Inflation, GDP, & Some Spooky Housing Stats

Week in Review: Oct. 24-28

There was actually some good economic news this week, though it didn’t start out that way. So let’s get right to . . .

Monday

S&P Global Flash U.S. Indices

These diffusion indices suggest that private sector business activity contracted in October. Service sector activity fell pretty sharply. Manufacturing output edged higher due to improving supply chains, but new orders fell and “the decrease in client demand was solid and the sharpest since May 2020.” If you think about it, this portends lower inflation as supply side dynamics improve while demand crumbles.

Tuesday

Conference Board Consumer Confidence Index

This consumer confidence measure deteriorated in October, ending a two-month streak of improving confidence (likely due in large part to falling gasoline prices). As has been the case for a few months now, consumers feel meaningfully better about the present situation than about the future. That said, the Present Situation Index fell more in October than the Expectations Index.

Home Price Indices

The S&P CoreLogic Case-Shiller Index and the FHFA U.S. House Price Index both indicate that home prices fell about 1% in August (yes, these indicators are published with a lag), but are still up 12-13% year over year.  Home value declines have begun, and mortgage rates keep on rising.

Don’t worry, the good economic news is coming, but just not on . . .

Wednesday

New Home Sales