Most of this week’s U.S. economic data came out today, so let’s quickly summarize.📝
First, new home sales rose in October despite mortgage rates staying elevated. They rebounded 7.5% to a 632,000 unit annual rate, with September’s sales revised down 15,000 units to 588,000. The median selling price was up 15.4% YoY to $493,000. Supply remains tight, with completed homes accounting for just 13% of the inventory, less than half the long-term average. 🏘️
U.S. business activity contracted for the fifth straight month in November, with a measure of new orders falling to a 2.5-year low. The U.S. Manufacturing PMI dropped to 47.6, indicating a contraction in manufacturing activity for the first time since the pandemic. The services measure fell to 46.3, down from 48.2 in October. The Fed’s tightening is clearly impacting many of these leading indicators of economic activity. 🔻
Additionally, initial jobless claims rose by 17,000 to a 3-month high of 240,000. Continuing jobless claims rose 48,000 to 1.551 million. While these numbers are still meager by historical standards, economists will be watching this as an early indicator of a meaningful shift in the currently strong labor market. 🏋️
Finally, Michigan Consumer Sentiment jumped marginally in November, helped by a modest decline in inflation expectations. 👍