by Calculated Risk on 7/15/2014 12:38:00 PM

From the NY Fed: Empire State Manufacturing Survey

Business conditions improved significantly for a third consecutive month for New York manufacturers, according to the July 2014 survey. The general business conditions index advanced six points to 25.6, a four-year high. ...

Labor market conditions continued to improve. The index for number of employees climbed six points to 17.0, a level which indicated a solid increase in employment levels. The average workweek index retreated seven points to 2.3, and pointed to a slight increase in hours worked.
emphasis added

A solid report.

by Calculated Risk on 7/15/2014 10:02:00 AM

Federal Reserve Chair Janet Yellen testimony "Semiannual Monetary Policy Report to the Congress" Before the Senate Banking, Housing, and Urban Affairs Committee, Washington, D.C. (starts at 10 AM ET):

In sum, since the February Monetary Policy Report, further important progress has been made in restoring the economy to health and in strengthening the financial system. Yet too many Americans remain unemployed, inflation remains below our longer-run objective, and not all of the necessary financial reform initiatives have been completed. The Federal Reserve remains committed to employing all of its resources and tools to achieve its macroeconomic objectives and to foster a stronger and more resilient financial system.
emphasis added

Here is the C-Span Link

Here is the Bloomberg TV link.

by Calculated Risk on 7/15/2014 08:43:00 AM

On a monthly basis, retail sales increased 0.2% from May to June (seasonally adjusted), and sales were up 4.3% from June 2013. Sales in May were revised up from a 0.3% increase to a 0.5% increase. From the Census Bureau report:

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for June, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $439.9 billion, an increase of 0.2 percent from the previous month, and 4.3 percent above June 2013. ... The April to May 2014 percent change was revised from +0.3 percent to +0.5 percent.

Click on graph for larger image.

This graph shows retail sales since 1992. This is monthly retail sales and food service, seasonally adjusted (total and ex-gasoline).


Retail sales ex-autos were up 0.4%. 

The second graph shows the year-over-year change in retail sales and food service (ex-gasoline) since 1993.

Retail sales ex-gasoline increased by 4.6% on a YoY basis (4.3% for all retail sales).

The increase in June was well below consensus expectations of a 0.6% increase - however sales in April and May were revised up  (so total sales in June were actually above expectations, but the increase was below expectations due to the upward revisions to prior months).

by Calculated Risk on 7/14/2014 09:11:00 PM

It is dry in California, from CBS: California Gears Up To Vote On Water Wasting Law Tuesday

The State Water Resources Control Board is set to vote Tuesday on tough new rules that would allow any public employee empowered to enforce laws to write tickets for wasting water. ... Violations would include watering during the day, rinsing driveways and washing a car without a shut off nozzle.

Tuesday:
• At 8:30 AM ET, Retail sales for June will be released. The consensus is for retail sales to increase 0.6% in June, and to increase 0.5% ex-autos.

• Also at 8:30 AM, the NY Fed Empire Manufacturing Survey for July. The consensus is for a reading of 17.0, down from 19.3 in June (above zero is expansion).

• At 10:00 AM, Testimony by Fed Chair Janet Yellen, Semiannual Monetary Policy Report to the Congress, Before the Senate Banking, Housing, and Urban Affairs Committee, Washington, D.C.

• Also at 10:00 AM, Manufacturing and Trade: Inventories and Sales (business inventories) report for May. The consensus is for a 0.6% increase in inventories.

by Calculated Risk on 7/14/2014 06:49:00 PM

Here is another weekly update on housing inventory ...

There is a clear seasonal pattern for inventory, with the low point for inventory in late December or early January, and then usually peaking in mid-to-late summer.

The Realtor (NAR) data is monthly and released with a lag (the most recent data released was for May).  However Ben at Housing Tracker (Department of Numbers) has provided me some weekly inventory data for the last several years.

Click on graph for larger image.

This graph shows the Housing Tracker reported weekly inventory for the 54 metro areas for 2010, 2011, 2012, 2013 and 2014.

In 2011 and 2012, inventory only increased slightly early in the year and then declined significantly through the end of each year.

In 2013 (Blue), inventory increased for most of the year before declining seasonally during the holidays.  Inventory in 2013 finished up 2.7% YoY compared to 2012.

Inventory in 2014 (Red) is now 13.1% above the same week in 2013. (Note: There are differences in how the data is collected between Housing Tracker and the NAR).

Inventory is also about 0.9% above the same week in 2012. This increase in inventory should slow price increases, and might lead to price declines in some areas.

Note: One of the key questions for 2014 will be: How much will inventory increase?  My guess was inventory would be up 10% to 15% year-over-year at the end of 2014 based on the NAR report.  Right now it looks like inventory might increase more than I expected.