Last Week’s Economic News in Review The most recently released reports indicate that consumer credit showed improvement in June, but the pace of its gains clearly slowed. Meanwhile factory orders enjoyed an unexpected bump, and new jobless claims fell below 300,000 again. -Consumer Credit Consumer borrowing was still on the rise in June, but the pace of growth has slowed to its lowest level in four months. Overall, consumer credit rose 6.5 percent in June to hit $3.21 trillion dollars, according to figures released last week by the Federal Reserve. The majority of June’s consumer borrowing growth was fueled by non-revolving debt, such as car loans and student loans. Non-revolving debt increased 8.4 percent for the month to reach $2.33 trillion. Meanwhile, revolving debt, such as credit cards, grew by 1.3 percent to $873 billion. June’s performance showed that many consumers were eschewing whipping out the plastic, and instead focused their borrowing on larger items. While some might initially worry this could impact consumer spending, given positive retail sales in the recent past, what this could indicate is a great willingness on the part of Americans to pursue big-ticket purchases. “Consumers are gradually feeling more comfortable borrowing and lenders are a little more comfortable lending,” Gus Faucher, senior economist at PNC Financial Services Group Inc., told Bloomberg last week. “That’s going to be good for growth.” -Factory Orders Factory orders, considered a sneak-peak of wholesale inventory levels, resumed their positive growth in June after a surprise 0.6 percent drop in May, and actually beat market expectations. New orders for manufactured goods placed in June, grew by 1.1 percent to $503.2 billion, outpacing the 0.5 percent growth that was expected, according to last week’s release from the Census Bureau. This marked the highest level of factory growth since the series was published in 1992. Manufacturers’ shipments, which, like orders, were up four of the last five months, grew 0.5 percent in June to $499.8 billion. Inventories, up 19 of the last 20 months, notched up 0.3 percent in June to $653.8 billion. The inventories-to-shipments ratio was the same as May at 1.31, This also marked the highest shipments and inventories since the series was published in 1992. -Initial Jobless Claims First-time claims for jobless benefits filed by the newly unemployed continued to fall, dropping to an eight-year low. Initial unemployment insurance claims filed in the week ending Aug. 2, dropped by 14,000 claims to 289,000, The Employment and Training Administration reported last week. This also marked the second lowest initial jobless claims figure in the year. The four-week moving average, considered a more stable figure for looking at recent employment activity, dropped to 293,500 claims, a decline of 4,000 from the prior weeks revised average of 297,500. This was the lowest four-week moving average since February 2006. This week, we can expect: • Tuesday — The July budget from the Treasury Department. • Wednesday — July retail sales and June business inventories from the Census Bureau. • Thursday — Initial jobless claims for last week from the Employment and Training Administration; July export and import prices from the Census Bureau and the Bureau of Economic Analysis. • Friday — July producer price index from the Bureau of Labor Statistics; July industrial production and capacity utilization from the Federal Reserve. For additional information on how this economic news has affected the Las Vegas Real Estate Market, call us at (702) 381-4935 or email us at LiveVegasNow@gmail. You may also visit our website at LiveVegasNow/?ts=fb for the latest real estate market information and trends. #LiveVegasNow #KWLV #HomesforSale #LasVegas #EconomicNews
Posted on: Wed, 13 Aug 2014 22:00:01 +0000
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