![]() ![]() Last month's sales pace was the weakest for any June since 2009, during the sub-prime mortgage crisis. Most homeowners have mortgage rates under 5%, meaning they have no incentive to sell. This together with the average rate on the popular 30-year fixed mortgage just under 7%, according to data from mortgage finance agency Freddie Mac, could price first-time buyers out of the market. With supply tight, house prices are rising again on a monthly basis. A third report from the National Association of Realtors showed existing home sales fell 3.3% in June to a seasonally adjusted annual rate of 4.16 million units, the lowest level since January.Ī perennial shortage of houses on the market and higher mortgage rates are weighing on sales. While the labor market remains resilient, housing and manufacturing continue to struggle. The number of people receiving benefits after an initial week of aid, a proxy for hiring, increased 33,000 to 1.754 million during the week ending July 8, the claims report showed.Īt current levels, the so-called continuing claims are low by historical standards, indicating that some laid-off workers are quickly finding work. Claims fell during the June and July survey weeks. The claims data covered the week during which the government surveyed businesses for the nonfarm payrolls component of July's employment report. The dollar rose against a basket of currencies. economist at Oxford Economics in New York. "However, with most of the weakness in a few sentiment-based indicators, the recession signal is not as strong as it appears," said Michael Pearce, lead U.S. economic activity, dropped for the 15th straight month in June, the longest such streak since 2007-08, when the economy was in the midst of the Great Recession. "Many employers are reluctant to reduce headcount despite a slower economy, since the labor market is very tight, which might make rehiring difficult if growth picks up in six or twelve months," said Bill Adams, chief economist at Comerica Bank in Dallas.Įconomists shrugged off a separate report from the Conference Board showing its Leading Economic Index, a gauge of future U.S. The Fed has raised its policy rate by 500 basis points since March 2022, when it kicked off its fastest monetary policy tightening cycle in more than 40 years. central bank is expected to resume hiking rates next Wednesday after skipping an increase in June. The labor market remains tight as companies hoard workers after struggling to find labor during the COVID-19 pandemic, despite the economy slowing because of the Fed's hefty interest rate increases. Claims, relative to the size of the labor market, are way below the 280,000 level that economists say would signal a significant slowdown in job growth. ![]()
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