.,
 WSJ)</td>
 <td align="center" width="143">67.20</td>
 <td align="center" width="143">72.36</td>
 <td align="center" width="143">75.38</td>
 <td align="center" width="143">-30.2</td>
 <td align="center" width="143">97.95</td>
 <td align="center" width="144">94.20</td>
 <td align="center" width="144">95.14</td>
 </tr>
 <tr>
 <td class="firstcol" width="864">Natural Gas ($/mmbtu, LA, WSJ)</td>
 <td align="center" width="143">3.65</td>
 <td align="center" width="143">4.17</td>
 <td align="center" width="143">4.33</td>
 <td align="center" width="143">-7.3</td>
 <td align="center" width="143">3.73</td>
 <td align="center" width="144">2.75</td>
 <td align="center" width="144">3.99</td>
 </tr>
 </tbody>
</table>

&nbsp;
U.S. Wholesale Inventory Growth Outpaces Sales 
by <a href="http://haver.com/comment/Moeller.html">Tom Moeller</a>&nbsp;&nbsp;December
9, 2014
Inventories in the wholesale sector during October
increased 0.4% (6.8% y/y) following an revised 0.4% September rise, earlier
reported as 0.3%. Nondurable goods inventories led the gain with a 1.2% increase
4.2% y/y), paced by a 3.2% gain (20.0% y/y) in drugs &amp; sundries. Paper &amp;
paper products inventories increased 1.6% (2.6% y/y) and groceries gained 1.1%
(4.1% y/y). To the downside were petroleum inventories, off 1.9% (-17.0% y/y),
and chemical inventories by 1.8% (+2.6% y/y). Durable goods inventories were
roughly unchanged (8.5% y/y) as a 1.6% rise (10.7% y/y) in hardware, plumbing
&amp; heating equipment was offset by a 1.4% drop (+7.9% y/y) in motor vehicles.
Furniture inventories also fell 0.7% (+3.6% y/y). 
Wholesale sector sales gained 0.2% (4.3% y/y) after no
change in September, last month reported a +0.2%. Durable goods sales improved
0.8% (6.0% y/y). Electronic product sales increased 1.9% (4.6% y/y) and computer
equipment sales rose 1.5% (2.9% y/y). Nondurable goods sales fell 0.3% (+2.8%
y/y) as petroleum sales declined 5.8% (-8.7% y/y). Chemical product sales
increased 3.0% (5.9% y/y) while paper product sales rose 1.0% (4.0% y/y).
The inventory-to-sales ratio was unchanged at 1.19 for
the third straight month. The durable goods ratio of 1.57 reflected 2.43 in the
machinery sector and 1.02 in electronic goods. The I/S ratio for nondurable
goods increased to 0.86 as apparel held at 1.90 and petroleum ticked up to 0.32.

The wholesale trade figures are available in Haver's USECON database.
<table class="centered" width="1871" border="0" cellspacing="0">
 <thead>
 <tr>
 <th class="firstcol" scope="col" width="957">Wholesale Sector - NAICS
 Classification (%)</th>
 <th scope="col" width="130">Oct</th>
 <th scope="col" width="130">Sep</th>
 <th scope="col" width="130">Aug</th>
 <th scope="col" width="130">Y/Y</th>
 <th scope="col" width="130">2013</th>
 <th scope="col" width="130">2012</th>
 <th scope="col" width="130">2011</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" width="957">Inventories</td>
 <td align="center" width="130">0.4</td>
 <td align="center" width="130">0.4</td>
 <td align="center" width="130">0.6</td>
 <td align="center" width="130">6.8</td>
 <td align="center" width="130">4.0</td>
 <td align="center" width="130">5.5</td>
 <td align="center" width="130">9.4</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" width="957">Sales</td>
 <td align="center" width="130">0.2</td>
 <td align="center" width="130">0.0</td>
 <td align="center" width="130">-0.8</td>
 <td align="center" width="130">4.3</td>
 <td align="center" width="130">4.3</td>
 <td align="center" width="130">4.8</td>
 <td align="center" width="130">12.4</td>
 </tr>
 <tr>
 <td class="firstcol" width="957">I/S Ratio</td>
 <td align="center" width="130">1.19</td>
 <td align="center" width="130">1.19</td>
 <td align="center" width="130">1.19</td>
 <td align="center" width="130">1.16 (Oct.'13)</td>
 <td align="center" width="130">1.17</td>
 <td align="center" width="130">1.18</td>
 <td align="center" width="130">1.15</td>
 </tr>
 </tbody>
</table>





</html>

The job openings rate during October ticked up to 3.3%, close to where it's been for six months. The job openings rate is the number of job openings on the last business day of the month as a percent of total employment plus job [...]

U.S. JOLTS: Job Openings Rate Improves as Hiring Remains Firm

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>

	 
 
 
 
 <a href="/comment/141209n_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141209n.png" align="left"></a>
Inventories in the wholesale sector during October
increased 0.4% (6.8% y/y) following an revised 0.4% September rise, earlier
reported as 0.3%. Nondurable goods inventories led the gain with a 1.2% increase
4.2% y/y), paced by a 3.2% gain (20.0% y/y) in drugs &amp; sundries. Paper &amp;
paper products inventories increased 1.6% (2.6% y/y) and groceries gained 1.1%
(4.1% y/y). To the downside were petroleum inventories, off 1.9% (-17.0% y/y),
and chemical inventories by 1.8% (+2.6% y/y). Durable goods inventories were
roughly unchanged (8.5% y/y) as a 1.6% rise (10.7% y/y) in hardware, plumbing
&amp; heating equipment was offset by a 1.4% drop (+7.9% y/y) in motor vehicles.
Furniture inventories also fell 0.7% (+3.6% y/y). 
Wholesale sector sales gained 0.2% (4.3% y/y) after no
change in September, last month reported a +0.2%. Durable goods sales improved
0.8% (6.0% y/y). Electronic product sales increased 1.9% (4.6% y/y) and computer
equipment sales rose 1.5% (2.9% y/y). Nondurable goods sales fell 0.3% (+2.8%
y/y) as petroleum sales declined 5.8% (-8.7% y/y). Chemical product sales
increased 3.0% (5.9% y/y) while paper product sales rose 1.0% (4.0% y/y).
The inventory-to-sales ratio was unchanged at 1.19 for
the third straight month. The durable goods ratio of 1.57 reflected 2.43 in the
machinery sector and 1.02 in electronic goods. The I/S ratio for nondurable
goods increased to 0.86 as apparel held at 1.90 and petroleum ticked up to 0.32.
The wholesale trade figures are available in Haver's USECON database. 

 <a href="/comment/141209o_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141209o.png"></a>
 <a href="/comment/141209p_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141209p.png"></a> 
 
 
 <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" >Wholesale Sector - NAICS
 Classification (%)</th>
 <th scope="col" >Oct</th>
 <th scope="col" >Sep</th>
 <th scope="col" >Aug</th>
 <th scope="col" >Y/Y</th>
 <th scope="col" >2013</th>
 <th scope="col" >2012</th>
 <th scope="col" >2011</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" >Inventories</td>
 <td >0.4</td>
 <td >0.4</td>
 <td >0.6</td>
 <td >6.8</td>
 <td >4.0</td>
 <td >5.5</td>
 <td >9.4</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Sales</td>
 <td >0.2</td>
 <td >0.0</td>
 <td >-0.8</td>
 <td >4.3</td>
 <td >4.3</td>
 <td >4.8</td>
 <td >12.4</td>
 </tr>
 <tr>
 <td class="firstcol" >I/S Ratio</td>
 <td >1.19</td>
 <td >1.19</td>
 <td >1.19</td>
 <td >1.16 (Oct.'13)</td>
 <td >1.17</td>
 <td >1.18</td>
 <td >1.15</td>
 </tr> 
 </tbody>
</table>






</html>

Inventories in the wholesale sector during October increased 0.4% (6.8% y/y) following an revised 0.4% September rise, earlier reported as 0.3%. Nondurable goods inventories led the gain with a 1.2% increase 4.2% y/y), paced by a 3.2% [...]

U.S. Wholesale Inventory Growth Outpaces Sales

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<html><head>
</head>
<body>
	 
 
 
 
 <a href="/comment/141209J_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141209j.png"></a>
 <a href="/comment/141209K_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141209k.png"></a>
The price for a gallon of regular gasoline slumped last week to an
average $2.68 (-18.0% y/y) versus $2.78 during the prior week. The 3.6% weekly
decline was the quickest since prices hit their peak in 2011. Prices remained
down versus an interim peak of $3.65 reached this past June. Haver Analytics
constructs factors adjusting for the seasonal variation in pump prices. The
seasonally adjusted price slipped to $2.92 per gallon.
WTI crude oil prices slumped to an average $67.20 last week (-30.2%
y/y) from $72.36 during the prior period. Yesterday prices were down further to
$63.05. The seasonally adjusted price generated by Haver declined to $69.36 per
barrel last week. Brent crude oil prices fell to $70.07 last week (-37.5% y/y)
and were $65.87 yesterday.
Natural gas prices declined last week to $3.65 per mmbtu (-7.3% y/y)
and fell further to $3.49 yesterday.
The demand for all petroleum products declined 0.6% y/y in the week
ended November 28 but gasoline demand improved 3.2% y/y as prices fell.
Inventories of crude oil and petroleum products increased 1.4% y/y but gasoline
inventories declined 1.8% y/y.
The energy price data are reported by the U.S. Department of Energy and can
be found in Haver's WEEKLY database. The daily figures are in DAILY
and the petroleum demand and inventory figures are in OILWKLY.

 <a href="/comment/141209L_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141209l.png"></a>
 <a href="/comment/141209M_big.png" name="modal"><img class="small" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/141209m.png"></a> 
 
 
 <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" >Weekly Energy Prices</th>
 <th scope="col">12/08/14</th>
 <th scope="col">12/01/14</th>
 <th scope="col">11/24/14</th>
 <th scope="col">Y/Y%</th>
 <th scope="col">2013</th>
 <th scope="col" >2012</th>
 <th scope="col" >2011</th>
 </tr>
 </thead>
 <tbody>
 <tr>
 <td class="firstcol" >Retail Gasoline ($ per Gallon, Regular)</td>
 <td>2.68</td>
 <td>2.78</td>
 <td>2.82</td>
 <td>-18.0</td>
 <td>3.51</td>
 <td >3.62</td>
 <td >3.52</td>
 </tr>
 <tr class="odd">
 <td class="firstcol" >Light Sweet Crude Oil, WTI ($ per bbl.,
 WSJ)</td>
 <td>67.20</td>
 <td>72.36</td>
 <td>75.38</td>
 <td>-30.2</td>
 <td>97.95</td>
 <td >94.20</td>
 <td >95.14</td>
 </tr>
 <tr>
 <td class="firstcol" >Natural Gas ($/mmbtu, LA, WSJ)</td>
 <td>3.65</td>
 <td>4.17</td>
 <td>4.33</td>
 <td>-7.3</td>
 <td>3.73</td>
 <td >2.75</td>
 <td >3.99</td>
 </tr>
 </tbody>
</table>



</body>

</html>

The price for a gallon of regular gasoline slumped last week to an average $2.68 (-18.0% y/y) versus $2.78 during the prior week. The 3.6% weekly decline was the quickest since prices hit their peak in 2011. Prices remained down [...]

U.S. Gasoline Price Decline Accelerates, Sparking Demand

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: 2014

Jump to:

U.S. Mortgage Loan Applications Rebound; Interest Rates Back Up

U.S. Budget Deficit Eases With Less Spending

Consumer Confidence in Japan Withers: What of the Future?

FIBER: Industrial Commodity Prices Remain In Retreat

U.S. Mortgage Loan Applications Rebound; Interest Rates Back Up

U.S. JOLTS: Job Openings Rate Improves as Hiring Remains Firm

U.S. Wholesale Inventory Growth Outpaces Sales

U.S. Gasoline Price Decline Accelerates, Sparking Demand