MetroIntelligence Economic Update by P. DUFFY
Housing starts fall 5.1 percent in August, but still up 2.8 percent year-on-year
Privately-owned housing starts in August were at a seasonally adjusted annual rate of 1,416,000. This is 5.1 percent below the revised July estimate of 1,492,000, but is 2.8 percent above the August 2019 rate of 1,377,000.
Building permits slip 0.9 percent from July, nearly flat year-on-year
Privately-owned housing units authorized by building permits in August were at a seasonally adjusted annual rate of 1,470,000. This is 0.9 percent below the revised July rate of 1,483,000 and is 0.1 percent below the August
2019 rate of 1,471,000.
Initial unemployment claims dip 3.7 percent to 860,000
In the week ending September 12, initial unemployment claims were 860,000, a decrease of 33,000, or 3.7 percent, from the previous week’s revised level. Continuing claims during the week ending September 5 were 12,628,000, a decrease of 916,000, or 6.8 percent, from the previous week’s revised level. The total number of people claiming benefits in all programs for the week ending August 29 was 29,768,326, an increase of 98,456, or 0.03 percent, from the previous week.
Federal Reserve updates economic forecast through 2023
The Federal Reserve updated its economic projections through 2023, and is now looking for unemployment to end the year at 7.6 percent, down substantially from June’s forecast of 9.3 percent. However, the Fed is also expecting slower growth in the years ahead, with annual GDP growth of 4.0 percent in 2021, 3.0 percent in 2022, and 2.5 percent in 2023. These slower growth rates are partly due to a stronger-than-predicted rebound since June. Three months ago, the Fed predicted GDP falling 6.5 percent this year and then growing 5 percent in 2021. The Fed now sees GDP contracting 3.7 percent this year and expanding 4 percent in 2021.