Economic Update

HIRING REBOUNDS IN APRIL Employers added 223,000 new jobs last month, the Labor Department noted Friday. That news made the March payroll gain of 85,000 look like an aberration. The main jobless rate fell to a 7-year low of 5.4% in April, and the U-6 rate tracking the total unemployed ticked down to 10.8%; the…

PERSONAL SPENDING IMPROVES, Q1 GDP POOR Consumer spending rose 0.4% in March, the Commerce Department noted; that doubled the February advance. Personal incomes were flat, however. The Bureau of Economic Analysis said the economy grew 0.2% in the first quarter; in better news, private-sector wages rose 2.8% in Q1. Another major indicator stayed flat in…

NEW HOME SALES DROP, RESALES CLIMB March brought a 6.1% advance for existing home sales according to the National Association of Realtors. This happened with a 4.6-month inventory of homes for resale, which is underneath the 6-month level characteristic of a thriving housing market. New home purchases tumbled 11.4% in March after a great February;…

MODERATE INFLATION RESUMES The Consumer Price Index rose 0.2% for a second consecutive month in March, as did the Producer Price Index (in a marked departure from its 0.5% February retreat). Economists polled by MarketWatch had forecast an 0.3% March advance in both the headline CPI and PPI. GROUNDBREAKING UP 2.0% FOR MARCH Housing industry…

SERVICE SECTOR CONTINUES TO EXPAND At 56.5, the Institute for Supply Management’s March non-manufacturing index came in 0.4 points beneath its February reading but still indicated healthy expansion for the service industry. While business activity fell by 1.9%, new orders improved 1.1% and new export orders 6.0%. America’s service sector grew for a 62nd straight…

EMPLOYERS ADD JUST 126,000 JOBS IN MARCH What led to this moderation in hiring, which snapped a yearlong streak of payrolls expanding by 200,000 or more per month? Are dollar strength and low oil prices now hampering corporate profits? Did the weather have an impact? Whatever the underlying causes, the Labor Department’s March report was…

HOME SALES PICK UP Existing home sales accelerated 1.2% to an annual pace of 4.88 million in February, the National Association of Realtors announced. Sales had slowed markedly in January. February also brought a big jump in new home buying – a 7.8% increase according to the Census Bureau, taking the year-over-year gain to 24.8%.…

FED MAY WAIT LONGER TO TIGHTEN March’s Federal Reserve policy statement provided less forward guidance than many investors expected. As anticipated, the word “patient” disappeared – but the Federal Open Market Committee also lowered its 2015 GDP forecast (to a range of 2.3-2.7%) and nearly halved its 2015 inflation projection (to a range of 0.6-0.8%).…

WHERE ARE THE SHOPPERS? Retail sales were off again in February – the 0.6% decline reported by the Census Bureau was the third straight monthly retreat. Economists surveyed by Briefing.com anticipated an 0.4% advance. This severe winter may have prompted households to spend more on utilities and services than on retail purchases. Another closely watched…

GREAT JOBS REPORT MIGHT GIVE FED A SIGNAL Good news on Main Street was not so good for Wall Street. Non-farm employers added 295,000 new workers to payrolls in February, according to the Labor Department; the headline unemployment rate fell to 5.5% while the U-6 rate measuring the unemployed plus underemployed declined to 11.0%. Professional…