After a week of disappointing economic indicators, including sobering home sales and durable goods reports, as well as a downward revision to U.S. gross domestic product (GDP) in the second quarter, the American Chemistry Council's Economics and Statistics Group's running tab of positive indicators slipped by one to 12 out of 20. The ACC continues to fly a yellow-green banner to signal continued caution.
Existing home sales were off 27.2% from the most recent report, and were down 25.5% year over year despite record low interest rates; the rate on a 30-year mortgage dropping to 4.3%. New home sales fell by 12.4% to 276,000 units, and were off by 32.4% compared to year-ago figures. Existing home sales were at their lowest level in 15 years, with new home sales at a record low. The ACC noted that the slide coincides with the expiration of homebuyer tax credits, which "kicked the legs out from under a nascent housing recovery," adding that, "it is becoming clear that underlying demand for housing remains extremely weak."
The Bureau of Economic Analysis revised Q2 GDP downwards from its original estimate of 2.4% to 1.6% growth, well off the first quarter rate of expansion of 3.7%. Advanced durable goods actually ...