Economic Update

In the News

The National Association of Home Builders/Wells Fargo monthly housing market index rose three points in September to 40, the highest level since June 2006. This marks the fifth consecutive monthly gain. An index reading below 50 indicates negative sentiment about the housing market.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending September 14 fell 0.2%. Refinancing applications increased 1%. Purchase volume fell 4%.

The combined construction of new single-family homes and apartments in August rose 2.3% to a seasonally adjusted annual rate of 750,000 units. Single-family starts increased 5.5%. Volatile multifamily starts fell 4.9%. Compared to a year ago, housing starts are up 29.1% in August. Applications for new building permits, seen as an indicator of future activity, fell 1% to an annual rate of 803,000 units.

Existing home sales rose 7.8% in August to a seasonally adjusted annual rate of 4.82 million units from 4.47 million units in July. Compared to a year ago, existing home sales were up 9.3% in August. The inventory of unsold homes on the market increased 2.9% to 2.47 million in August, a 6.1-month supply at the current sales pace, down from a 6.4-month supply in July.

The index of leading economic indicators — designed to forecast economic activity in the next three to six months — fell 0.1% in August, following a revised 0.5% increase in July.

Initial claims for unemployment benefits for the week ending September 15 fell by 3,000 to 382,000. Continuing claims for the week ending September 8 fell by 32,000 to 3.272 million.

Upcoming on the economic calendar are reports on the housing price index on September 25, new home sales on September 26 and pending home sales on September 27.

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