Economic activity showed strength as 2023 was ending. Here are the five things we learned from U.S. economic data released during the week ending December 29.
Economic growth accelerated in November. The Chicago Fed National Activity Index (CFNAI) surged 69 basis points to +0.03. The index, based on 85 economic measures and indexed such that a zero reading indicates the U.S. economy was expanding at its historical rate, had plummeted by 68 basis points in October. Forty-three of the 85 economic measures made positive contributions to the index, while 41 made negative contributions. The remaining measure had a neutral impact on the CFNAI. Among the four categories of index components, those associated with employment and personal consumption/housing made positive contributions. Weighing on the CFNAI were measures tied to production and sales/orders/inventories. The CFNAI’s three-month moving average improved by six basis points to -0.20 (indicative of below-average economic growth).
Jobless claims stayed near their 2023 average in late December. The Department of Labor reports that there were a seasonally adjusted 218,000 first-time claims made for unemployment insurance benefits during the week ending December 23. This was up 12,000 from the prior week and 5,000 from the same week a year ago. The four-week moving average in first-time claims of 212,000 essentially matched the moving average this time last year. 1.864 million people received some form of unemployment insurance benefits during the week ending December 9, 15.0 percent above the year-ago count.
Homebuyers signed purchase contracts at the same pace in November as they had in October. The National Association of Realtors’ Pending Home Sales Index (PHSI) came in at 71.6 (2001=100), matching its October reading. The index improved in the Northeast and Midwest but declined in the South and West. The PHSI was off 5.2 percent from November 2022 and below its year-ago marks in all four Census regions. The press release stated that the recent decrease in mortgage rates did not “induce more homebuyers to submit formal contracts” but had increased traffic of potential buyers.
Home prices grew again in October, according to one measure… The Federal Housing Finance Administration’s (FHFA) purchase-only House Price Index grew a seasonally adjusted 0.3 percent after rising 0.7 percent in September. The index, which tracks purchases made with conforming mortgages, was up 6.3 percent from a year earlier. Prices advanced in five of nine Census regions, including in the East South Central (+1.0 percent) and East North Central (+0.8 percent). Prices eased in New England (-0.3 percent) and the Mountain region (0.2 percent). The greatest year-to-year price gains were in the Middle Atlantic (+9.9 percent) and East North Central (+9.1 percent).
…As they had with another measure. The national S&P Case-Shiller Home Price Index increased 0.7 percent on a seasonally adjusted basis in October. The same measure grew 0.6 percent in September and has risen 4.8 percent over the past year. All 20 tracked metropolitan areas saw prices rise in October, with gains above one percent in Detroit, Las Vegas, Los Angeles, Miami, Phoenix, and San Francisco. Prices declined in Portland, OR. The press release notes that the recent decline in mortgage rates may lead to “more appreciation” in home prices.
Other U.S. economic data released over the past week:
- Agricultural Prices (November 2023, Prices Received By Farmers, not seasonally adjusted): -0.1% vs. October 2023; -14.5% vs. November 2022.
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What We Learned About the U.S. Economy Last Week 