Current-Cast® Report

·      December existing home sales decreased 4.6% to an annualized rate of 4.99 million units, according to the National Association of Realtors. The December figure was 10.3 % below the December 2017 figure. The median sales price of existing houses sold was $253.6 thousand, 2.9% above December 2017. This marks the 82^nd straight month of year-over-year gains in prices. The housing inventory at the end of December dropped to 1.55 million from 1.74 million existing homes for sale in November. Unsold inventory is at a 3.7-month supply at the current sales pace, down from 3.9 last month and up from 3.2 months a year ago.

·      U.S. House prices rose 0.4% on a seasonally adjusted basis from October to November, the same increase as in the previous period, according to the Federal Housing Finance Agency’s (FHFA) monthly House Price Index. For the 12 months ending in November, U.S. prices rose 5.8%. The annual increases ranged from 4.5% in the West South Central division to 7.4% in the Mountain division.

·      The results of Freddie Mac’s Primary Mortgage Market Survey showed 30-year fixed mortgage rates remained unchanged for the third consecutive week. The 30-year fixed mortgage rate averaged 4.45% for the week ending January 24, unchanged from last week. A year ago at this time, the 30-year fixed-rate averaged 4.15%. The 15-year fixed mortgage rate averaged 3.88%, unchanged from last week. A year ago at this time, the 15-year fixed-rate averaged 3.62%.

·      Mortgage applications decreased 2.7% from a week earlier week, according to data from Mortgage Bankers Association’s (MBA) Weekly Applications Survey for the week ending January 18, 2019.

·      The advance figure for initial claims for unemployment insurance decreased by 13 thousand to 199 thousand in the week ending January 19. This is the lowest level for initial claims since November 15, 1969 when it was 197 thousand. The 4-week moving average was 215 thousand, a decrease of 5.5 thousand from the previous week’s revised average. The advance number for seasonally adjusted insured unemployment (ongoing) during the week ending January 12 was 1,713 thousand, a decrease of 24 thousand from the previous week’s unrevised level of 1,737 thousand. The 4-week moving average was 1,729.750 thousand, an increase of 1.25 thousand from the previous week’s unrevised average of 1,728.5 thousand. 

·      The Conference Board index of leading economic indicators decreased 0.1% in December, following a 0.2% increase in the previous month. Over the last six months of 2018, the index grew 1.5% (about 3.1% annual rate), slower than the growth of 2.7% (about 5.5% annual rate) over the first half of the year.The Conference Board coincident economic index increased 0.2% in December, the same increase as in November. The coincident index rose 1.2% (about 2.3% annual rate) during the last six months of 2018, slower than the growth of 1.0% (about 2.0% annual rate) over the first half of the year.

• Total Industrial production increased 0.3% in December, following a 0.4% increase in the previous month. The index was 4.0% above the level in December 2017. The manufacturing index was up 1.1% in December, while the index for utilities was down 6.3%. The index for mining was up 1.5% in December. Total Industrial production for the year 2018 was up 4.1% from the previous year.
• The rate of capacity utilization for total industry was 78.7% in December, compared with 78.6 in November, and 79.8 as the average of the 1972-2017 period.
• Unemployment rates were higher in December in 4 states, lower in 3 states, and stable in 43 states and the District of Columbia, according to the U.S. Bureau of Labor Statistics. Fourteen states had jobless rate decreases from a year earlier and 36 states and the District had little or no change. Nonfarm payroll employment increased in 8 states in December 2018 and was essentially unchanged in 42 states and the District of Columbia. Over the year, 40 states added nonfarm payroll jobs and 10 states and the District were essentially unchanged.
• Median weekly earnings of the nation’s 115.9 million full-time wage and salary workers were $900 in the fourth quarter of 2018 (not seasonally adjusted), according to the U.S. Bureau of Labor Statistics. This was 5.0% higher than a year earlier, compared with a gain of 2.2% in the Consumer Price Index for All Urban Consumers over the same period.  Women had median weekly earnings of $794, or 80.0 percent of the $993 median for men.
• The advance figure for initial claims for unemployment insurance decreased 3 thousand to 213 thousand in the week ending January 12. The 4-week moving average was 220.75 thousand, a decrease of a thousand from the previous week’s average.
• The producer price index for final demand (headline index) decreased 0.2% in December, following a 0.1% increase in the previous month, according to the U.S. Bureau of Labor Statistics. The index for final demand less foods, energy and trade held steady in December, after a 0.3% increase in the previous month. The headline index increased 2.5% from December 2017 to December 2018, while the index for final demand less foods, energy and trade increased 2.8%.
• The import price index in December was down 1.0% from November, and was down 0.6% from December of 2017. The export price index was down 0.6% from November, but was up 1.1% from December of 2017.
• The results of Freddie Mac’s Primary Mortgage Market Survey of January 17th showed average fixed mortgage rates remained flat after dropping for six consecutive weeks. 30-year fixed rate mortgage averaged 4.45% for the week ending January 17^th, unchanged from last week. A year ago at this time, the 30-year fixed rate averaged 4.04%. 15-year fixed rate mortgage averaged 3.88%, down slightly from last week when it averaged 3.89%. A year ago at this time, the 15-year fixed rate averaged 3.49%.
• Mortgage applications increased 13.5% from a week earlier, according to data from Mortgage Bankers Association’s (MBA) Weekly Applications Survey for the week ending January 11th.
• The January 2019 Empire State Manufacturing Survey indicated that business activity grew slightly in New York State. The headline general business conditions index fell eight points to 3.9, its lowest level in well over a year. The prices paid index decreased 3.8 points, while the prices received index inched up 0.3 point. Looking ahead, firms were less optimistic about the six-month outlook than they were last month.
• The Philadelphia FED’s manufacturing business outlook survey for January 2019 reported that economic growth continued in the region. The index for current manufacturing activity increased from 9.1 in December to 17.0 in January. The prices paid index decreased 6 points, while the prices received index decreased 4 points in January.
• The Thomson Reuters/University of Michigan Index of Consumer Sentiment, preliminary, decreased to 90.7 in January, from 98.3 in December. The Index was 95.7 a year ago. The Current Economic Conditions Index decreased from 116.1 to 110.0, while the Index of Consumer Expectations decreased from 87.0 to 78.3.
• The FED’s “Beige Book” indicated that economic activity increased in most of the Districts. The majority of Districts indicated that manufacturing activity slowed down, while new home construction, existing home sales, and commercial real estate activity were little changed. Many Districts were less optimistic in response to increased financial market volatility, rising short-term interest rates, falling energy prices, and elevated trade and political uncertainty. Districts highlighted rising entry-level wages as firms sought to attract and retain workers and as new minimum wage laws came into effect. Most Districts indicated that firms’ input costs had risen, but reports were mixed on whether they could pass the higher costs on to customers.

• The consumer price index (headline index) decreased 0.1% in December, after holding steady in the previous month. The core index, all items less food and energy, increased 0.2%, the same increase as in the previous month. The consumer price index increased 1.9% for the 12-month period ending in December, while the core index rose 2.2%.
• Real average hourly earnings for all employees increased 0.5% from November to December. This result stems from a 0.4% increase in average hourly earnings combined with a 0.1% decrease in the consumer price index for all urban consumers.
• The advance figure for initial claims for unemployment insurance decreased by 17 thousand to 216 thousand in the week ending January 5. The 4-week moving average was 221.75 thousand, an increase of 2.5 thousand from the previous week’s revised average.
• The number of job openings decreased to 6.9 million on the last business day of November, according to the U.S. Bureau of Labor Statistics. Over the month, hires edged down to 5.7 million and separations were also little changed at 5.5 million.
• November consumer credit outstanding increased at an annual rate of 6.75% to $3,979.2 billion. Revolving credit increased at an annual rate of 5.5%, while non-revolving credit increased 7.1%.
• The results of Freddie Mac’s Primary Mortgage Market Survey showed fixed mortgage rates decreasing significantly across the board. The 30-year fixed mortgage rate averaged 4.45% for the week ending January 10, down from last week when it averaged 4.51%. A year ago at this time, the 30-year fixed rate averaged 3.99%. The 15-year fixed mortgage rate averaged 3.89%, down from last week when it averaged 3.99%. A year ago at this time, the 30-year fixed rate averaged 3.44%.
• Mortgage applications increased 23.5% from a week earlier week, according to data from Mortgage Bankers Association’s (MBA) Weekly Applications Survey for the week ending January 4, 2018.

·      Total non-farm payroll employment increased 312 thousand in December, following an increase of 176 thousand in the previous month, according to the U.S. Bureau of Labor Statistics. Private-sector payrolls increased by 301 thousand in December, while government employment increased by 11 thousand. Payroll employment rose by 2.6 million in 2018, compared with a gain of 2.2 million in 2017. Job gains occurred in health care, food services and drinking places, construction, manufacturing, and retail trade.

·      The unemployment rate rose by 0.2 percentage point to 3.9% in December, and the number of unemployed persons increased by 276 thousand to 6.3 million. A year earlier, the jobless rate was 4.1%, and the number of unemployed persons was 6.6 million

·      The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 1.3 million and accounted for 20.5% of the unemployed. Over the year, the number of long-term unemployed declined by 205 thousand.

·      The labor force participation rate remained at 63.1% in December, little changed over the year.

·      The average workweek of all employees on private nonfarm payrolls increased by 0.1 hour to 34.5 hours in December.

·      In December, average hourly earnings of all employees on private nonfarm payrolls increased by 11 cents to $27.48. Over the past 12 months, average hourly earnings were up 3.2%.

·      Unemployment rates were lower in November than a year earlier in 290 of the 388 metropolitan areas, higher in 69 areas, and unchanged in 29 areas, according to the U.S. Bureau of Labor Statistics. Nonfarm payroll employment increased over the year in 54 metropolitan areas, and was unchanged in 334 areas.

·      The advance figure for initial claims for unemployment insurance increased 10 thousand to 231 thousand in the week ending December 29. The 4-week moving average was 218.75 thousand, a decrease of 0.5 thousand from the previous week’s revised average.