Category Archives: U.S. Economic News

[09/24/14]  New-home sales in the U.S. surged in August to the highest level in more than six years, a sign that the housing recovery is making progress. Purchases of new houses jumped 18 percent to a 504,000 annualized pace, the strongest since May 2008 and surpassing the highest forecast in a Bloomberg survey of economists, Commerce Department figures showed today in Washington. The one-month increase was the biggest since January 1992. The housing market is improving in fits and starts this year amid slow wage growth and tight credit conditions. Sustained improvement in the job market will be needed to push up pay and sustain a stronger recovery. “Sales...

[09/19/14]  The net worth of American households is now 20 percent higher than it was before it began to decline in 2007, the Federal Reserve reported this week. It said the households together were worth $81.5 trillion at the end of the second quarter, higher than ever and up 10 percent from a year earlier.

By another measure, household net worth is a little short of the record highs reached before the recession. It amounted to 471 percent of the nation’s gross domestic product in the second quarter, just short of the record 473 percent set in early 2007.

Those figures...

[09/15/14]  For Janet L. Yellen, the Federal Reserve’s chairwoman, the easy part is over. The first phase of the Fed’s retreat from its economic stimulus campaign, plotted by her predecessor, is nearly complete. Now, as Ms. Yellen nears the end of her first year in office, it is her turn to chart the way forward.

Ms. Yellen and her colleagues on the Fed’s policy-making committee, who will convene here on Tuesday and Wednesday, are broadly agreed that the Fed’s ability to improve economic conditions is nearing the end of the line, and they are inclined to start raising short-term interest rates around...

[09-04-14]  Service providers such as retailers and construction firms expanded in August at the fastest pace in nine years, pointing to greater momentum in the economy that’s generating jobs and brightening Americans’ spirits. The Institute for Supply Management’s non-manufacturing index climbed to 59.6, the highest since August 2005, from 58.7 a month earlier, the Tempe, Arizona-based group said today. Bloomberg’s weekly measure of consumer sentiment rose to the second-highest level in a year and filings for unemployment benefits were little changed, other figures showed. The improvement at service providers was broad-based and, combined with faster manufacturing growth, raises the odds of a self-supporting cycle of more spending and...

[09-04-14]  The economy strengthened in all regions of the country in July and August, including in areas like consumer spending, auto sales and tourism, the Federal Reserve reported in a survey released on Wednesday.

A separate report from the Commerce Department showed that business orders for factory goods shot up by a record amount in July, reflecting a surge in demand in the volatile category of commercial aircraft. But outside of transportation, orders actually fell slightly during the month, although the setback was expected to be temporary.

The Fed said all 12 of its regions reported growth. Six — New York, Cleveland, Chicago,...

[09-04-14]  It's been a good summer for jobs. Private employers added 204,000 new workers in August, payroll processing firm ADP said Thursday. That marks the fifth straight month of companies adding at least 200,000 new hires to their payrolls. To put it another way, over one million jobs have been added in the private sector since April. "Steady as she goes in the job market," said Mark Zandi, chief economist of Moody's Analytics. The especially encouraging news is that businesses of all sizes and across all industries are hiring. Jobs that pay middle wages, such as in government or manufacturing, are also on the rise now, Zandi said. Job gains...

[08-29-14]  Consumer spending fell in July for the first time in six months, but a measure of confidence among households hit a seven-year high in August, suggesting the retrenchment would be temporary.

A third report on Friday showed a sharp acceleration in factory activity in the Midwest this month, a further sign that the economy remains on solid ground.

“The weakness in spending will quickly subside this fall” as momentum builds from promising signs like the surging stock market, rising home prices and an improving job market, said Michael Woolfolk, global markets strategist at BNY Mellon in New York.

Consumer...

[08/28/14]  The United States economy grew faster than first thought last quarter, the Commerce Department said on Thursday, the latest in a series of signals that point to a period of sustainable growth ahead. Increased investment by businesses and a slightly improved trade picture prompted the revision, which lifted the estimated annual rate of growth in April, May and June to 4.2 percent, up from the government’s initial reading of 4 percent in late July. Since the economy emerged from the recession five years ago, companies have been hesitant to spend heavily on new capacity, but these figures and other recent data indicate that is finally changing. “Not only...

[08-20-14]  An increasingly vocal minority of Federal Reserve officials want the central bank to retreat more quickly from its stimulus campaign, arguing that the bank has largely exhausted its ability to improve economic conditions.

The debate, reflected in an account of the Fed’s most recent policy-making meeting published on Wednesday, is likely to dominate the gathering of central bankers and economists at Jackson Hole, Wyo., Thursday through Saturday.

Fed officials are convinced that the economy is gaining strength after the years of false starts, but a majority of policy makers, led by the chairwoman, Janet L. Yellen, favors a slow retreat...

[06/14/14]  Wholesale prices fell for the first time in three months, indicating inflation remains low. The government's producer price index, which measures the cost of goods and services before they reach consumers, fell 0.2% in May, the Labor Department said. Economists had forecast a rise of 0.1%, according to Action Economics' median forecast. The report suggests "producer price inflation is still fairly contained despite the big increases in the last few months," said RBS Securities' economist Omair Sharif in a research note. Last month's decline followed a rise of 0.6% in April and 0.5% in March. Prices fell 0.2% in February. The index shows a 2% increase in inflation at the...