by Calculated Risk on 4/24/2017 09:42:00 AM

From the Chicago Fed: Chicago Fed National Activity Index Points to Slower Economic Growth in March

Led by slower growth in employment-related indicators, the Chicago Fed National Activity Index (CFNAI) moved down to +0.08 in March from +0.27 in February. Two of the four broad categories of indicators that make up the index decreased from February, and one category made a negative contribution to the index in March. The index’s three-month moving average, CFNAI-MA3, decreased to +0.03 in March from +0.16 in February, but remained positive for the fourth consecutive month.
emphasis added

This graph shows the Chicago Fed National Activity Index (three month moving average) since 1967.

Click on graph for larger image.

This suggests economic activity was somewhat above the historical trend in March (using the three-month average).

According to the Chicago Fed:

The index is a weighted average of 85 indicators of growth in national economic activity drawn from four broad categories of data: 1) production and income; 2) employment, unemployment, and hours; 3) personal consumption and housing; and 4) sales, orders, and inventories.
...
A zero value for the monthly index has been associated with the national economy expanding at its historical trend (average) rate of growth; negative values with below-average growth (in standard deviation units); and positive values with above-average growth.

by Calculated Risk on 4/24/2017 07:00:00 AM

Note: I follow several house price indexes (Case-Shiller, CoreLogic, Black Knight, Zillow, FHFA, FNC and more). Note: Black Knight uses the current month closings only (not a three month average like Case-Shiller or a weighted average like CoreLogic), excludes short sales and REOs, and is not seasonally adjusted.

From Black Knight: Black Knight Home Price Index Report: U.S. Home Prices Hit New Peak in February, Rising 0.8 Percent for the Month, Up 5.7 Percent Year-Over-Year

• Nationally, home prices rose 0.8% for the month and gained 5.7% on a year-over-year basis

• U.S. home prices hit a new, post-crisis high in February, with the national HPI hitting $268K, surpassing the previous peak set in June 2006

• February marked 58 consecutive months of annual national home price appreciation

• Home prices in six of the nation’s 20 largest states and 14 of the 40 largest metros hit new peaks in February

The year-over-year increase in this index has been about the same for the last year.

Note that house prices are just above the bubble peak in nominal terms, but not in real terms (adjusted for inflation).  Case-Shiller for February will be released tomorrow.

by Calculated Risk on 4/23/2017 07:54:00 PM

Weekend:
• Schedule for Week of Apr 23, 2017

Monday:
• At 8:30 AM ET, Chicago Fed National Activity Index for March. This is a composite index of other data.

• At 10:30 AM, Dallas Fed Survey of Manufacturing Activity for April.

From CNBC: Pre-Market Data and Bloomberg futures: S&P futures are up 24 and DOW futures are up 187 (fair value) due to the outcome of the election in France (and early polls).

Oil prices were down over the last week with WTI futures at $49.83 per barrel and Brent at $52.27 per barrel.  A year ago, WTI was at $43, and Brent was at $44 - so oil prices are up about 15% year-over-year.

Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $2.42 per gallon - a year ago prices were at $2.14 per gallon - so gasoline prices are up about 28 cents a gallon year-over-year.

by Calculated Risk on 4/23/2017 01:01:00 PM

The automakers will report April vehicle sales on Tuesday, May 2nd.

Note: There were 26 selling days in April 2017, down from 27 in April 2016.

From WardsAuto: U.S. Forecast: Mild Sales, Growing Inventory

The report puts the seasonally adjusted annual rate of sales for the month at 17.1 million units, well above last month’s 16.5 million, but below year-ago’s 17.3 million.

The monthly volume will be 3.1% below last year. Beyond one fewer selling day, Easter occurred in April this year, unlike 2016, possibly delaying sales for some shoppers in the second half of the month. ...

Sluggish sales in March left inventory levels high, with LV stock of 4.15 million units at month-end.  The forecasted April inventory level sits at 4.16 million units, resulting in a fourth straight month above the 4 million mark. The only time this previously happened was in 2004, when five consecutive months surpassed that level. emphasis added

Looks like a decent month for vehicle sales, but overall sales are mostly moving sideways.

by Calculated Risk on 4/22/2017 08:11:00 AM

The key economic reports this week are Q1 GDP and March New Home sales.

----- Monday, Apr 24th -----
8:30 AM: Chicago Fed National Activity Index for March. This is a composite index of other data.

10:30 AM: Dallas Fed Survey of Manufacturing Activity for April.

----- Tuesday, Apr 25th-----
9:00 AM: FHFA House Price Index for February 2017. This was originally a GSE only repeat sales, however there is also an expanded index.

9:00 AM ET: S&P/Case-Shiller House Price Index for February. Although this is the February report, it is really a 3 month average of December, January and February prices.

This graph shows the nominal seasonally adjusted National Index, Composite 10 and Composite 20 indexes through the January 2017 report (the Composite 20 was started in January 2000).

The consensus is for a 5.8% year-over-year increase in the Comp 20 index for February.

10:00 AM ET: New Home Sales for March from the Census Bureau.

This graph shows New Home Sales since 1963. The dashed line is the February sales rate.

The consensus is for a decrease in sales to 584 thousand Seasonally Adjusted Annual Rate (SAAR) in March from 592 thousand in February.

10:00 AM: Richmond Fed Survey of Manufacturing Activity for April.

----- Wednesday, Apr 26th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

----- Thursday, Apr 26th -----
8:30 AM ET: The initial weekly unemployment claims report will be released. The consensus is for 243 thousand initial claims, down from 244 thousand the previous week.

8:30 AM: Durable Goods Orders for February from the Census Bureau. The consensus is for a 1.1% increase in durable goods orders.

10:00 AM: Pending Home Sales Index for March. The consensus is for a 0.4% decrease in the index.

10:00 AM: the Q1 2017 Housing Vacancies and Homeownership from the Census Bureau.

11:00 AM: the Kansas City Fed manufacturing survey for April. This is the last of the regional Fed surveys for April.

----- Friday, Apr 28th -----
8:30 AM: Gross Domestic Product, 1st quarter 2017 (Advance estimate). The consensus is that real GDP increased 1.1% annualized in Q1.

9:45 AM: Chicago Purchasing Managers Index for April. The consensus is for a reading of 56.5, down from 57.7 in March.

10:00 AM: University of Michigan's Consumer sentiment index (final for April). The consensus is for a reading of 98.0, unchanged from the preliminary reading 98.0.

by Calculated Risk on 4/21/2017 05:34:00 PM

A few comments from Steven Kopits of Princeton Energy Advisors LLC on Apr 21, 2017:

• Total US oil rigs were up 5 to 688

• US horizontal oil rigs added 9 to 581
...
• The US horizontal oil rig count is now within two weeks of the entire number necessary to cover the US contribution to incremental global oil supply.

• The market has clearly become jittery, and OPEC promises to extend production cuts are no longer comforting worried investors

Click on graph for larger image.

CR note: This graph shows the evolution of the EIA's Short-Term Energy Outlook (STEO) production forecasts by month. The production outlook keeps increasing.

Graph and comments Courtesy of Steven Kopits of Princeton Energy Advisors LLC.

by Calculated Risk on 4/21/2017 03:05:00 PM

From the BLS: Regional and State Employment and Unemployment Summary

Unemployment rates were lower in March in 17 states and stable in 33 states and the District of Columbia, the U.S. Bureau of Labor Statistics reported today. Eighteen states had jobless rate decreases from a year earlier, and 32 states and the District had little or no change. The national unemployment rate declined by 0.2 percentage point from February to 4.5 percent and was 0.5 point lower than in March 2016.
...
Colorado had the lowest unemployment rate in March, 2.6 percent, closely followed by Hawaii, 2.7 percent, and New Hampshire, North Dakota, and South Dakota, 2.8 percent each. The rates in Arkansas (3.6 percent), Colorado (2.6 percent), Maine (3.0 percent), and Oregon (3.8 percent) set new series lows. (All state series begin in 1976.) New Mexico had the highest jobless rate, 6.7 percent.
emphasis added

Click on graph for larger image.

This graph shows the current unemployment rate for each state (red), and the max during the recession (blue). All states are well below the maximum unemployment rate for the recession.

The size of the blue bar indicates the amount of improvement.   The yellow squares are the lowest unemployment rate per state since 1976.

The states are ranked by the highest current unemployment rate. New Mexico, at 6.7%, had the highest state unemployment rate.

The second graph shows the number of states (and D.C.) with unemployment rates at or above certain levels since January 2006. At the worst of the employment recession, there were 11 states with an unemployment rate at or above 11% (red).

Currently no state has an unemployment rate at or above 7% (light blue); Only two states are at or above 6% (dark blue). The states are New Mexico (6.7%), and Alaska (6.4%).

Note: The series low for Alaska is 6.3% (almost a new low in Alaska too).

by Calculated Risk on 4/21/2017 12:10:00 PM

Earlier: NAR: "Existing-Home Sales Jumped 4.4% in March"

A few key points:

1) As usual, housing economist Tom Lawler's forecast was closer to the NAR report than the consensus.  See: Lawler: Early Read on Existing Home Sales in March

"I project that US existing home sales as estimated by the National Association of Realtors ran at a seasonally adjusted annual rate of 5.74 million in March"

2) Warmer weather in February might have boosted sales for March and early April.

3) Inventory is still very low and falling year-over-year (down 6.6% year-over-year in March). More inventory would probably mean smaller price increases, and less inventory somewhat larger price increases.

I expect inventory will be increasing year-over-year by the end of 2017.

The following graph shows existing home sales Not Seasonally Adjusted (NSA).

Click on graph for larger image.

Sales NSA in March (red column) were the highest for March since 2006 (NSA).

Note that sales NSA are now in the seasonally strong period (March through September).

by Calculated Risk on 4/21/2017 10:09:00 AM

From the NAR: Existing-Home Sales Jumped 4.4% in March

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, ascended 4.4 percent to a seasonally adjusted annual rate of 5.71 million in March from a downwardly revised 5.47 million in February. March's sales pace is 5.9 percent above a year ago and surpasses January as the strongest month of sales since February 2007 (5.79 million).

Total housing inventory at the end of March increased 5.8 percent to 1.83 million existing homes available for sale, but is still 6.6 percent lower than a year ago (1.96 million) and has fallen year-over-year for 22 straight months. Unsold inventory is at a 3.8-month supply at the current sales pace (unchanged from February).
emphasis added

Click on graph for larger image.

This graph shows existing home sales, on a Seasonally Adjusted Annual Rate (SAAR) basis since 1993.

Sales in March (5.71 million SAAR) were 4.4% higher than last month, and were 5.9% above the March 2016 rate.

The second graph shows nationwide inventory for existing homes.

According to the NAR, inventory increased to 1.83 million in March from 1.75 million in February.   Headline inventory is not seasonally adjusted, and inventory usually decreases to the seasonal lows in December and January, and peaks in mid-to-late summer.

The last graph shows the year-over-year (YoY) change in reported existing home inventory and months-of-supply. Since inventory is not seasonally adjusted, it really helps to look at the YoY change. Note: Months-of-supply is based on the seasonally adjusted sales and not seasonally adjusted inventory.

Inventory decreased 6.6% year-over-year in March compared to March 2016.  

Months of supply was at 3.8 months in March.

This was above consensus expectations. For existing home sales, a key number is inventory - and inventory is still low. I'll have more later ...

by Calculated Risk on 4/21/2017 07:59:00 AM

From Black Knight: Black Knight’s First Look at March Mortgage Data: Delinquency Rate Drops to 11-Year Low; Prepayments Up 20 Percent from February’s Three-Year Low

• Delinquencies declined 14 percent month-over-month, hitting their lowest level since March 2006 and the fourth lowest point since the turn of the century

  • Total non-current inventory – all loans 30 days or more past due or in active foreclosure – fell below 2.3 million, the lowest volume in 11 years

  • After hitting a three-year low in February, prepayment speeds (historically a good indicator of refinance activity) rose 20 percent in March; still 26 percent below last year’s level

  • Foreclosure starts were up 4.15 percent for the month, but Q1 2017’s 189,000 starts represented an 18 percent decline from Q1 2016

According to Black Knight's First Look report for March, the percent of loans delinquent decreased 14.1% in March compared to February, and declined 11.4% year-over-year.

The percent of loans in the foreclosure process declined 4.6% in March and were down 29.2% over the last year.

Black Knight reported the U.S. mortgage delinquency rate (loans 30 or more days past due, but not in foreclosure) was 3.62% in March, down from 4.21% in February.

The percent of loans in the foreclosure process declined in March to 0.88%.

The number of delinquent properties, but not in foreclosure, is down 231,000 properties year-over-year, and the number of properties in the foreclosure process is down 183,000 properties year-over-year.

Black Knight: Percent Loans Delinquent and in Foreclosure Process
	Mar 2017	Feb 2017	Mar 2016	Mar 2015
Delinquent	3.62%	4.21%	4.08%	4.66%
In Foreclosure	0.88%	0.93%	1.25%	1.68%
Number of properties:
Number of properties that are delinquent, but not in foreclosure:	1,831,000	2,135,000	2,062,000	2,349,000
Number of properties in foreclosure pre-sale inventory:	448,000	470,000	631,000	846,000
Total Properties	2,279,000	2,605,000	2,693,000	3,195,000