A robust March for retailers, but weakness remained in housing. Here are the five things we learned from U.S. economic data released during the week ending April 19.
Retailers had a good March. Retail and food services sales jumped 0.7 percent to a seasonally adjusted $709.7 billion. The Census Bureau measure has risen 4.0 percent over the past year. Sales jumped 2.1 percent at gas stations (due to higher prices) and fell 0.7 percent at auto dealers/parts stores. Net of both, core retail sales rose 1.0 percent in March and were up 4.9 percent ahead of their year-ago pace. Sales improved at retailers focused on building materials (+0.7 percent), groceries (+0.5 percent), and health/personal care (+0.4 percent). Restaurants/bars enjoyed a 0.4 percent sales gain. Falling were sales at sporting goods/hobby stores (-1.8 percent), apparel retailers (-1.6 percent), electronics/appliance stores (-1.2 percent), and furniture retailers (-0.3 percent).
Sales of previously owned homes slumped in March. The National Association of Realtors indicates existing home sales dropped 4.7 percent to a seasonally adjusted annualized rate (SAAR) of 4.190 million. Sales were 3.7 percent below year-ago levels. Sales improved in the Northeast but fell in the Midwest, South, and West. Inventories improved 4.7 percent to 1.110 million units, the equivalent to a still paltry 3.2-month supply. The median sales price of $393,500 was up 4.8 percent over the past year. The press release blames the sales drop on interest rates not making “any major moves.”
Housing starts plummeted in March. The Census Bureau estimates housing starts fell 14.7 percent to a seasonally adjusted annualized rate (SAAR) of 1.321 million. Starts were 4.3 percent below year-ago levels. Single-family and multi-family home starts slowed 12.4 percent and 20.8 percent, respectively. Looking towards the future, issued building permits fell 4.3 percent to an annualized 1.458 million. Single-family home permits fell 5.7 percent. Completions tumbled 13.5 percent to an annualized 1.469 million homes.
Forward-looking economic measures wobbled in March. The Conference Board’s Leading Economic Index (LEI) dropped 0.3 percent following February’s 0.2 percent gain to 102.4 (2016=100). The LEI has declined 2.2 percent over the past six months. Five of ten LEI components made positive contributions, led by stock prices. The Coincident Economic Index (CEI) jumped 0.3 percent to 112.0 (+0.6 percent over the past six months). All four CEI components positively contributed to the index. The Lagging Economic Index (LAG) held steady at 119.0, keeping the measure up 1.0 percent over the past six months. The Conference Board expects the U.S. economy will see “cool” growth during the latter half of 2024.
Manufacturing output grows slowly in March. The Federal Reserve reports manufacturing production grew a seasonally adjusted 0.5 percent, less than half of February’s 1.2 percent gain. Durable production increased 0.3 percent, while that of nondurables advanced 0.7 percent. Overall industrial production jumped 0.4 in March, matching February’s gain. Mining output plummeted 1.3 percent, while utilities output jumped 2.0 percent. Over the past year, manufacturing production was up a modest 0.8 percent as overall industrial production matched March 2023. Manufacturing capacity utilization of 77.4 percent was up 3/10ths of a percentage point from February but below the 79.6 percent average of the past 51 years.
Other U.S. economic data released over the past week:
- Jobless Claims (Week ending April 13, 2024, First-Time Claims, seasonally adjusted): 212,000, Unchanged vs. the previous week, -12,000 vs. the same week a year earlier). 4-week moving average: 214,500 (-3.8% vs. the same week a year earlier).
- State Employment (March 2024, Nonfarm Payrolls, seasonally adjusted): Increased in 5 states and unchanged in 45 states and the District of Columbia vs. February 2024. Increased in 31 states and unchanged in 19 states and the District of Columbia.
- Housing Market Index (April 2024, Index (>50=More Homebuilders View Housing Market As “Good” Than As “Poor,” seasonally adjusted): 51 (March 2024: 51; April 2023: 45).
- Business Inventories (February 2024, Manufacturers’ and Trade Inventories, seasonally adjusted): $2.568 trillion (+0.4% vs. January 2024; +1.0% vs. February 2023).
- Treasury International Capital Flows (February 2024, Net Foreign Purchases of U.S. Securities, not seasonally adjusted): +$145.7 billion (January 2024: +$58.6 billion; February 2023: +$160.2 billion).
- Beige Book
The opinions expressed here are not necessarily those of Kevin’s current employer. No endorsements are implied.
What We Learned About the U.S. Economy Last Week 