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Mortgage rates have continued to trend downward, amidst tensions related to global trade disputes.  Small business owners’ optimism reached a four-month high in April.  Both new purchase and refinance mortgage application submissions declined.  Retail sales also fell.  Home builder sentiment continues to improve.  Jobless claims continue to come in at historic lows.  Housing starts and building permits each improved. 

• The National Federation of Independent Business (NFIB) small-business optimism index hit a four-month high in April, rising 1.7 points to a level of 103.5.  Additionally, eight out of the ten components increased.

• Despite lower mortgage rates, the weekly mortgage application survey declined for the week ending 5/10.  New purchase applications were down 1.0% and refinance applications were down 1.0% for a composite decrease of 0.6%. 

• Retail sales declined in April, down 0.2% month-over-month. 

• The National Association of Home Builders’ (NAHB) housing market sentiment index climbed in May to a level of 66, a 7-month high.  Current sales conditions jumped to a level of 72, expectations for the next six months increased to 72, and buyer foot traffic ticked upward to 49. 

• For the week ending 5/11, initial jobless claims fell to a level of 212,000.  Continuing claims also dropped to a level of 1.66 million.

• Housing starts and building permits turned around in April, after declines in March.  Housing starts increased 5.7% month-over-month to a seasonally adjusted annual rate of 1.24 million and building permits are up almost 1% to a seasonally adjusted annual rate of 1.3 million.  Gains were driven by single-family home construction, up 6.2% to a rate of 854,000. 

Mortgage rates did not move much last week, trending downward according to some sources.  Job openings increased in March, after falling in February.  Consumer credit expanded, but at a slower pace.  Both new purchase and refinance mortgage applications are up, after several weeks of declines.  Jobless claims continue to hit historic lows.  The consumer price index increased, due in part to higher gas prices.

• After falling in February, job openings rebounded in March, suggesting companies are still hiring despite an overall slowdown of economic growth.  The report showed 7.49 million job openings in March.  The voluntary quits rate was unchanged at a level of 2.5%.  Overall, the pace of hiring has slowed, but at 3.6% the unemployment rate is resting at a near 50-year low.

• Consumer borrowing scaled back to the slowest pace in nine months in March.  Total consumer credit increased at an annual rate of 3.1%, down from February’s 4.6% rate of growth.  Revolving credit declined by $2.18 billion from February to March for an annual expansion rate of 1.4%.  Non-revolving credit is up by $12.4 billion from February to March, for an annual expansion rate of 5.3%. 

• For the week ending 5/3, the weekly survey was gainful after several weeks of declines.  New purchase applications ticked up 4.0% and refinance applications improved 1.0% for a composite increase of 2.7%. 

• For the week ending 5/4, initial jobless claims fell to a level of 230,000 and continuing claims increased to a level of 1.68 million. 

• In April, the consumer price index increased 0.3% month-over-month and 2% year-over-year driven by the rising cost of rent and gas.  Excluding food and energy costs, the index is only up 0.1% month-over-month. 

The Federal Open Market Committee met on Tuesday and Wednesday of last week and voted to leave the federal benchmark interest rate unchanged.  Personal income and consumer spending each increased.  Home price appreciation continues to slow.   Consumer confidence turned around.  The pending home sales index jumped.  Both new purchase and refinance mortgage application submissions declined.  US construction spending fell.  The ADP employment report and the employment situation were both positive.  Weekly jobless claims increased but remain historically low. 

• In March, personal income increased 0.1% month-over-month and consumer spending jumped 0.9% month-over-month.  Core inflation is sitting just above a 1.5% annual rate of growth. 

• The Case-Shiller home price index posted the slowest annual rate of appreciation since September 2012.  The 20-city index is up a seasonally adjusted 3.0% year-over-year, and just 0.2% from January to February. 

• Consumer confidence rebounded in April, up to a level of 129.2.  Consumers feel more positive about current economic conditions as well as expectations for the next six months. 

• The pending home sales index surged in March, up 3.8% month-over-month.  Year-over-year however, sales were down 1.2%.  Lower mortgage rates may have jogged some activity, plus the slowdown in home price appreciation created a sweet spot for borrowers. 

• For the week ending 4/26, new purchase applications declined 4.0% and refinance applications fell 5.0% for a composite decrease of 4.3%. 

  The ADP employment report showed the addition of 275,000 jobs.  Medium-sized companies led the gains with 145,000 new jobs, small businesses added 77,000 jobs, and large firms added 53,000 jobs. 

• In March, construction spending declined 0.9% month-over-month to a seasonally adjusted annual rate of $1.282 trillion. 

• The FOMC voted to hold its benchmark interest rate in a target between 2.25% and 2.5%.  President Trump has been using Twitter to urge the FOMC to cut interest rates citing a lack of inflation.  However, it is unlikely that a full percentage interest rate cut is warranted at this time.  In the statement, the Fed said, “economic activity rose at a solid rate” and job growth was also “solid” with a low unemployment rate.  Regarding inflation, the statement read, “On a 12-month basis, overall inflation and inflation for items other than food and energy have declined and are running below 2 percent.”

• For the week ending 4/27, initial jobless claims ticked upward to a level of 230,000.  Continuing claims also increased to a level of 1.67 million.  Even with the past week’s increases, jobless claims remain historically low.

• In April, nonfarm payrolls added 263,000 jobs, private payrolls added 236,000 jobs and manufacturing payrolls added 4,000 jobs.  The unemployment rate declined slightly to a level of 3.6%.  The participation rate is also down to a level of 62.8%.  Average hourly earnings increased 0.2% month-over-month and 3.2% year-over-year.  The average workweek was 34.4 hours.

Mortgage rates did not move significantly this week, trending slightly upward according to some sources.  Existing home sales fell, but new home sales jumped, suggesting construction activity has helped replenish for-sale inventory.  The Federal Housing Finance Agency (FHFA) house price index shows home price appreciation continues to slow.  Both new purchase and refinance mortgage application submissions are down.  Weekly jobless claims continue to register at historic lows.  Gross domestic product (GDP) growth exceeded expectations. 

• Existing home sales declined in March, down 4.9% month-over-month to a seasonally adjusted annual rate of 5.21 million.  The figure is a reversal from February’s record gain of 11.2% month-over-month.

• The Federal Housing Finance Agency (FHFA) house price index appreciated 0.3% month-over-month and 4.9% year-over-year in February.  This data marks the lowest rate of annual price appreciation in four years.  Price growth was weakest in the Mountain States and even the West only posted a 0.2% monthly gain.   

• New home sales, or the sales of newly construction homes, improved in March, up 4.5% month-over-month, to a seasonally adjusted annual rate of 692,000. 

• For the week ending 4/19, new purchase applications declined 4.0% and refinance applications declined 11.0% for a composite decrease of 7.3%. 

• For the week ending 4/20, initial jobless claims increased to a level of 193,000, after reaching a multi-decade low last week.  Continuing claims also increased, to a level of 1.66 million. 

• GDP expanded at a rate of 3.2% during the first three months of 2019, well above forecasts.  The data appears to dispel rumors that economic growth has slowed down and earlier weakness was likely a result of the partial government shutdown. 

Mortgage rates did not move significantly this week, continuing to hover year-long lows.  Small business optimism increased marginally.  There were fewer job openings in February than in January.  New purchase mortgage applications increased, but refinance applications declined.  The consumer price index rebounded.  The Federal Open Market Committee (FOMC) released the minutes from its March meeting.  Weekly jobless claims set a new record low.  The consumer sentiment index declined.

• The National Association of Home Builders’ (NAHB) housing market sentiment index improved by one point in April, to a level of 63.  Current sales conditions increased to a level of 69, expectations for the next six months fell to 71, and buyer foot traffic jumped to 47. 

• The Mortgage Bankers Association (MBA) weekly mortgage application survey returned mixed results for the week ending 4/12.  New purchase application submissions increased 1.0% and refinance application submissions decreased 8.0% for a composite decline of 3.5%. 

• For the week ending 4/13, initial jobless claims fell to a level of 192,000, a 50-year low.  Continuing claims are also down, to a level of 1.65 million, another record low. 

• Retail sales surged in March, up 1.6% month-over-month.  Gains were driven by vehicle sales, sales of new cars and trucks increased 3.1%, and rising gas prices.  Excluding autos, sales are up 1.2% month-over-month, and excluding gas and autos sales are up 0.9% month-over-month. 

• Housing starts and building permits each dropped slightly in March.  Housing starts declined 0.3% month-over-month to a seasonally adjusted annual rate of 1.139 million and building permits fell 1.7% month-over-month to a seasonally adjusted annual rate of 1.269 million.