MBA Purchase Applications (week ended 5/31/2013)
– Purchase Index Week/Week -2.0%. Previous weeks were 3.0%, -3.0%, -4.0%, +2.0%, and -1.4%.
– Refinance Index Week/Week -15.0%. Previous weeks were -12.0%, -12.0%, -8.0%, +3.0%, and +0.3%.
– Composite Index Week/Week -11.5%. Previous weeks were -8.8%, -9.8%, -7.3%, +7.0%, and +1.8%.
The fell-over-the-cliff drop in refinance applications is due to higher rates. The drop in purchase applications requires a more detailed analysis. Some of it may have to do with higher rates. Some of it may be due to the fact that we have more renters and fewer home owners. A large percentage of Housing Starts in recent months has been of apartment units. The building of apartments units provides construction jobs and the purchase of appliances, floor coverings, etc. but probably does not induce as much spending as when folks buy and move into a single family residence.
ADP Private Jobs (May 2013)
– ADP Jobs +135,000. Previous was revised from +119,000 to +113,000.
This report is mediocre at best and certainly not as good as expected. If prefigures what may well be another BLS report showing a job increase just keeping up with population growth. We may even hear the expression “jobless recovery.” The facts are that 1) the recovery is still weak and 2) the jobs recovery is even weaker.
Productivity and Costs (1stQ2013)
– Nonfarm productivity Quarter/Quarter (seasonally adjusted, annualized) +0.5%. Previous was +0.7%
– Unit labor costs Quarter/Quarter (seasonally adjusted, annualized) -4.3%. Previous was 0.5%.
Note that drop in Unit Labor Costs was by comparison with 4thQ2012 which saw a sharp increase of +11.8%. Presumably that increase was to avoid the higher tax rates which took effect at the start of this year.
Factory Orders (April 2013)
– Factory Orders were +1.0% with the previous adjusted from -4.0% to -4.7%. Translation: flat.
ISM Non-Manufacturing Index (May 2013)
– Composite Index 53.7. Previous was 53.1.
No surprise with the last two items. Service sector is improving while manufacturing is flat.