Economic Reports Week Ending 01/17/09
MBA Home Purchases... Steeply lower interest rates, now at 4.89% for 30-year fixed, are giving a boost to refinancing activity but are doing little for home purchasing.
MBA's purchase applications index fell sharply in the Jan. 9 week to 295.8 but the refinancing index rose even more sharply to 7,414.1.
Weak purchasing interest, a function of the weak jobs markets, is pointing to still bloated supply and continued pressure on prices.
Rampant Foreclosures... Despite Freddie & Fannie moratoriums and state legislation to slow the process...
Realtytrac reported foreclosure filings on 303,410 U.S. properties in December, up 17% from the previous month and up nearly 41% from December 2007.
Default notices, auction sale notices and bank repossessions - were reported on 2,330,483 U.S. properties during the year,
an 81% increase in total properties from 2007 and a 225% increase in total properties from 2006.
TIC Foreign Flows... Investors and institutions repatriated funds in November, leading to a net outflow of $21.7 billion in long-term U.S. securities.
Of the $56.0 billion in foreign outflow, official institutions sold a net $37.1 billion of U.S. assets with private investors selling $18.9 billion.
There is good news in this report as China continued to expand its holding of U.S. Treasuries, up nearly $30 billion in November.
Chinese holdings are at $681.9 billion with Japanese holdings, which slipped slightly in the month, at $577.1 billion.
Japanese machine orders... an indicator of capital spending in the next three to six months...
decreased 16.2% in November from the previous month, the Cabinet Office said today, the biggest decline since the current survey began in 1987.
Trade Balance... In November, exports posted a 5.8% drop while imports plunged a monthly 12%.
Year-on-year, overall exports fell to down 1.7% in November from up 5.2% in October while imports dropped to down 10.6% from up 3.9% the prior month.
The November decline in exports of goods was seen in all major end-use categories but was led by...
a $4.2 billion fall in industrial supplies and $1.5 billion decrease for non-auto capital goods.
Industrial Production.... Output at US factories, mines and utilities dropped 2% in December...
after a revised decline of 1.3% in November that was more than double the previously reported decrease.
A key part of manufacturing weakness was in motor vehicle assemblies which dropped to 6.64 million units in December from 7.60 million in November - a 12.6% fall.
Durables output -2.6% in while nondurables -2.1%. Not much is supporting economic growth...
and more sectors are pulling growth down further as manufacturing and housing are both very negative.
A record slide in retail sales destroyed companies’ pricing power and idled more than a quarter of factory capacity.
Plant use matched the lowest level since 1983 as the capacity-utilization rate slid to 73.6%.
U.S. retail sales... dropped for a sixth month with a -2.7% slump in December vs -2.1% in November...
the longest stretch of declines since the tallies began in 1992. Ex motor vehicles, retail sales decreased -3.1%, after retreating -2.5% in November.
Overall retail sales on a year-on-year basis in December were down 9.8% - compared to down 8.2% in November
Business Inventories... destocking continues. Inventories fell 0.7% in November...
but this is overshadowed by the 5.1% plunge in sales. October was the same story with inventories down 0.6% but with sales down 3.9%.
CPI & PPI... -1.9%, following a -2.2% drop in November. The core PPI rate +0.2% after edging up +0.1% in November.
CPI fell for the fifth month in a row. The headline CPI fell 0.7% in December.
The latest CPI report shows weak demand pulling down oil and gasoline prices and even spreading to core prices.
Apparel -0.9%, reflecting discounting by retailers to move merchandise over the holidays.
New and used vehicles -0.4%. Lodging away from home -0.7% as consumers are not traveling much.
Empire State Index... less severe contraction as general business conditions index improved to -22.2 vs. December's -27.9.
However, shipments actually contracted more deeply at -13.1 vs. -11.3. Worse yet...
The 6-month outlook suddenly and dramatically lurched into the negative column, at -4.0 for the overall index vs. 18.1 in December.
Philly Fed... shows steep contraction in January but still less severe contraction than December. -24.3, up from an upwardly revised -36.1 in December.
One area unfortunately where contraction is deepening is employment...
where the number of employees index fell more than 10 points to -39.0 -- the single worst reading in the report.
Initial claims... rose 54K in the Jan. 10 week to 524K vs. 470K; 4 week MA fell 8K to 518.5K.
Continuing claims for the Jan. 3 week fell 115K to 4.497 million.
MBA's purchase applications index fell sharply in the Jan. 9 week to 295.8 but the refinancing index rose even more sharply to 7,414.1.
Weak purchasing interest, a function of the weak jobs markets, is pointing to still bloated supply and continued pressure on prices.
Rampant Foreclosures... Despite Freddie & Fannie moratoriums and state legislation to slow the process...
Realtytrac reported foreclosure filings on 303,410 U.S. properties in December, up 17% from the previous month and up nearly 41% from December 2007.
Default notices, auction sale notices and bank repossessions - were reported on 2,330,483 U.S. properties during the year,
an 81% increase in total properties from 2007 and a 225% increase in total properties from 2006.
TIC Foreign Flows... Investors and institutions repatriated funds in November, leading to a net outflow of $21.7 billion in long-term U.S. securities.
Of the $56.0 billion in foreign outflow, official institutions sold a net $37.1 billion of U.S. assets with private investors selling $18.9 billion.
There is good news in this report as China continued to expand its holding of U.S. Treasuries, up nearly $30 billion in November.
Chinese holdings are at $681.9 billion with Japanese holdings, which slipped slightly in the month, at $577.1 billion.
Japanese machine orders... an indicator of capital spending in the next three to six months...
decreased 16.2% in November from the previous month, the Cabinet Office said today, the biggest decline since the current survey began in 1987.
Trade Balance... In November, exports posted a 5.8% drop while imports plunged a monthly 12%.
Year-on-year, overall exports fell to down 1.7% in November from up 5.2% in October while imports dropped to down 10.6% from up 3.9% the prior month.
The November decline in exports of goods was seen in all major end-use categories but was led by...
a $4.2 billion fall in industrial supplies and $1.5 billion decrease for non-auto capital goods.
Industrial Production.... Output at US factories, mines and utilities dropped 2% in December...
after a revised decline of 1.3% in November that was more than double the previously reported decrease.
A key part of manufacturing weakness was in motor vehicle assemblies which dropped to 6.64 million units in December from 7.60 million in November - a 12.6% fall.
Durables output -2.6% in while nondurables -2.1%. Not much is supporting economic growth...
and more sectors are pulling growth down further as manufacturing and housing are both very negative.
A record slide in retail sales destroyed companies’ pricing power and idled more than a quarter of factory capacity.
Plant use matched the lowest level since 1983 as the capacity-utilization rate slid to 73.6%.
U.S. retail sales... dropped for a sixth month with a -2.7% slump in December vs -2.1% in November...
the longest stretch of declines since the tallies began in 1992. Ex motor vehicles, retail sales decreased -3.1%, after retreating -2.5% in November.
Overall retail sales on a year-on-year basis in December were down 9.8% - compared to down 8.2% in November
Business Inventories... destocking continues. Inventories fell 0.7% in November...
but this is overshadowed by the 5.1% plunge in sales. October was the same story with inventories down 0.6% but with sales down 3.9%.
CPI & PPI... -1.9%, following a -2.2% drop in November. The core PPI rate +0.2% after edging up +0.1% in November.
CPI fell for the fifth month in a row. The headline CPI fell 0.7% in December.
The latest CPI report shows weak demand pulling down oil and gasoline prices and even spreading to core prices.
Apparel -0.9%, reflecting discounting by retailers to move merchandise over the holidays.
New and used vehicles -0.4%. Lodging away from home -0.7% as consumers are not traveling much.
Empire State Index... less severe contraction as general business conditions index improved to -22.2 vs. December's -27.9.
However, shipments actually contracted more deeply at -13.1 vs. -11.3. Worse yet...
The 6-month outlook suddenly and dramatically lurched into the negative column, at -4.0 for the overall index vs. 18.1 in December.
Philly Fed... shows steep contraction in January but still less severe contraction than December. -24.3, up from an upwardly revised -36.1 in December.
One area unfortunately where contraction is deepening is employment...
where the number of employees index fell more than 10 points to -39.0 -- the single worst reading in the report.
Initial claims... rose 54K in the Jan. 10 week to 524K vs. 470K; 4 week MA fell 8K to 518.5K.
Continuing claims for the Jan. 3 week fell 115K to 4.497 million.
Comments