10 Things You Need to Know: May 31, 2023
Key data releases this week include: FHFA House Price Index (Tue), consumer confidence (Tue), JOLTS Jobs Openings (Wed), Beige Book (Wed), ISM Manufacturing (Thu), and nonfarm payrolls (Fri).
Haver
May 30, 2023
House prices rose 0.6% in March after increasing 0.7% in February, revised from 0.5%, according to the Federal Housing Finance Agency (FHFA) House Price Index. These monthly increases are the strongest since the spring of last year. The 3.6% y/y gain remained well below its high of 19.2% in February 2022. Greatly reduced y/y gains were evident throughout the country.
Haver
May 25, 2023
The Pending Home Sales Index from the National Association of Realtors (NAR) was unchanged during April (-20.3% y/y) at 78.9 following an unrevised 5.2% March decline. The index stood 38.4% below its August 2020 high of 128.0.
Haver
May 25, 2023
Real GDP grew 1.3% at an annual rate (1.6% y/y) during Q1’23 following a 2.6% Q4 rise. The figure was increased from the 1.1% gain reported in the advance report, but remained the weakest rise since negative growth during Q2’22. The latest figure compared to expectations for an unrevised 1.1% rise in the Action Economics Forecast Survey.
Haver
May 26, 2023
The PCE chain price index increased 0.4% (4.4% y/y) in April following a 0.1% gain. The core index excluding food & energy prices also rose 0.4% (4.7% y/y) after rising 0.3% in March. Goods prices rose 0.3% (2.1% y/y) following a 0.2% decline while services prices gained 0.4% (5.5% y/y) following a 0.3% rise.
Financial Times
May 25, 2023
The German economy shrank 0.3% during the first quarter, according to fresh figures from federal statistical agency Destatis, marking a downward revision from the previous estimate of zero growth. This marks the second consecutive quarter of economic contraction for the country and meets the technical definition of a recession.
Financial Times
May 24, 2023
Investors say UK gilt yields are rising to levels reminiscent of September’s “mini” budget crisis, with sparked turmoil throughout global markets. The two-year bond’s yield reached 4.4% Wednesday, edging closer to the 4.7% seen last year.
Barron’s
May 29, 2023
According to the CME FedWatch site, the probability of a quarter-point increase at the June 13-14 FOMC meeting has risen sharply to 66.5%, as of Friday, from just 17.4% just a week earlier. The probability of at least one boost at the July 25-26 meeting was 78.9%, up from less than 20% a week earlier. At the end of April, the market actually saw a 43% chance of a rate cut.
BCA Research/ Barron’s
May 29, 2023
Once the debt-ceiling soap opera ends, investors will likely turn their attention to some of the tailwinds supporting stocks. These include stronger earnings growth, diminished bank stresses, better housing data, early signs of an up-leg in the manufacturing cycle, the prospects of an AI-driven productivity boom, and slack in the labor market. Investors should resist turning bearish on stocks for now but look to become more defensive later this year.
Bloomberg
May 26, 2023
It’s taking young Americans longer to move out and get married these days. In 2021, 68% of 25-year-olds were living outside their parents’ home, 22% were married and 17% had a child, according to a Pew Research Center analysis of the most recently available Census Bureau data. In 1980, 84% were living on their own, 63% were married and 39% had a child, the report said.