Federal Reservations

Treasury prices bounce after a U.S. auction and the Federal reserve says it will keep rates low until late 2014.

Originally from MarketWatch

WASHINGTON (Reuters) - U.S. consumer credit posted its largest decline in more than a year in August, according to a Federal Reserve report on Friday that suggested consumers were reluctant to hold more debt amid a shaky economic recovery.

Originally from Reuters: Business News

Notes: This CoreLogic Home Price Index report is for August. The Case-Shiller index released last week was for July. Case-Shiller is currently the most followed house price index, but CoreLogic is used by the Federal Reserve and is followed by many analysts. The CoreLogic HPI is a three month weighted average of June, July and August (August weighted the most) and is not seasonally adjusted (NSA).

From CoreLogic: CoreLogic® August Home Price Index Shows Month-Over-Month and Year-Over-Year Decline

CoreLogic ... today released its August Home Price Index (HPI) which shows that home prices in the U.S. decreased 0.4 percent on a month-over-month basis, the first monthly decline in four months. According to the CoreLogic HPI, national home prices, including distressed sales, also declined on a year-over-year basis by 4.4 percent in August 2011 compared to August 2010. This follows a decline of 4.8 percent in July 2011 compared to July 2010. Excluding distressed sales, year-over-year prices declined by 0.7 percent in August 2011 compared to August 2010 and by 1.7 percent in July 2011 compared to July 2010. ...

“Although the calendar says August, the end of the summer traditionally marks the beginning of ‘fall’ for the housing market as it begins to prepare for ‘winter.’ So the slight month-over-month decline was predictable, particularly given the renewed concerns over a double-dip recession, high negative equity, and the persistent levels of shadow inventory. The continued bright spot is the non-distressed segment of the market, which is only marginally lower than a year ago and continues to exhibit relative strength,” said Mark Fleming, chief economist for CoreLogic.

Click on graph for larger image in graph gallery.

This graph shows the national CoreLogic HPI data since 1976. January 2000 = 100.

The index was down 0.4% in August, and is down 4.4% over the last year, and off 30.4% from the peak - and up 4.8% from the March 2011 low.

As Mark Fleming noted, some of this decrease is seasonal (the CoreLogic index is NSA). Month-to-month prices changes will probably remain negative through February or March 2012 - the normal seasonal pattern. It is likely that there will be new post-bubble lows for this index late this year or early in 2012.

Originally from Calculated Risk

The National Association of Realtors is reporting a 7.7% increase in August existing home sales. Economist Patrick Newport of IHS Global Insight says this must be an aberration. And what can the Federal Reserve do to help the struggling housing market? Very little, Newport says, given that the already low 30-year mortgage rates have done nothing to spur demand for mortgages.

Originally from MarketWatch

From the Philly Fed:

The Federal Reserve Bank of Philadelphia has released the coincident indexes for the 50 states for August 2011. In the past month, the indexes increased in 26 states, decreased in 17, and remained unchanged in seven for a one-month diffusion index of 18. Over the past three months, the indexes increased in 33 states, decreased in 16, and remained unchanged in one (Maryland) for a three-month diffusion index of 34.

Note: These are coincident indexes constructed from state employment data. From the Philly Fed:

The coincident indexes combine four state-level indicators to summarize current economic conditions in a single statistic. The four state-level variables in each coincident index are nonfarm payroll employment, average hours worked in manufacturing, the unemployment rate, and wage and salary disbursements deflated by the consumer price index (U.S. city average). The trend for each state’s index is set to the trend of its gross domestic product (GDP), so long-term growth in the state’s index matches long-term growth in its GDP.

Click on graph for larger image.

This is a graph is of the number of states with one month increasing activity according to the Philly Fed. This graph includes states with minor increases (the Philly Fed lists as unchanged).

In August, 30 states had increasing activity, the lowest number since January 2010. Looking back at previous recessions, the current level is close to when the U.S. entered recession - however it is important to remember that August was an especially weak month due to the debt ceiling debate.

In February, 47 states showed increasing activity.

Here is a map of the three month change in the Philly Fed state coincident indicators. Several states have turned red again. This map was all red during the worst of the recession, and all green not long ago.

Earlier:
• Housing Starts decline in August

Originally from Calculated Risk

Earlier today the BLS reported:

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4 percent in August on a seasonally adjusted basis ... The gasoline index rose for the 12th time in the last 14 months and led to a 1.2 percent increase in the energy index, while the food index rose 0.5 percent, its largest increase since March. ... The index for all items less food and energy increased 0.2 percent in August, the same increase as the previous month.

The Cleveland Fed released the median CPI and the trimmed-mean CPI this morning:

According to the Federal Reserve Bank of Cleveland, the median Consumer Price Index rose 0.3% (3.6% annualized rate) in August. The 16% trimmed-mean Consumer Price Index increased 0.3% (4.0% annualized rate) during the month. The median CPI and 16% trimmed-mean CPI are measures of core inflation calculated by the Federal Reserve Bank of Cleveland based on data released in the Bureau of Labor Statistics' (BLS) monthly CPI report.

Earlier today, the BLS reported that the seasonally adjusted CPI for all urban consumers rose 0.4% (4.6% annualized rate) in August. The CPI less food and energy increased 0.2% (3.0% annualized rate) on a seasonally adjusted basis.

Over the last 12 months, the median CPI rose 2.0%, the trimmed-mean CPI rose 2.4%, the CPI rose 3.8%, and the CPI less food and energy rose 2.0%

Note: The Cleveland Fed has a discussion of a number of measures of inflation: Measuring Inflation. You can see the median CPI details for August here.

Click on graph for larger image in graph gallery.

On a year-over-year basis, these measures of inflation are increasing, and are near the Fed's target.

On a monthly basis, the median Consumer Price Index increased 3.6% at an annualized rate, the 16% trimmed-mean Consumer Price Index increased 4.0% annualized in July, and core CPI increased 3.0% annualized.

Earlier:
• Weekly Initial Unemployment Claims increased to 428,000
• Industrial Production increased 0.2% in August, Capacity Utilization increases slightly
• NY and Philly Fed Manufacturing surveys show contraction

Originally from Calculated Risk

WASHINGTON (MarketWatch) - The Cleveland Federal Reserve on Thursday said its trimmed-mean consumer price index rose 0.3% in August. The trimmed-mean CPI is seen by some economists as a better measure of underlying inflation than the Labor Department's so-called core rate. The trimmed-mean CPI has risen at an annual rate of 2.4% in May, which is lower than the 3.8% rate recorded by the Labor Department's core CPI. The trimmed-mean CPI does not exclude food and energy like the Labor data, instead subtracting the most volatile categories in each monthly report.

Originally from MarketWatch

Forexpros – Gold futures rallied on Friday, re-approaching the all-time high after a report showing the U.S. economy added zero jobs in August boosted the safe haven appeal of the precious metal and fuelled expectations for additional stimulus from the Federal Reserve.

On the Comex division of the New York Mercantile Exchange, gold futures for October delivery settled at USD1,883.25 a troy ounce by close of trade on Friday, jumping 2.95% over the week, the biggest weekly gain since August … [visit site to read more] or compare Best Credit Cards and Balance Transfer Credit Cards

Originally from DailyMarkets.com

Nonfarm payroll employment comes in unchanged in August, the weakest performance since September 2010. The grim report could serve as a catalyst for further Federal Reserve easing.

Originally from MarketWatch

Nonfarm payroll employment comes in unchanged in August, the weakest performance since September 2010. The grim report could serve as a catalyst for further Federal Reserve easing.

Originally from MarketWatch