by Calculated Risk on 7/16/2012 10:09:00 PM

This will be a busy day for economic data, but first from Tim Duy: A Slap in The Face

The retail sales number should be a slap in the face for any FOMC members sitting on the fence. ... Note ... that the 2010 slowdown in sales did not foreshadow a recession. But it did foreshadow the Jackson Hole speech and QE2. With that in mind, I would expect Federal Reserve Chairman Ben Bernanke to acknowledge the deceleration of activity when he marches up to Capitol Hill this week. And such acknowledgement would be a signal that more easing is on its way.

• At 8:30 AM ET, the Consumer Price Index for June will be released. The consensus is for headline CPI to be unchanged in June and for core CPI to increase 0.2%.

• At 9:15 AM, the Fed will release Industrial Production and Capacity Utilization for June. The consensus is for Industrial Production to increase 0.3% in June, and for Capacity Utilization to increase to 79.2%.

• At 10:00 AM, the July NAHB homebuilder confidence survey will be released. The consensus is for a reading of 30, up slightly from 29 in June.


• Also at 10:00 AM, Fed Chairman Ben Bernanke will provide the Semiannual Monetary Policy Report to the Congress, Before the Committee on Banking, Housing, and Urban Affairs. Bernanke's comments will be analyzed closely for any comments about QE3, although he hasn't used this forum in the past to hint at further action.

For the July contest:

by Calculated Risk on 7/16/2012 07:34:00 PM

The following graphs are for inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container).

Container traffic gives us an idea about the volume of goods being exported and imported - and possibly some hints about the trade report for June. LA area ports handle about 40% of the nation's container port traffic.

To remove the strong seasonal component for inbound traffic, the first graph shows the rolling 12 month average.

Click on graph for larger image.

On a rolling 12 month basis, inbound traffic is up about 0.4%, and outbound traffic is up about 0.5% compared to May.

In general, inbound and outbound traffic has been moving sideways recently.

The 2nd graph is the monthly data (with a strong seasonal pattern for imports).

For the month of June, loaded outbound traffic was up 4.8% compared to June 2011, and loaded inbound traffic was up 6.3% compared to June 2011.

This suggests imports from Asia might be up in June, and exports to Asia up too.

All current trade graphs

by Calculated Risk on 7/16/2012 04:32:00 PM

From Alan Zibel at the WSJ: ‘Underwater’ Refis Grow; Critics Not Satisfied

The number of homeowners refinancing their mortgages under a revamped federal program grew in May, but critics are still pressing a federal regulator to do more.

For the first five months of 2012, more than 78,000 homeowners who owe more than 105% of their property’s value have refinanced using the government’s Home Affordable Refinance Program, or HARP. That was up from about 60,000 in all of 2011, the Federal Housing Finance Agency said in a report Monday.

This is a significant increase in refinance activity, but still somewhat below expectations. However the automated system wasn't released until the end of March - and there were some issues with that system - so maybe there more HARP refinances over the rest of 2012.

This table shows the number of HARP refinances by LTV through May of this year compared to all of 2011. Clearly there has been an increase in activity.

HARP Activity
	2012, Through May	All of 2011	Since Inception
Total HARP	297,103	400,024	1,318,954
LTV >80% -105%	218,830	340,033	1,150,065
LTV >105% -125%	67,155	59,991	157,771
LTV >125%	11,118	0	11,118

by Calculated Risk on 7/16/2012 01:35:00 PM

From Merrill Lynch:

Today’s weak retail sales report leaves Q2 GDP tracking a meager 1.1%. We expect the economy to remain weak through the rest of the year with growth of only 1.3% in Q3 and 1.0% in Q4. This translates to GDP growth of only 1.3% Q4/Q4, significantly below the Fed’s forecast of 1.9-2.4%.

Via Ezra Klein:

Macro advisers: Q2 GDP tracking 1%

Nouriel Roubini:

US Q2 GDP growth looks like 1.2% at best ... Q3 growth could be well below 1% given June sales report and unintended inventory build up. US at stall speed

Goldman has lowered their forecast to 1.1% for Q2.

by Calculated Risk on 7/16/2012 11:27:00 AM

This was released earlier ... from the NY Fed: Empire State Manufacturing Survey

The general business conditions index rose five points to 7.4. New orders, however, declined, as that index slipped into negative territory for the first time since November 2011, falling five points to -2.7.
...
Employment levels climbed higher, with the employment index rising six points to 18.5, while the average workweek index fell three points to zero.
...
Indexes for the six-month outlook generally remained favorable, but held at levels below those seen earlier this year. The future general business conditions index fell three points to 20.2, with 37 percent of respondents expecting improved conditions in the months ahead and 17 percent anticipating a worsening.

This was the first regional manufacturing surveys released for July. The general business conditions index was slightly better than expected although new orders were down. The employment index was the highest since March.

The Philly Fed index was especially weak in June, and the July index will be released on Thursday.