Commerce Department said new home sales decreased 3.4 percent to a seasonally adjusted annual rate of 560,000 units last month, which was the lowest level since December 2016. Economists polled by Reuters had forecast new home sales, which account for 9.5 percent of overall home sales, rising 3.3 percent to a pace of 588,000 units last month.New home sales, which are drawn from permits, are volatile on a month-to-month basis. Sales were down 1.2 percent on a year-on-year basis in August. The Commerce Department suggested Harvey and Irma likely impacted new home sales data last month.
Wednesday was marked by Durable Goods Orders and Pending Home Sales figures. New orders for manufactured durable goods in August increased $3.9 billion or 1.7 percent to $232.8 billion, the U.S. Census Bureau announced today. This increase, up two of the last three months, followed a 6.8 percent July decrease. Excluding transportation, new orders increased 0.2 percent. Excluding defense, new orders increased 2.2 percent. Transportation equipment, also up two of the last three months, led the increase, $3.6 billion or 4.9 percent to $77.4 billion.
The Pending Home Sales Index, a forward-looking indicator based on contract signings, retreated 2.6 percent to 106.3 in August from 109.1 in July. The index is now at its lowest reading since January 2016 (106.1), is 2.6 percent below a year ago, and has fallen on an annual basis in four of the past five months. Lawrence Yun, NAR chief economist, says this summer’s terribly low supply levels have officially drained all of the housing market’s momentum over the past year.
Thursday brought US GDP and Unemployment Claims figures. Real gross domestic product (GDP) increased at an annual rate of 3.1 percent in the second quarter of 2017, according to the "third" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 1.2 percent.Real gross domestic income (GDI) increased 2.9 percent in the second quarter, compared with an increase of 2.7 percent in the first. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased 3.0 percent in the second quarter, compared with an increase of 2.0 percent in the first quarter.
In the week ending September 23, the advance figure for seasonally adjusted initial claims was 272,000, an increase of 12,000 from the previous week's revised level. The 4-week moving average was 277,750, an increase of 9,000 from the previous week's unrevised average of 268,750. This is the highest level for this average since February 6, 2016 when it was 277,750. Hurricanes Harvey and Irma impacted this week's claims.
On Friday Revised Consumer Sentiment data was released. The consumer sentiment index, a survey of consumers by The University of Michigan, hit 95.1 in September in a final reading Friday, which was lower than expected. Economists polled by Reuters anticipated a reading of 95.3 for the month. In August the index returned to near peak levels recorded earlier in 2017, hitting 96.8 in the final recording in August. "The resilience of consumers has again been demonstrated as concerns about the impact of the hurricanes on the national economy have quickly faded," Richard Curtin, chief economist for the Surveys of Consumers, said in a statement on Friday.
This week markets will be looking at:
ISM Manufacturing PMI (Monday 16:00)
ADP Employment Change (Wednesday 14:15)
ISM Non-Manufacturing PMI (Wednesday 16:00)
Unemployment Claims (Thursday 14:30)
Non-Farm Payrolls/Unemployment Rate (Friday 14:30)
