MetroIntelligence Economic Update by P. DUFFY
Home builder confidence falls for sixth straight month to 67
In a troubling sign for the housing market, builder confidence in the market for newly built single-family homes posted its sixth straight monthly decline in June, falling two points to 67, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) released today. This marks the lowest HMI reading since June 2020. The component charting traffic of prospective buyers fell five points to 48, the HMI index gauging current sales conditions fell one point to 77 and the gauge measuring sales expectations in the next six months fell two points to 61.
Inflation tracker Producer Price Index rises 0.8 percent in May and 10.8 percent year-on-year
The Producer Price Index for final demand increased 0.8 percent in May. On an unadjusted basis, final demand prices moved up 10.8 percent for the 12 months ended in May. Prices for final demand less foods, energy, and trade services moved up 0.5 percent in May. For the 12 months ended in May, the index for final demand less foods, energy, and trade services rose 6.8 percent.
May retail sales up 8.3 percent year-on-year vs. 8.6 percent rise in the CPI
Advance estimates of U.S. retail and food services sales for May 2022, adjusted for seasonal variation but not for price changes, were $672.9 billion, a decrease of 0.3 percent from the previous month, but 8.1 percent above May 2021. However, with the May CPI rising 8.6 percent year-on-year, in inflation-adjusted terms total sales fell 0.5 percent.
Purchase loan applications rise 8 percent from previous week but down 16 percent year-on-year
The Market Composite Index for mortgage applications increased 6.6 percent on a seasonally adjusted basis from one week earlier, with purchase loans rising 8 percent (but down 16 percent year-on-year) and refinance activity rising 4 percent (but down 76 percent year-on-year). The average contract interest rate for 30-year fixed-rate mortgages increased to 5.65 percent from 5.40 percent. The adjustable-rate mortgage (ARM) share of activity decreased to 8.1 percent of total applications.