The housing market took center stage this week. The week began with an eye-catching plunge in home builder sentiment. July's NAHB Housing Market Index dropped 12 points to 55, the second largest monthly decline on record behind April 2020's pandemic-induced collapse. There was not a bright spot to be found in the underlying details, with measures of buyer traffic and single-family sales, both present and future, posting substantial declines. For most of the past two years, home builders have been navigating a rising cost environment, namely for building materials, labor and land. However, the straw that breaks the back of builder sentiment now appears to be higher financing costs. According to Freddie Mac, the average 30-year mortgage was 5.54% during the week ended July 21, a jump from the 3.22% averaged during the first week of 2022.
The downturn in home builder confidence provided an early clue that June's data for new home production would surprise to the downside. Total housing starts declined 2.0% to a 1.559 million-unit pace during June, below consensus estimates for a modest increase following May's sharp contraction. Single-family starts dropped 8.1%, the fourth consecutive monthly decline. Single-family starts are now running at a 982,000-unit pace, which is a bit higher than the sluggish pace registered for much of the decade predating the pandemic, but still the slowest since June 2020. The sharp rise in borrowing costs is clearly leading home builders to scale back production plans, with single-family permits recently taking a downward trajectory. Single-family permits dropped 8% in June, the fourth consecutive drop.
This Week's State Of The Economy - What Is Ahead? - 18 October 2019
Wells Fargo Economics & Financial Report / Oct 19, 2019
Personal consumption is still on track for a solid Q3, but retail sales declined in September for the first time in seven months.
This Week's State Of The Economy - What Is Ahead? - 04 August 2023
Wells Fargo Economics & Financial Report / Aug 09, 2023
Employment growth was broad-based, though reliant on a 87K gain in health care & social assistance. Modest gains from construction, financial activities and hospitality also contributed to private sector job growth.
This Week's State Of The Economy - What Is Ahead? - 11 December 2020
Wells Fargo Economics & Financial Report / Dec 14, 2020
Emergency authorization of the Pfizer-BioNTech COVID vaccine appears imminent, but the virus is running rampant across the United States today, pointing to a grim winter.
This Week's State Of The Economy - What Is Ahead? - 19 June 2020
Wells Fargo Economics & Financial Report / Jun 22, 2020
Retail sales kicked off the week with a bang, rising 17.7% month-over-month in May. The increase was larger than every single one of the 74 forecast submissions.
This Week's State Of The Economy - What Is Ahead? - 30 April 2021
Wells Fargo Economics & Financial Report / May 18, 2021
The gain in output leaves the level of real GDP just a stone\'s throw below its pre-COVID Q4-2019 level (see chart).
This Week's State Of The Economy - What Is Ahead? - 02 December 2022
Wells Fargo Economics & Financial Report / Dec 08, 2022
Total payrolls rose by 263K in November, with the unemployment rate holding steady at 3.7% and average hourly earning rising by 0.6%.
This Week's State Of The Economy - What Is Ahead? - 20 December 2019
Wells Fargo Economics & Financial Report / Dec 21, 2019
President Trump became the third president in U.S. history to be impeached by the House, but removal by the Senate is highly unlikely. The House also passed the USMCA, which should be signed into law in early 2020.
May 2020 Economy at a Glance
Wells Fargo Economics & Financial Report / May 19, 2020
The U.S. is in a severe recession caused by the sudden shutdown due to the COVID-19 pandemic. Since the lock down began, the nation has lost 21.4 million jobs.
This Week's State Of The Economy - What Is Ahead? - 4 October 2019
Wells Fargo Economics & Financial Report / Oct 05, 2019
Survey evidence flashed signs of contraction in the manufacturing sector and indicated weakness spreading to the services side of the economy, while employers added a less-than-expected 136K jobs in September.
This Week's State Of The Economy - What Is Ahead? - 12 June 2020
Wells Fargo Economics & Financial Report / Jun 13, 2020
Lock downs began to be lifted across most of the country by the end of May and the total amount of daily new coronavirus cases has been trending lower. But the flattening case count has not been consistent across the country.
