Economy Watch: Housing Starts Take a Dip in August
- Sep 19, 2014
The Census Bureau reported on Thursday that private housing starts in August came in at an annualized rate of 956,000 units, a drop of 14.4 percent compared with July, when the rate was more than 1.11 million units. Compared with the same month last year, however, housing starts were up 8 percent.
Most of the decline for the month was because of multifamily starts, which tend to yo-yo around. For properties with five units or more, the annualized start rate was 304,000 units, down 31.5 percent for the month. However, single-family starts were also down by 2.4 percent for the month, to an annualized rate of 643,000 units.
Building permits for residential construction dropped in August as well, to an annualized rate of 998,000 units, or 5.6 percent lower than in July, but 5.3 percent higher than a year ago. Permits are a more forward-looking indicator of the velocity of new residential construction.
Current-account deficit, Philly survey, initial unemployment claims
The Bureau of Economic Analysis reported this week that the U.S. current-account deficit—a net measure of transactions between the United States the rest of the world in goods, services, and income (such as investment income)—decreased to $98.5 billion in the second quarter of 2014 from $102.1 billion in the first quarter. The deficit decreased from 2.4 percent of GDP in the first quarter to 2.3 percent in the second quarter.
Separately, the Federal Reserve Bank of Philadelphia reported on Thursday that its General Business Conditions Index came in at 22.5 for September, down from 28.0 in August, but still quite strong. The index is a diffusion index of manufacturing conditions within the Philadelphia Federal Reserve district, and is an indicator of manufacturing-sector trends.
For the week ending Sept. 13, initial unemployment claims were 280,000, a decrease of 36,000 from the previous week, according to the U.S. Department of Labor on Thursday. That’s the lowest level for this particular metric in well over a decade. The four-week moving average was 299,500, a decrease of 4,750 from the previous four-week average.
Wall Street jumped again on Thursday, perhaps with a touch of Alibaba fever, but in any case the Dow Jones Industrial Average was up 109.14 points, or 0.64 percent. The S&P 500 advanced 0.49 percent and the Nasdaq gained 0.68 percent.