The Federal Reserve Bank of Dallas Texas Manufacturing Outlook Survey: February 2016

Today, the Federal Reserve Bank of Dallas released their latest read on manufacturing in their region indicating that assessments of manufacturing activity remained in contraction in February with the current general business activity index improving slightly to a recessionary level of -31.8 while the future general business activity index improved to a weak lecel of -2.1.

These results are an indication (consistent with other regional and national manufacturing activity data-points) that the U.S. manufacturing sector has clearly slumped into recessionary levels as of late and provides yet another likely harbinger of what is to come in 2016 for the general economy.

Pending Home Sales: January 2016

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for January showing that pending home sales declined with the seasonally adjusted national index falling a notable 2.5% from December to stand 1.4% above the level seen in January 2015.

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

GDP: Q4 2015 (Second Estimate)

Today, the Bureau of Economic Analysis (BEA) released their second "estimate" of the Q4 2015 GDP report showing that the economy grew weakly in the fourth quarter with real GDP improving at an annualized rate of 1.0% from Q3 2015.

On a year-over-year basis, real GDP increased 1.8% while the quarter-to-quarter non-annualized percent change was an increase of 0.25%.

Notable categories of weakness include, Nonresidential investment in fixed structures and equipment which declined at 1.9%, Exports of goods which declined at 5.8%, while notable categories of strength include Personal Consumption Expenditures which increased at 2.0% and residential fixed investment which increased 8.0%.

Kansas City Fed Manufacturing Survey: February 2016

The Federal Reserve Bank of Kansas City, like other district FRBs (New York, Philadelphia, Richmond and Dallas), tracks its region’s manufacturing activity by surveying a number of important indicators such as general activity, production, shipments, orders, employment and prices for raw materials and finished products.

The latest results are indicating that the assessments of manufacturing activity continued to indicate contraction falling to a level of -12 in February with ALL component measures declining on the month.

It's important to note that the current level of the Composite index is roughly equivalent to the level seen during the middle of the Great Recession seemingly indicating, yet again, that our current expansion has drawn to a close.

FHFA Monthly Home Prices: December 2015

Today, the Federal Housing Finance Agency (FHFA) released the latest results of their monthly house price index (HPI) showing that in December, nationally, home prices increased 0.45% from November rising 5.6% above the level seen in December 2014.

The FHFA monthly HPI are formulated from home purchase information collected from mortgages that have been sold to or guaranteed by Fannie Mae and Freddie Mac.

Advance Report on Durable Goods Shipments, Inventories and Orders: January 2016

Today, the U.S. Census Department released its advanced monthly Durable Goods Manufacturers’ Shipments, Inventories and Orders Report for January showing new orders for durable goods improved notably rising 4.9% from December and rising 1.75% above the level seen in January 2015.

Much of the strength came from the sub-components of new orders of non-defense aircraft parts (up 54.42) and communications equipment (up 9.6%).

Weekly Unemployment Claims: Initial and Continued February 25 2016

Today’s jobless claims report showed an increase to initial unemployment claims and a decrease to continued unemployment claims as seasonally adjusted initial claims remained below the 300K level.

Seasonally adjusted “initial” unemployment claims increased by 10,000 to 272,000 claims while seasonally adjusted “insured” claims declined by 19,000 to 2.253 million resulting in an “insured” unemployment rate of 1.7%.

New Home Sales: January 2016

Today, the U.S. Census Department released its monthly New Residential Home Sales Report for January showing sales declined a notable 9.2% from December falling 5.2% below the level seen in January 2015 and remaining near an historically low level with 494K SAAR units.

The monthly supply increased to 5.8 months while the median selling price declined 4.52% and the average selling price increased 2.72% from the year ago level.

The following chart show the extent of sales decline to date (click for full-larger version).

Reading Rates: MBA Application Survey – February 24 2016

The Mortgage Bankers Association (MBA) publishes the results of a weekly applications survey that covers roughly 50 percent of all residential mortgage originations and tracks the average interest rate for 30 year and 15 year fixed rate mortgages as well as the volume of both purchase and refinance applications.

The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage (from FHA and conforming GSE data) increased 4 basis points to 3.79% since last week while the purchase application volume increased 2% and the refinance application volume declined 8% over the same period.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages since 2006 as well as the purchase, refinance and composite loan volumes (click for larger dynamic full-screen version).

The Richmond Fed Survey of Manufacturing Activity: February 2016

Today, the Federal Reserve Bank of Richmond released their Survey of Manufacturing Activity for February showing that the composite index, the broadest measure of manufacturing activity, declined to a recessionary level of -4 from a level of 2 the prior month.

The most notable component measures also showed similar results with Shipments falling to -11, New Orders falling to -6 and Backlog of Orders falling to -14.

Existing Home Sales Report: January 2016

Today, the National Association of Realtors (NAR) released their Existing Home Sales Report for January showing increasing sales with total home sales rising 0.4% since December and climbing 11.0% above the level seen in January 2015.

Single family home sales also increased with sales climbing 1.0% from December and rising 11.2% above the level seen in January 2015 while the median selling price increased 8.3% above the level seen a year earlier.

Inventory of single family homes increased, rising 4.5% from December  to 1.62 million units, falling 3.0% below the level seen in January 2015 which, along with the sales pace, resulted in a notably tight monthly supply of 4.0 months.

The following charts (click for full-screen dynamic version) shows national existing single family home sales, median home prices, inventory and months of supply.

S&P/Case-Shiller: December 2015

Today's release of the S&P/Case-Shiller (CSI) home price indices for December reported that the non-seasonally adjusted National index increased slightly from November with prices rising 0.09% while the non-seasonally adjusted Composite-10 city index declined 0.06% and the Composite-20 city index increased 0.02% over the same period.

On an annual basis, the National index increased 5.43% above the level seen in December 2014 while the Composite-10 city index increased 5.14% and the Composite-20 city index increased 5.74% over the same period.

On a peak basis, all three indices still show significant peak declines slumping 4.86% for the National index, -12.85% for the Composite-10 city index and -11.51% for the Composite-20 city index on a peak comparison basis.

The Chicago Fed National Activity Index: January 2016

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that the national economic improved in January with the index rising to a level of 0.28 from a level of -0.34 a month earlier while the three month moving average improved to a level of -0.15.

January's improvements came as a direct result of improvements of the "Production and Income" component of the CFNAI with the latest reading rising sharply from -0.38 to 0.27 on the month.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

Measures of Stress: January 2016

Various regional Federal Reserve Banks routinely publish measures of financial stress which seek to distill many indications of financial turmoil down to convenient single "stress" data points.

As periods of financial stress come and go a whole host of fundamental economic indicators immediately adjust to meet the near and long term expectations of market participants

Interest rates, yields spreads, popular market volatility indices all move in real time giving observers unequivocal evidence of changes general sentiment.

The Federal Reserve Banks of Chicago, Kansas, St Louis and Cleveland all publish similar series which combined, offer a unique view of current financial conditions.

In January, all measures of stress appear to be on the rise with Cleveland's index, at a level of 1.52, giving the most notable indication of deteriorating conditions.

The Philly Fed Business Outlook Survey: February 2016

The February release of the Federal Reserve Bank of Philadelphia Business Outlook Survey (BOS) indicated continued weakness in the regions manufacturing activity with the current activity index improving but still remaining at a weak level of -2.8 while assessments the future activity weakened, falling to a level of 17.3.

The above chart shows the current and future activity indexes both with their corresponding 3-month moving averages. The red line marks the threshold between contraction and expansion for these diffusion indexes.

Weekly Unemployment Claims: Initial and Continued February 18 2016

Today’s jobless claims report showed a decrease to initial unemployment claims and an increase to continued unemployment claims as seasonally adjusted initial claims remained below the 300K level.

Seasonally adjusted “initial” unemployment claims declined by 7,000 to 262,000 claims while seasonally adjusted “insured” claims increased by 30,000 to 2.273 million resulting in an “insured” unemployment rate of 1.7%.

Industrial Production and Capacity Utilization: January 2016

Today, the Federal Reserve released their monthly read of industrial production and capacity utilization showing improvement in January with total industrial production increasing 0.92% since December but still declining 0.70% below the level seen in January 2015.

Capacity utilization also improved climbing 0.92% from December but still declining 2.02% below the level seen in January 2015 to stand at 77.078%.

It's important to note that industrial production is still showing significant weakness which, if all past periods were to serve at least as a rough guide, now clearly indicates notable trouble for the macro-economy.

New Residential Construction Report: January 2016

Today’s New Residential Construction Report showed weak results with total permit activity declining 0.2% since December while total starts declined a notable 3.8% over the same period.

Single family housing permits, the most leading of indicators, declined 1.6% from December to 720K single family units (SAAR), but rose 9.6% above the level seen a year earlier and still remained well below levels seen at the peak in September 2005.

Single family housing starts declined a notable 3.9% from December to 731K units (SAAR) but rose 3.5% above the level seen a year earlier but still remained well below the levels seen at the peak in September 2005.

Reading Rates: MBA Application Survey – February 17 2016

The Mortgage Bankers Association (MBA) publishes the results of a weekly applications survey that covers roughly 50 percent of all residential mortgage originations and tracks the average interest rate for 30 year and 15 year fixed rate mortgages as well as the volume of both purchase and refinance applications.

The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage (from FHA and conforming GSE data) decreased 5 basis points to 3.75% since last week while the purchase application volume declined 4% and the refinance application volume increased 16% over the same period.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages since 2006 as well as the purchase, refinance and composite loan volumes (click for larger dynamic full-screen version).

Homebuilder Blues: NAHB/Wells Fargo Home Builder Ratings January 2015

Today, the National Association of Home Builders (NAHB) released their latest Housing Market Index (HMI) showing that assessments of housing activity declined in January with the composite HMI index falling slightly to 58 from 61 the prior month while the "buyer traffic" index declined to 39.

The Empire State Manufacturing Survey: February 2016

The Empire State Manufacturing Survey consists of a series of diffusion indices distilled from a monthly survey of New York regional manufacturing executives and seeks to identify trends across 22 different current and future manufacturing related activities.

Today’s report showed a slight improvement for both current and future assessments of manufacturing activity with the current activity index rising to a still recessionary level of -16.64 while future activity rose to a weak level of 14.48.

Current prices paid declined to 2.97 while current new orders improved to a notably weak level of -11.63 while assessments of future new orders rose to 22.15.

Retail Sales: January 2016

Today, the U.S. Census Bureau released its latest nominal read of retail sales showing rising activity in January with sales climbing 0.2% from December and rising 3.4% on a year-over-year basis on an aggregate of all items including food, fuel and healthcare services.

Nominal "discretionary" retail sales including home furnishings, home garden and building materials, consumer electronics and department store sales declined 0.22% from December but rose 2.2% above the level seen in January 2015 while, adjusting for inflation, “real” discretionary retail sales declined 0.22% on the month and rose a slight 0.84% since January 2015.

SNAP Food Stamp Participation: November 2015

As a logical consequence of the prolonged weak economic conditions, participation in the federal food stamp program remains at historic levels.

The latest data released by the Department of Agriculture indicated that in November, 85,541 individual recipients were added to the food stamps program with the current total declining 1.75% on a year-over-year basis.

Individuals receiving food stamp benefits increased to 45.45 million which, as a ratio of the overall civilian non-institutional population now stands at a whopping 18.05% of the population.

Households receiving food stamps benefits increased to 22.41 million households with the current total falling 1.22% below the level seen a year earlier

Total nominal benefit cost declined 2.87% on a year-over-year basis to $5.73 billion for the month.

Weekly Unemployment Claims: Initial and Continued February 11 2016

Today’s jobless claims report showed decreases to both initial and continued unemployment claims as seasonally adjusted initial claims remained below the 300K level.

Seasonally adjusted “initial” unemployment claims declined by 16,000 to 269,000 claims while seasonally adjusted “insured” claims declined by 21,000 to 2.239 million resulting in an “insured” unemployment rate of 1.6%.

Reading Rates: MBA Application Survey – February 10 2016

The Mortgage Bankers Association (MBA) publishes the results of a weekly applications survey that covers roughly 50 percent of all residential mortgage originations and tracks the average interest rate for 30 year and 15 year fixed rate mortgages as well as the volume of both purchase and refinance applications.

The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage (from FHA and conforming GSE data) decreased 7 basis points to 3.80% since last week while the purchase application volume increased 0.2% and the refinance application volume increased 16% over the same period.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages since 2006 as well as the purchase, refinance and composite loan volumes (click for larger dynamic full-screen version).

JOLT Job Openings and Labor Turnover: December 2015

Today, the Bureau of Labor Statistics released their latest monthly read of job availability and labor turnover (JOLT) showing that private non-farm job “openings” increased 5.56% since November rising 11.76% above the level seen in December 2014 while private non-farm job “hires” rose 2.00% from November and 2.33% above the level seen in December 2014.

Quit activity, generally a mark of a strong job market for workers, also jumped notably rising 6.8% since November rising 12.5% above the level seen in December 2014.

Labor Market Conditions Index: January 2016

Today, the Federal Reserve released their latest read on Labor Market Conditions showing that conditions worsened in January with the index falling to 0.4 from December's reading of 2.3.

The Labor Market Conditions Index (LMCI) is a recent innovation by the Fed, conveniently incorporating the latest dynamics of 19 different labor market indicators into one simple series which has become a favorite economic measure for many labor market watchers, including the current Fed Chair Janet Yellen.

The chart above displays the LMCI alongside the monthly change to the Labor Department's Total Nonfarm Payrolls series (a constituent of the LMCI).

Employment Situation: Nonfarm Payrolls and Civilian Unemployment January 2016

Today's Employment Situation Report indicated that in January, net non-farm payrolls increased by a by 151,000 jobs overall with the private non-farm payrolls sub-component adding 158,000 jobs while the civilian unemployment went declined to 4.9% over the same period.

Net private sector jobs increased 0.13% since last month climbing 2.18% above the level seen a year ago and climbing 4.55% above the peak level of employment seen in December 2007 prior to the Great Recession.

Employment Situation: Unemployment Duration January 2016

Today's employment situation report showed that conditions for the long term unemployed generally worsened in January.

Workers unemployed 27 weeks or more increased to 2.089 million or 26.9% of all unemployed workers while the median term of unemployment increased to 10.9 weeks and the average stay on unemployment increased to 28.9 weeks.