Best of all, people are buying those new homes.February saw New Home Sales move up 2.0% for the month, to a 512,000 annual rate, the fourth increase in the last five months.Analysts are putting this to employment gains and a pickup in wage growth, making buying a home within the reach of more people. Buyers have shifted slightly to newly built condos, which aren't counted in the New Home Sales report. The inventory of new single-family homes grew by 4,000 in the month, but is still very low by historical standards. Finally, the FHFA index of homes bought with conforming mortgages was up 0.5% in January and up 6.0% versus a year ago.
The down side to all this is that the Fed thinks there's still a great deal of economic uncertainty going forward. Indeed, the week provided evidence of the so-called "fragility" of this economic recovery. Both the PPI measure of wholesales prices and the CPI gauge of consumer prices dipped in February, drifting further away from the Fed's 2% inflation target. Retail Sales also contracted last month, while Michigan Consumer Sentiment fell some for March. Yet Empire Manufacturing showed growth in factory activity in the New York region for the first time since last July. And we had that very nice Housing Starts number. Fortunately, economic uncertainty goes both ways.
The week ended with the Dow UP 2.2%, to 17599; the S&P 500 UP 1.4%, to 2050; and the Nasdaq UP 1.0%, to 4796.
Author:Victor DeFrisco Phone: 561-951-3759 Dated: April 1st 2016 Views: 159 About Victor: ...
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