The three-month average of the Chicago Fed National Activity Index (CFNAI) is expected to increase slightly to -0.07 in the March update that’s scheduled for Monday (Apr. 20), based on The Capital Spectator’s median point forecast for several econometric estimates. The projection is incrementally above the -0.08 reading for February, which reflected a a mildly below-average pace of economic growth for the US relative to the historical trend. Only negative values below -0.70 indicate an “increasing likelihood” that a recession has started, according to guidelines from the Chicago Fed. Using today’s estimate for March as a guide, CFNAI’s three-month average is expected to remain at a rate of growth that’s slightly below the historical trend.
Continue reading →

US economic growth slowed in this year’s first quarter, perhaps to the point that the quarterly change for Q1 GDP will be flat in the Commerce Department’s “advance” estimate that’s scheduled for release on Apr. 29. From a business cycle perspective, however, the recent deceleration is modest so far. Indeed, there’s still a high degree of forward momentum in the macro trend based on the numbers in hand. Yes, the tide has turned, but moderately so and after a period of relatively strong growth.
Continue reading →

● March housing starts in US rise but miss estimates | USA Today
● US jobless claims hit highest level in six weeks | MarketWatch
● Consumer Comfort in US Cools From Highest Level Since 2007 | Bloomberg
● Philly Fed Index Rises More Than Expected In April | RTT
● UK employment jumps, jobless rate lowest since July 2008 | Reuters
● Prices start to rise in euro zone, easing deflation fears | Reuters

Residential housing construction rebounded last month, but by less than expected, the US Census Bureau reports. Econoday.com’s consensus view anticipated a strong gain to 1.04 million units in seasonally adjusted annualized terms for March. The actual number turned out to be substantially lower: 926,000. That’s above February’s revised total of 908,000 starts, but mildly so. No wonder that the annual trend for construction remains flat to negative so far this year.
Continue reading →

As it lays the groundwork for raising interest rates, the Federal Reserve has been squeezing the annual growth rate of the real (inflation-adjusted) supply of so-called high-powered money (aka base money (M0)). But economic growth has turned wobbly lately, including yesterday’s disappointing report on industrial production for March. The slowdown bias overall is expected to pare US GDP growth in this year’s first quarter to a virtual standstill, according to the Atlanta Fed’s current projection. Given the current climate, it’s no surprise to learn that the year-over-year change for the real monetary base ticked higher in March after decelerating sharply for more than a year.
Continue reading →

● Mining, utilities sink US industrial production in March | Reuters
● New York Manufacturing Activity Unexpectedly Contracts In April | RTT
● Survey Indicates Builder Confidence on the Rise in April | MReport
● US Mortgage Applications Fall After Consecutive Gains | ON
● Inflation Expected at 1.7% In Year Ahead via Atlanta Fed Survey | Atlanta Fed
● Fed beige book: US Economy still growing but slowly | USA Today

Housing starts are expected to increase at an annual pace of 971,000 units (seasonally adjusted) in tomorrow’s update for March, according to The Capital Spectator’s median point forecast for several econometric estimates. The projection represents a substantially higher level of residential construction vs. February’s data.
Continue reading →

Output in the US industrial sector slumped a hefty 0.6% in March, far more more than expected. The decline marks the third monthly slide in the past four months and the biggest decrease since mid-2012, the Federal Reserve reports. More troubling is the ongoing deceleration in the year-over-year growth rate for industrial output.
Continue reading →

Healthcare stocks remain the top performer among the major equity sectors, based on the trailing 252-trading-day (1 year) period through April 14 via a set of ETF proxies. Meanwhile, energy shares have been trending higher in recent weeks. The question is whether it’s different this time for energy’s rally. Previous revivals over the past year have been brief affairs that fizzled out in this battered corner of the equity space.
Continue reading →

● US Retail sales rise for first time in 5 months, but signs of softness linger | WSJ
● US NFIB small business optimism index fell across the board in March | DMN
● China’s G.D.P. Slows to 7 Percent, the Weakest Rate Since 2009 | NY Times
● Germany’s consumer prices increased for 2nd straight month in March | RTT
● France consumer prices fall For third month | RTT
● India’s Wholesale Prices Fall For Fifth Month | RTT