Economic Update

Total construction spending rose 0.4% to $860.8 billion in April, following a 0.8% decrease in March. Compared to April 2012, construction spending has risen 4.3%.

Manufacturing activity fell to 49 in May after a reading of 50.7 in April. A reading below 50 signals contraction. This was the first contraction after five consecutive months of expansion.

Motor vehicle sales rose 2.7% in May to an annualized sales rate of 15.3 million cars and light trucks. Auto sales have steadily recovered since bottoming out in 2009 when Americans purchased 10 million cars.

The trade deficit increased from $37.1 billion in March to $40.3 billion in April. Exports rose $2.2 billion to $187.4 billion. Imports increased $5.4 billion to $227.7 billion.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending May 31 fell 11.5%. Purchase volume fell 2%. Refinancing applications decreased 15%.

Factory orders rose $4.9 billion, or 1%, in April to a seasonally adjusted $474 billion. This follows a 4.7% decrease in March. Excluding the volatile transportation sector, orders decreased 0.1% in April.

Non-manufacturing activity rose to 53.7 in May from 53.1 in April. A reading above 50 signals expansion. It was the 41st straight month of expansion in the services sector.

Initial claims for unemployment benefits for the week ending June 1 fell by 11,000 to 346,000. Continuing claims for the week ending May 25 fell by 52,000 to 2.952 million. The less volatile four-week average of claims for unemployment benefits was 352,500. The unemployment rate increased from 7.5% in April to 7.6% in May. Employers added 178,000 jobs in May.

Upcoming on the economic calendar are reports on wholesale trade on June 11 and retail sales on June 13.

Be Sociable, Share!