A look behind at the April 20 week has relatively little data to digest. As has been the case in recent weeks, it was initial jobless claims that got the most attention. While levels remain at unprecedented highs, the pace of claims being filed has eased a bit. As of the end of the April 18 week, the unadjusted number of claims filed was down 697,173 to 4.267 million. Over the past five weeks, the cumulative number of new claims reached 24.379 million unadjusted. The data for insured claims in the week ended April 11 showed the rolls of those receiving benefits up to 16.439 million, a series high. There was also a series high of 11.3% in the unadjusted rate of insured unemployment. Even as the spate of new filings ebb, it remains to be seen how high the rolls go for continuing claims and where the insured rate of unemployment will peak. Also in question is how long these desperately elevated numbers linger.
Data for the housing market reflected to onset of measures to control the spread of COVID-19 with business closures and stay-at-home orders. The numbers were bad, but not so bad as likely to be seen in April. The huge wave of job losses didn’t really kick in until the latter half of March, so some sales were completed. However, after mid-month consumers essentially stopped home shopping unless highly qualified for a mortgage with good job security. Additionally, I think some of the March decline in sales can be attributed to an unusually active home buying period over the winter months that borrowed some activity from the spring. Sales of new single-family homes were down 15.4% to 627,000 (SAAR) in March after a strong 741,000 in February and 777,000 in January when the level was the highest since 778,000 in July 2007. There may simply have been depleted demand at play. Sales of existing homes were down 8.5% to 5.27 million units (SAAR).
Home prices have been a bit higher due to limited stock on hand, although that is also likely to change in April when sellers will be forced to make concessions while the ranks of buyers are thin. The FHFA House Price Index for February lags other data about housing prices. It registered a 0.7% month-over-month increase in February and was up 5.8% year-over-year, the best performance since January 2019.
Regional surveys for the manufacturing and service sectors both showed conditions suffered substantial downturns in April. Both sectors have clearly moved into recession along with the broader economy.
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