Last Weeks Economic News in Review November 19, 2013 Last week saw mixed economic results, with improving employment, but an unexpectedly widening trade gap with dropping import and export prices, signaling that the economy will continue its recovery in fits and starts. Employment First-time claims for unemployment benefits fell for the fifth straight week during the week ending Nov. 9, according to last week’s report from the Employment and Training Administration. That said, the total was slightly higher than projections. Claims filed for the week ticked down to 339,000, a slight decrease of 2,000 claims from the previous week’s revised figure of 341,000. The total number of unemployed Americans covered by unemployment insurance during the week ending Nov. 2 was 2,874,000, the Administration also reported. This was unchanged from the previous weeks revised level of 2,874,000, and the four-week moving average was 2,866,250, which was down 2,000 from the prior weeks average 2,868,250, a small, but welcome sign. Many labor market experts had expected this measured employment performance, and cited fears over political and economic uncertainties as its main cause. Trade Balance In the meantime, the trade deficit widened unexpectedly to its biggest gap in four months, with September totaling $188.9 billion and imports ringing in at $230.7 billion, according to last week’s report from the Census Bureau and the Bureau of Economic Analysis. This resulted in a goods and services deficit of $41.8 billion, up from $38.7 billion in August. Expectations were for a gap of roughly $39 billion. Some analysts chalked up the nearly $3 billion difference to underperforming exports in September, which were $0.4 billion less than August exports of $189.3 billion. September imports were $2.7 billion more than August imports of $228.0 billion, marking their highest point since November 2012. It’s also worth noting that petroleum played a big role in September’s overall trade activity. Petroleum imports pushed the petroleum deficit from $18.6 billion to $19.8 billion in September, which was nearly half of the month’s total deficit. Import and Export Prices In related news, lower fuel prices led import prices to notch down 0.7 percent in October, the Bureau of Labor Statistics reported last week. This followed small advances of between 0.1 percent and 0.2 percent over the last three months. It’s worth noting that import prices decreased 2 percent for the year ended in October, which was the largest 12-month decline since a 2.7 percent drop between April 2012 and April 2013. Export prices fell 0.5 percent in October, after a 0.4 percent increase in September. Prior to September, export prices had been on a downward trend. The last time export prices advanced was in February with a 0.7 percent gain. In addition to dropping fuel prices impacting both import and export prices, the downward trend in import prices also highlights the fact that consumers abroad, particularly those in Europe, were having enough trouble that U.S. importers couldn’t justify price increases. Altogether, these factors point to continued middling trade performance worldwide. This week, we can expect to see: Wednesday — October retail sales and September Business Inventories from the Census Bureau; October consumer price index from the Bureau of Labor Statistics; October existing home sales from the National Association of Realtors. Thursday — Initial jobless claims for last week from the Employment and Training Administration; October producer price index from the Bureau of Labor Statistics; October Leading Economic Indications index from The Conference Board. JENNIFERTOLLEY Senior Mortgage Loan Officer direct: (864) 886-2278 4107 Liberty Hwy NMLS: 78886 Anderson, SC 29607 jenny.tolley@movementmortgage movementmortgage/jenny.tolley
Posted on: Tue, 19 Nov 2013 18:48:59 +0000
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