Economist's Commentary: June 3, 2008

Quick Take on the Economy: June 3, 2008

By Lawrence Yun, NAR Chief Economist

Factory Orders

  • Factory orders and shipments both rose quite strongly in April, by 1.1 percent and 2.2 percent, respectively. In March, both measures had also risen by better than one percent. Therefore, two straight months of solid performance says that the factories are humming and not idling.
  • Factory inventories were essentially unchanged. With thin inventory-to-sales ratio, there will be little drag on the economy from inventory adjustment going forward.

Chain Store Sales

  • Sales at major chains fell 0.8 percent. Sales are up by only 1.2 percent from a year ago.
  • Consumers are forced to hold back in light of rising food and energy prices and from declining asset values of homes and stocks.

What does today’s data mean for REALTORS® and consumers?

  • Mixed news with consumers holding back while business are ordering and shipping.
  • Consumer spending growth will be subpar for the foreseeable future – possibly for the next two years. A temporary lift in spending is expected in the second half as consumers use tax rebate checks.

Daily Forecast Update

  • NAR's monthly official forecast as of May 7th (PDF 15K)
  • GDP Q2: 1.2%
  • GDP Q3: 2.1% 
  • Unemployment rate by election time: 5.4%
  • Average 30-year fixed mortgage rate in June: 6.1%
  • Average 30-year fixed mortgage rate in December: 6.3%
    The next Fed policy change: a rate hike in January 2009.

Daily Forecast Update

  • NAR's monthly official forecast as of May 7th (PDF 15K)
  • GDP Q2: 1.1%
  • GDP Q3: 2.1%
  • Unemployment rate by election time: 5.5%
  • Average 30-year fixed mortgage rate in June: 6.2%
  • Average 30-year fixed mortgage rate in December: 6.3%
  • The next Fed policy change: a rate hike in January 2009.

This is one in a series of commentaries by the Research staff of the National Association of REALTORS®. Read more commentaries >

Comments? Questions? E-mail NAR Research.

NAR members, learn how you can add this commentary to your Web site, blog, or newsletter. Read more >



More Research Resources

 

Fast Facts

Nearly one-quarter of first-time buyers are single females who purchased their first home on a median income of $47,400.
Source: 2008 NAR Profile of Home Buyers and Sellers.


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