Wednesday, February 24, 2010

Economic Headlines 02.24.10

· The January new home sales figures were terrible. New single-family home sales declined 11.2%m/m to a 309,000 annualized pace, a record low. With sales so low, the level of inventories actually rose for the first time since early 2007, and the months’ supply increased from 8.0 to 9.1, the highest since May 2009. Not only is the level of new home sales atrocious, but it is below the number of new single-family homes being built for sale, which we estimated at 325,000 in January. This suggests significant near-term weakness in new home construction. A Reinhart

· Bernanke HH testimony - outlook on growth was on the mixed side - says a lot of the recent improvement in eco metrics thanks to inventory restocking…..they so say private final demand is growing, but at moderate pace. On housing, they note that starts rose noticeably in the spring, but have recently turned flat and commercial construction is falling sharply. Says while labor market showing some improvement, it remains quite weak. Increases in energy prices resulted in a pickup in consumer price inflation in the second. The improvement in financial markets that began last spring continues. the FOMC continues to anticipate that economic conditions-- including low rates of resource utilization, subdued inflation trends, and stable inflation expectations--are likely to warrant exceptionally low levels of the federal funds rate for an extended period. Says the discount rate should not be interpreted as signaling any change in the outlook for monetary policy, which remains about the

same as it was at the time of the January meeting of the FOMC.

No comments:

Post a Comment