economic snapshot march 23, 2015
DESCRIPTION
The Commerce Department reported housing starts fell 17.0% in February. The Fed noted industrial production rose 0.1% in February. The second estimate of 4Q 2014 real GDP put growth at 2.2% q/q saar, under the first estimate of 2.6%.TRANSCRIPT
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Jobs
The Labor Department reported the U.S. job market added 288,000 jobs and the unemployment rate dropped to 6.1% in June from 6.3% in May. Initial jobless claims dccreased by 11,000 to 304,000. The Labor Department reported the four week sadkfasdfasdfasdfasdfasdfasdfasdfamoving average was 311,500.
Inflation
The Consumer Price Index increased 0.4% in May. The Producer Price Index had the largest increase since January 2010, closing at 0.6% in April (+2.1% y/y). Import prices decreased at a faster rate than expected, which could moderate inflation expectations goiasdfasdfasdfafdasdfasdfasdfng forward.
Rates
The yield on the 10-year U.S. Treasury note dropped. The Federal Open Market Committee announced bond purchases have dropped to $asdfasdf35 billion from $45 billion. Monthly mortgage-backed securities purchases will drop to $15 billion from $20 billion. The European Central Bank voted to keep the
Growth
The Commerce Department noted whaolesale trade increased 0.7% in May 2014. The Federal Reserve posted consumer credit increased at an annasdfasdfasdfasdfasdfasdfasdfasdfasdfasdfasdfasdfasdfasdfasdfual rate of 7.5% in May, impacted by non-revolving credit.
Profits
The second quarter earnings seasaasdfasdfaasdfasdfasfon started with the S&P 500 operating earnings on target to be $29.24, which embodies a 10.9a% year-over-year growth increase. According to S&P Dow Jones Indices divided net increases for U.S. domestic common stock increased $12.6 billion in second
The Labor Department reported initial jobless claims rose by 1,000 to 291,000 in the
week ending March 15, 2015. The four-week moving average was 304,750. The February
employment report stated nonfarm payrolls rose by 295,000 and the U.S. unemployment
rate dropped by 0.2% to 5.5%. Over the year, the unemployment rate and the number of
unemployed persons (8.7 million) dropped by 1.2% and 1.7 million in February.
Core CPI inflation was flat for the second month in a row at 1.6% year-over-year. Headline consumer prices slipped -0.7% between Dec. and Jan., and are currently down 0.2% year-over-year. Headline inflation slipped largely due to a drop in gasoline and energy prices. Final demand producer inflation dropped further in February (-0.7% year-over-year), with weakness coming from the previous 10.3% slip in energy prices. Further illustrating deflationary pressures, import prices dropped 2.5% month-over-month impacted by a stronger dollar and falling energy prices.
The 10-year U.S. Treasury Note yield dropped 0.2% to 1.93% for the week ending March
20, 2015. There were no policy changes in the FOMC’s March statement, but it opened
the opportunity for a rate increase this year by removing the word “patient.” The Fed
stressed a rate increase would only happen after more improvement in the labor market
and when the Committee had “reasonable confidence” inflation would hit 2% in the
medium term.
Economic Snapshot March 23, 2015
The Commerce Department reported housing starts fell 17.0% in February. The Fed
noted industrial production rose 0.1% in February. The second estimate of 4Q 2014 real
GDP put growth at 2.2% q/q saar, under the first estimate of 2.6%. A drop in
government spending and increasing trade deficit lowered 4Q GDP growth from 5.0%
in 3Q 2014. The US had the strongest rise in personal consumption since 1Q 2006 with
a rise of 4.2%, reflecting a rise in spending on nondurable goods and services.
According to the S&P Dow Jones Indices, as of March 12, 2015, of the 497 S&P 500
Index companies reporting 4Q earnings, 343- beat analysts’ estimates. The S&P 500
operating earnings are estimated to be $26.67 for 4Q, representing a -5.6% year-over-
year growth. Lower earnings were primarily due to low oil prices, pension write-offs
and a strong dollar.
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Jobs
Inflation
Rates
Growth
Profits
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