Weekly Economic Update: December 16-20, 2013

Jan 06 2014

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Nonfarm productivity increased a revised 3.0% for the third quarter of 2013, up from the previous estimate of 1.9%. Industrial production increased 1.1% in November. The consumer price index remained unchanged for November, while core CPI increased 0.2%. Housing starts jumped a higher-than-expected 22.7% to an annualized level of 1.091 million units in November. Building permits declined 3.1% in November after a strong October, but the 1.007 million units pace is up 7.9% from a year ago. The FOMC announced its plans to cut back its accommodative policies in January 2014, with a $10 billion reduction split between Treasuries and mortgage-backed securities, and leave its policy rates unchanged. Existing home sales fell a sharp 4.3% in 4.90 million units annualized in November. Third quarter GDP growth was revised upwards to 4.1% from a previously reported 3.6%. Initial jobless claims rose 10,000 to 379,000 for the week ended 12/14.

• Nonfarm productivity increased a revised 3.0% for the third quarter of 2013, up from the previous estimate of 1.9%. Unit labor costs fell a revised 1.4% from a previously estimated decrease of 0.6%.

• Industrial production increased 1.1% in November. Manufacturing was up 0.6%.

• The consumer price index remained unchanged for November, while core CPI increased 0.2%.

• Housing starts jumped a higher-than-expected 22.7% to an annualized level of 1.091 million units in November.

• Building permits declined 3.1% in November after a strong October, but the 1.007 million units pace is up 7.9% from a year ago.

• The FOMC announced its plans to cut back its accommodative policies in January 2014, a $10 billion reduction split between Treasuries and mortgage-backed securities, and leave its policy rates unchanged. Future reductions in QE purchases will still be data dependent, and beyond the point at which the unemployment rate falls below 6.5%, it is expected that the fed funds rate will likely be low sometime after QE ends. The vote for the statement was 9 to 1 with Boston Fed’s Eric Rosengren dissenting.

• Existing home sales fell a sharp 4.3% to 4.90 million units annualized in November. For the first time in nearly 2½ years, the year-on-year rate is in contraction, down 1.2%. The median home price is down 0.6% to $196,300 following a 0.5% drop last month, but is still up a solid 9.4% from a year ago.

• Third quarter GDP growth was revised upwards to 4.1%, from a previously reported 3.6%. The revision was primarily the result of higher personal consumption expenditures, a boost in the estimate for intellectual property, slightly higher exports, and lower imports than previously reported.

• Initial jobless claims rose 10,000 to 379,000 for the week ended December 14th.

 

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