It’s Friday and that means it’s time to review the latest economic data and identify which pockets of the economy are heating up and which are slowing down. Don’t worry about catching every headline and every report throughout the week—I recap all of the most important news impacting your wealth right here every Friday. Let’s take a look at this week’s big headlines:
Housing Starts & Building Permits
The Commerce Department reported on Tuesday that housing starts fell more than expected in August. Housing starts slipped 5.8% last month to 1.14 million units, which missed estimates for 1.19 million units. Building permits also dropped in August, falling 0.4% to a 1.14 million unit pace. That also missed economists’ estimates for building permits to increase to a 1.17 million unit pace. While it’s disappointing that housing starts declined last month, it follows two-straight months of increases. So home construction could still support GDP growth in the third quarter.
Initial Claims for Unemployment
For the week ending September 17, jobless claims slipped to its lowest level since July. Jobless claims declined by 8,000 to 252,000, which was below economists’ estimates for 260,000. The four-week moving average also dropped, dipping by 2,250 to 258,500. Jobless claims are now just above a 40-year low of 248,000, which was set back in April.
Existing Home Sales
On Thursday morning, the National Association of Realtors reported that existing home sales fell 0.9% in August to an annual rate of 5.33 million. That’s well below economists’ estimates for an annual rate of 5.45 million. The sales pace for existing homes in July was also revised lower to 5.38 million units, down from 5.39 million units. Given the current sales pace, it would take 4.6 months to deplete inventories, which is below the six months that typically marks a balanced housing market.
Index of Leading Economic Indicators
The Conference Board’s Index of Leading Economic Indicators slipped 0.2% in August. The weak manufacturing sector was the main culprit for last month’s decline. While the index declined in August, it still increased 0.9% in the first eight months of the year. So the index is still pointing to modest economic growth in the final months of 2016.
That’s all I have for you this week; I’ll be back online on Monday morning with your weekly ratings changes.
Have a great weekend,