Economist's Commentary: August 15, 2008
Quick Take on the Economy: August 15, 2008
By George Ratiu
Industrial Production
- Industrial Production increased 0.2 percent in July, with mining and business equipment posting the strongest gains of 0.9 percent and 0.8 percent, respectively. On a yearly basis, production declined by 0.1 percent.
- Industrial Production for Consumer Goods increased 0.3 percent from June to July.
A slightly better than expected production raises GDP growth in the third quarter.
University of Michigan Sentiment Index
- The University of Michigan Survey of Consumers, released today, recorded a slight increase in its index of consumer confidence to 61.7 in early August.
- However, the current conditions index dropped to 69.3 in early August from 73.1 in late July. Sentiment ranking was a decline from May's ranking of 69.8. The reading was the lowest since 1980.
What does today's data mean for REALTORS® and consumers?
- July's industrial production numbers point to a slightly increased business optimism about the manufacturing sector.
- On the consumer side, while confidence improved slightly in early August due to lower gasoline prices, concerns about the overall economy are dampening consumers' mood.
Daily Forecast Update
- NAR's monthly official forecast as of August 7th (15K PDF)
- GDP Q3: 2.0%
- GDP Q4: 0.5%
- Unemployment rate by election time: 5.9%
- Average 30-year fixed mortgage rate in December: 6.7%
- Average 30-year fixed mortgage rate by mid-2009: 6.8%
- The next Fed policy change: a rate hike in December 2008
This is one in a series of commentaries by the Research staff of the National Association of REALTORS®. Read more commentaries >
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