Friday Economic Snapshot: Spring brings warm news
As winter begins retracting its unusually sharp claws, we’ve seen a raft of economic data blowing in that suggests this past season did indeed have an outsized effect on North American economic activity, but that growth appears to be heating up.
In the last few days, we’ve got information suggesting the real estate market is cooling, auto sales are rebounding after a two-month dip, unemployment claims have fallen, Q4 GDP was revised up and consumer confidence has hit its highest level since January of 2008.
Spring break and consumer confidence are the macroeconomic equivalents of Corona and a slice of lime… Let’s test the waters.
After doing more than its fair share to boost economic output last year, auto sales declined in January and February. Now it looks like the “it’s the weather” argument may have been on point, as sales in February were at a seasonally adjusted annual rate (SAAR) of 15.3 million.
Kelley Blue Book is predicting an increase of 2 percent in March, putting the SAAR at 15.7 million, which is terrifically healthy for the post-recessionary auto market. J.D. Power and LMC Automotive went even further, forecasting a 7% increase for March — all of which bodes well for marine and powersports.
From S&P/Case-Shiller comes news that home prices edge upward in January, beating consensus expectations. The S&P/Case-Shiller index examines 20 American metro areas, and saw that those cities saw a 0.7 percent increase in January based on prices rising 13.2 percent year over year.
This data includes the nugget that prices are currently 23 percent higher than the market’s bottom-out in 2012. The report included a lot of talk about the wintry weather, with general optimism looking ahead.
For the week ending March 22, seasonally adjusted initial unemployment claims fell 10,000 to 311,000. This puts the 4-week moving average at 317,750, which is a decrease of 9,500 from the previous week’s revised average.
Zooming out, we are on the cusp of entering healthy territory not seen since the start of the new millennium. Let’s hope it translates into job and wage growth as the mercury continues to rise, because that’s still Job 1 for this economy.