10 Things You Need to Know: March 26, 2024
Key data releases this week include: new home sales (Mon), FHFA House Price Index (Tue), durable goods orders (Tue), consumer confidence (Tue), Q4 GDP revision (Thu), pending home sales (Thu), consumer sentiment (Thu), personal income and spending (Fri), and PCE Deflator (Fri).
Haver
March 21, 2024
The U.S. Leading Economic Index (LEI) unexpectedly ticked up 0.1% m/m in February, the first monthly gain since February 2022, following unrevised decreases of 0.4% in January and 0.2% in December, according to a report released today by The Conference Board. A 0.2% m/m February decline had been expected in the Action Economics Forecast Survey. Seven of the LEI’s ten indicators in February contributed positively to the index change.
Haver
March 21, 2024
Sales of existing homes increased 9.5% (-3.3% y/y) during February to 4.38 million (SAAR) from an unrevised 4.0 million in January, and 3.88 million in December. Sales were at the highest level since January of last year, up from the low of 3.85 million in October 2023. The Action Economics Forecast Survey expected February sales of 3.93 million units. The median price of all existing homes (NSA) was $384,500, 7.6% below the June 2022 peak of $413,800.
FT
March 21,2024
S&P Global’s flash composite purchasing managers’ index climbed to a nine-month high in March, rising to 49.9 from 49.2 the month before. The increase was ahead of expectation and marks the fifth consecutive rise, signaling Europe’s outlook is improving following a stagnant 2023.
Bloomberg
March 21, 2024
Switzerland’s central bank has cut its key rate by 25 basis points to 1.5%, the first cut for one of the world’s 10 most traded currencies since the end of the pandemic. The franc fell 1% against the euro after the announcement and 1.2% against the dollar to a four-month low.
Reuters
March 22, 2024
Japan raised interest rates for the first time in 17 years to slightly above 0%, ending its negative rate regime. This will increase the cost of borrowing, which Japanese businesses and homeowners haven’t dealt with in decades. Consumer inflation picked up again in February to 2.8% from the year before, adding to expectations rates will be hiked once more later this year.
Bloomberg
March 24, 2024
The Federal Reserve is still waiting for signs that inflation is easing enough to begin cutting interest rates, but Chair Jerome Powell has also indicated the central bank might be willing to act if it detects a surprising uptick in unemployment. This approach is “about not wanting the unemployment rate to get momentum,” says Wendy Edelberg at the Brookings Institution.
Bloomberg
March 25, 2024
Federal Reserve Bank of Atlanta President Raphael Bostic says he now projects just one interest-rate cut this year, adding that reduction will likely happen later in the year than he previously expected. Meanwhile, Federal Reserve Bank of Chicago President Austan Goolsbee said he is among policymakers anticipating three interest-rate cuts this year.
CNBC
March 17, 2024
Mentions of a potential recession are declining across corporate executives, with only 47 S&P 500 companies using the word during fourth-quarter earnings calls, the fewest since 2021 and below the five- and 10-year averages.
Capital Economics
March 22, 2024
This year is being flagged by many as the year the recovery starts in CRE, but there is still a substantial amount of pain (and value falls) to come. We think activity will gradually pick up in H2, but partly because of the increase in forced sales. That will provide appraisers with greater evidence of value falls and lead to another year of double-digit price falls. Improving NOI growth and better relative valuations will see total returns turn positive from 2025.