Economic Reports 07/31/07

Summary: Confidence rises on lower gasoline prices, not an increase in optimism.

PCE Inflation rising slowly with income, but spending is decelerating. Chicago PMI declining as production & orders "drop like a rock".

The housing debacle continues... private residential construction spending still plunging. Case Schiller Home Price Index shows largest decline in 7 years.

Consumer Confidence Jul 112.6 vs 105.3
Full Report

Inside the number: the highest since 09/11. Present Situation up to 139.2 vs 129.9; Expectations up to 94.8 vs 88.8.

"Consumers are more upbeat about short-term economic prospects, mainly the result of a decline in the number of pessimists, not an increase in the number of optimists."

Core PCE Inflation Index Jun +0.1% vs prior +0.1%
Full Report

Personal Income Jun +0.4% vs prior +0.4%; Personal Spending Jun +0.1% vs prior +0.6%.

Excepting services a deceleration in Current $ PCE: +0.1% vs prior +0.6%;

durable goods -1.6% vs prior +1.6%; non durable FLAT vs prior +1.4%; services +0.5% vs prior +0.1%

Good news... In chained 2000 dollars: Real Disposable Income +0.3% vs prior -0.1% & the bad news...

Excepting services a deceleration in Chained $ PCE: FLAT vs prior +0.2%;

durable goods -1.6% vs prior +1.7%; non durable goods FLAT vs prior +0.2%; services +0.2% vs prior -0.1%

Chicago PMI Jul 53.4 vs prior 60.2
Full Report

Inside the number: greater than 12 point decline, new orders down 53.4 vs 65.7; 2 months of contraction, production down 59.0 vs 66.5; dropping like a rock, order backlogs down 37.4 vs 50.8.

Inflation spreading, Prices paid 73.1 vs 68.1; good news? expanding 9 points, employment up 61.6 vs 52.7.

Construction Spending Jun -0.3% vs prior +1.1%
Full Report

Inside the number: Private residential projects -0.7% the 16th consecutive decline; YOY -16.4%. New single family homes -1.4%; YOY -25.8%.

Case Schiller Home Price Index -2.8%
Full Report

Inside the number: 18th consecutive decline and the biggest decline in the 7 year history of the 20 city index.

Home prices in 10 major U.S. cities have fallen 3.4% in the past year, the biggest decline since 1991.

Robert J. Shiller, Chief Economist at MacroMarkets:

"Year-over-year price returns are continuing to either move deeper into negative territory or experience persistent diminishing returns."

Comments