Economic Reports

The Housing Starts report measures the number of residential units on which construction is begun each month. A start in construction is defined as the beginning of excavation of the foundation for the building and is comprised primarily of residential housing. It is a seasonally adjusted annualized rate of houses (residential units) started in a given month, taken from a sample of 844 out of 17,000 permit sites. The monthly national report is broken down by region, and shows the breadth of change. The regional data is subject to volatility due to weather changes and/or natural disasters. Housing is very interest rate sensitive and is one of the first sectors to react to changes in interest rates. Significant reaction of start/permits to changing interest rates signals interest rates are nearing trough or peak. To analyze, focus on the percentage change in levels from the previous month. This indicator becomes important around turning points in the business cycle. Home builders don't start a house unless they are fairly confident it will sell upon its completion, if not before. Changes in the rate of housing starts tell us a lot about home demand for homes and construction outlook. Furthermore, each time a new home is started, construction employment rises, revenues for the home builder and a myriad of other producers also increase; the economic "ripple effect" can be substantial. The Housing Starts report is scheduled for release at 7:30 (CST) around the 16th of the month by the Census Bureau of the Department of Commerce.

The Chicago PMI (ISM-Chicago Business Barometer) measures the performance of the manufacturing and non-manufacturing sector in the Chicago region. The Index is computed from five weighted raw indexes: Production (0.25), New Orders (0.35), Order Backlog (0.15), Employment (0.10), and Supplier Deliveries (0.15) and then seasonally adjusted to support month-to-month comparisons. A reading above 50 indicates an expansion; below 50 represents a contraction; while 50 indicates no change. Chicago PMI is released one day before the ISM Manufacturing Index.

The University of Michigan Consumer Sentiment Index is a consumer confidence index published monthly by the University of Michigan. The index is normalized to have a value of 100 in the first quarter of 1966. Each month at least 500 telephone interviews are conducted of a contiguous United States sample.

CPI- CONSUMER PRICE INDEX

JANUARY 2023 CPI WEIGHT UPDATE

Starting with January 2023 data, the BLS plans to update weights annually for the Consumer Price Index based on a single calendar year of data, using consumer expenditure data from 2021. This reflects a change from prior practice of updating weights biennially using two years of expenditure data.

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The Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. Indexes are available for the U.S. and various geographic areas. Average price data for select utility, automotive fuel, and food items are also available.

The ISM Manufacturing Index, commonly known as the ISM Manufacturing Purchasing Managers Index (ISM PMI), is a monthly gauge of the level of economic activity in the manufacturing sector in the United States versus the previous month.

The ISM Manufacturing Index is published at the beginning of each month at 10 a.m. Eastern Time by the Institute for Supply Management (ISM), a not-for-profit organization professional supply management organization based in Arizona, USA.

The New York Fed conducts this monthly survey of manufacturers in New York State. Participants from across the state represent a variety of industries. On the first of each month, the same pool of roughly 175 manufacturing executives (usually the CEO or the president) is sent a questionnaire to report the change in an assortment of indicators from the previous month. Respondents also give their views about the likely direction of these same indicators six months ahead. This index is seasonally adjusted using the Philadelphia Fed's seasonal factors because its own history is not long enough with data only going back a couple of years.

Investors track economic data like the Empire State Manufacturing Survey to understand the economic backdrop for the various markets. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers a moderate growth environment that won't generate inflationary pressures.

The Empire Manufacturing Survey gives a detailed look at New York State’s manufacturing sector, how busy it is and where things are headed. Since manufacturing is a major sector of the economy, this report has a big influence on the markets. Some of the Empire State Survey sub-indexes also provide insight on commodity prices and other clues on inflation. The Federal Reserve closely watches this report because when inflation signals are flashing, policymakers can reset the direction of interest rates. As a consequence, the bond market can be highly sensitive to this report. The equity market is also sensitive to this report because it is the first clue on the nation's manufacturing sector, reported in advance of the Philadelphia Fed's business outlooks survey, the NAPM-Chicago index and the ISM manufacturing index.

Existing Home Sales is a measure of the selling rate of pre-owned single-family homes, collected by the National Association of Realtors from 650 realtor associations. It includes a geographical breakdown, as well as a measure of prices and house inventory, the number of months it would take to deplete the existing supply of pre-owned houses at the current sales pace. The data is timely and is used in conjunction with the new home sales release from the Census Bureau. Sales of existing (or pre-owned) houses account for roughly 84% of all houses sold. Sales of new houses account for the other 16%. Simply, the volume of sales indicates housing demand. Also, the monthly supply of homes serves as an input into the level of housing pressure. However, when analyzing sales trends, one must remember to take into account unusual weather and seasonal effects. This report sometimes moves markets and is considered a good gauge of near-term spending for housing-related items and of consumer spending in general. The Existing Home Sales report is scheduled for release at 9:00 (CST) on the 25th of every month (or on the first business day thereafter) by the National Association of Realtors.

The Federal Open Market Committee (FOMC) consists of twelve members--the seven members of the Board of Governors of the Federal Reserve System; the president of the Federal Reserve Bank of New York; and four of the remaining eleven Reserve Bank presidents, who serve one-year terms on a rotating basis. The rotating seats are filled from the following four groups of Banks, one Bank president from each group: Boston, Philadelphia, and Richmond; Cleveland and Chicago; Atlanta, St. Louis, and Dallas; and Minneapolis, Kansas City, and San Francisco. Nonvoting Reserve Bank presidents attend the meetings of the Committee, participate in the discussions, and contribute to the Committee's assessment of the economy and policy options.

The FOMC holds eight regularly scheduled meetings per year. At these meetings, the Committee reviews economic and financial conditions, determines the appropriate stance of monetary policy, and assesses the risks to its long-run goals of price stability and sustainable economic growth.

The gross domestic product implicit price deflator, or GDP deflator, measures changes in the prices of goods and services produced in the United States, including those exported to other countries. Prices of imports are excluded.

The Housing Market Index is data from a survey of home builders reflecting single-family home sales on the present, the next six months and traffic from prospective buyers. This composite index indicates housing market trends. This provides a gauge of not only the demand for housing, but consumer sentiment as well. Furthermore, this narrow piece of data has a powerful multiplier effect through the economy, and therefore across the markets and investments. Each time the construction of a new home begins, it translates to more construction jobs, and income which will be pumped back into the economy. Once a home is sold, it generates revenues for the home builder and the realtor. It brings a myriad of consumption opportunities for the buyer. Refrigerators, washers, dryers and furniture are just a few items new home buyers might purchase. The economic "ripple effect" can be substantial especially when you think a hundred thousand new households around the country are doing this every month. Since the economic backdrop is the most pervasive influence on financial markets, housing construction has a direct bearing on stocks, bonds and commodities. In a more specific sense, trends in the NAHB housing index carries valuable clues for the stocks of home builders, mortgage lenders and home furnishings companies. The Housing Market Index is scheduled for release at 12:00 (CST) mid-month by the National Association of Home Builders.

The Housing Starts report measures the number of residential units on which construction is begun each month. A start in construction is defined as the beginning of excavation of the foundation for the building and is comprised primarily of residential housing. It is a seasonally adjusted annualized rate of houses (residential units) started in a given month, taken from a sample of 844 out of 17,000 permit sites. The monthly national report is broken down by region, and shows the breadth of change. The regional data is subject to volatility due to weather changes and/or natural disasters. Housing is very interest rate sensitive and is one of the first sectors to react to changes in interest rates. Significant reaction of start/permits to changing interest rates signals interest rates are nearing trough or peak. To analyze, focus on the percentage change in levels from the previous month. This indicator becomes important around turning points in the business cycle. Home builders don't start a house unless they are fairly confident it will sell upon its completion, if not before. Changes in the rate of housing starts tell us a lot about home demand for homes and construction outlook. Furthermore, each time a new home is started, construction employment rises, revenues for the home builder and a myriad of other producers also increase; the economic "ripple effect" can be substantial. The Housing Starts report is scheduled for release at 7:30 (CST) around the 16th of the month by the Census Bureau of the Department of Commerce.

Initial jobless claims measure the number of people (non industry-specific) filing first-time claims for state unemployment insurance. This report provides a timely, but often misleading, indicator of the direction of the economy, with changes in claims potentially signaling changes in job growth. It is assumed the stronger the job market, the greater the spending power, the healthier the economy.

Weekly claims are volatile and data can be skewed by holidays; therefore, many analysts track a four week moving average of data to get a better sense of the underlying trend in claims. It typically takes a sustained move of at least 30,000 in claims to signal a meaningful change in job growth. Unemployment claims can fall to such a low level that businesses have a tough time finding new workers. This puts wage pressures on the economy, leading to wage inflation, which is bad news for the stock and bond markets. If wage inflation threatens, it's a good bet interest rates will rise and bond and stock prices will fall.

This report is timely and occasionally moves the market. Although volatile and subject to big revisions, it is considered a good gauge of labor market conditions and an indicator of the employment report. The Initial Jobless Claims report is scheduled for release at 7:30 (CST) every Thursday by the Employment and Training Administration of the Department of Labor.

Purpose

These data serve as demand-side indicators of labor shortages at the national level. Prior to JOLTS, there was no economic indicator of the unmet demand for labor with which to assess the presence or extent of labor shortages in the United States. The availability of unfilled jobs—the job openings rate—is an important measure of the tightness of job markets, parallel to existing measures of unemployment.

Scope

Data from a sample of approximately 21,000 U.S. business establishments are collected by the Bureau of Labor Statistics through the Atlanta JOLTS Data Collection Center. The JOLTS survey covers all nonagricultural industries in the public and private sectors for the 50 States and the District of Columbia.

A sale of the new house occurs with the signing of a sales contract or the acceptance of a deposit. The house can be in any stage of construction: not yet started, under construction, or already completed. New home sales account for about 10 percent of the US housing market. New single-family home sales are extremely volatile month-to-month and preliminary figures are subject to large revisions because they are mostly drawn from building permits data.

The PCE Price Index Excluding Food and Energy, also known as the core PCE price index, is released as part of the monthly Personal Income and Outlays report. The core index makes it easier to see the underlying inflation trend by excluding two categories – food and energy – where prices tend to swing up and down more dramatically and more often than other prices. The core PCE price index is closely watched by the Federal Reserve as it conducts monetary policy.

This comes out with numbers for year over year and monthly

Personal income is the income that persons receive in return for their provision of labor, land, and capital used in current production and the net current transfer payments that they receive from business and from government.25 Personal income is equal to national income minus corporate profits with inventory valuation and capital consumption adjustments, taxes on production and imports less subsidies, contributions for government social insurance, net interest and miscellaneous payments on assets, business current transfer payments (net), current surplus of government enterprises, and wage accruals less disbursements, plus personal income receipts on assets and personal current transfer receipts.

Consumer spending, or personal consumption expenditures (PCE), is the value of the goods and services purchased by, or on the behalf of, U.S. residents. At the national level, BEA publishes annual, quarterly, and monthly estimates of consumer spending.

There are many regional manufacturing surveys or indices, and they tend to be ranked in order of timeliness and the importance of the region. The two most important are the Chicago PMI and the Philadelphia Fed Index, in that order. While the Chicago PMI has an impressive 91% positive correlation with the national ISM Index, the Philadelphia Fed Index has a decent 78% positive correlation with the national ISM Index. The Philadelphia Fed's survey is first each month, actually coming out during the third week of the month for which it is reporting. Several smaller surveys are then released before the Chicago purchasing managers' report on the last day of each month. The purchasing managers' reports are measured like the national ISM Index - 50% marks the breakeven line between an expanding and contracting manufacturing sector. However, for the Philadelphia Fed index, 0 is the breakeven mark. These surveys can be of some help in forecasting the national ISM Index - particularly the Philadelphia and Chicago surveys which are more closely watched due to their timeliness and the fact that these regions represent a reasonable cross section of national manufacturing activities.

Personal income is the income that persons receive in return for their provision of labor, land, and capital used in current production and the net current transfer payments that they receive from business and from government.25 Personal income is equal to national income minus corporate profits with inventory valuation and capital consumption adjustments, taxes on production and imports less subsidies, contributions for government social insurance, net interest and miscellaneous payments on assets, business current transfer payments (net), current surplus of government enterprises, and wage accruals less disbursements, plus personal income receipts on assets and personal current transfer receipts.

The Producer Price Index (PPI) program measures the average change over time in the selling prices received by domestic producers for their output. The prices included in the PPI are from the first commercial transaction for many products and some services.

PPIs measure price change from the perspective of the seller. This contrasts with other measures, such as the Consumer Price Index (CPI), that measure price change from the purchaser's perspective. Sellers' and purchasers' prices may differ due to government subsidies, sales and excise taxes, and distribution costs.

The Producer Price Index (PPI) program measures the average change over time in the selling prices received by domestic producers for their output. The prices included in the PPI are from the first commercial transaction for many products and some services.

Purchasing Managers’ Index™ (PMI™) data are compiled by S&P Global for more than 40 economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies and are available only via subscription. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment and inventories. The PMI data are used by financial and corporate professionals to better understand where economies and markets are headed, and to uncover opportunities.

The retail sales report is a measure of the total receipts of retail stores from samples representing all sizes and kinds of business in retail trade throughout the nation. It is the most timely indicator of broad consumer spending patterns and is adjusted for normal seasonal variation, holidays, and trading-day differences. Retail sales include durable and nondurable merchandise sold, and services and excise taxes incidental to the sale of merchandise. Excluded are sales taxes collected directly from the customer. It also excludes spending for services, a large component of consumer expenditures. Retail sales is a the first picture of consumer spending for a given month.

The retail sales report is a measure of the total receipts of retail stores from samples representing all sizes and kinds of business in retail trade throughout the nation. It is the most timely indicator of broad consumer spending patterns and is adjusted for normal seasonal variation, holidays, and trading-day differences. Retail sales include durable and nondurable merchandise sold, and services and excise taxes incidental to the sale of merchandise. Excluded are sales taxes collected directly from the customer. It also excludes spending for services, a large component of consumer expenditures. Retail sales is a the first picture of consumer spending for a given month.

Retail Sales ex-autos takes out the volatile car sales figure.

The S&P CoreLogic Case-Shiller Home Price Indices are the leading measures of U.S. residential real estate prices, tracking changes in the value of residential real estate nationally.

The S&P CoreLogic Case-Shiller 20-City Composite Home Price Index measures changes in residential house prices in 20 metropolitan regions in the United States: Atlanta, Boston, Charlotte, Chicago, Cleveland, Dallas, Denver, Detroit, Las Vegas, Los Angeles, Miami, Minneapolis, New York, Phoenix, Portland, San Diego, San Francisco, Seattle, Tampa and Washington D.C.

Purchasing Managers’ Index™ (PMI™) data are compiled by S&P Global for more than 40 economies worldwide. The monthly data are derived from surveys of senior executives at private sector companies and are available only via subscription. The PMI dataset features a headline number, which indicates the overall health of an economy, and sub-indices, which provide insights into other key economic drivers such as GDP, inflation, exports, capacity utilization, employment and inventories. The PMI data are used by financial and corporate professionals to better understand where economies and markets are headed, and to uncover opportunities.