MetroIntelligence Economic Update by P. DUFFY
Existing home sales up another 4.3 percent in October and 26.6 percent year-on-year
Existing-home sales grew for the fifth consecutive month in October to a seasonally-adjusted annual rate of 6.85 million – up 4.3% from the prior month and 26.6% from one year ago. The median existing-home price was $313,000, almost 16% more than in October 2019. Total housing inventory declined from the prior month and one year ago to 1.42 million, enough to last 2.5 months – a record low – at the current sales pace. More than 7 in 10 homes sold in October 2020 – 72% – were on the market for less than a month.
Leading Economic Index rose at slower pace in October
The US Leading Economic Index rose 0.7 percent to 108.2 in October, with widespread improvements despite weakness from housing permits and consumers’ outlook on economic conditions. However, the leading index has been decelerating in recent months, which suggests growth will moderate significantly in the final months of 2020, slowing down from the unusually rapid pace in Q3. Furthermore, downside risks to growth from a second wave of COVID-19 and high unemployment persist.
Initial unemployment claims rebound 4.4 percent to 742,000, first rise in 5 weeks
In the week ending November 14, initial unemployment claims were 742,000, an increase of 31,000, or 4.4 percent, from the previous week’s revised level, and the first increase in five weeks. The advance number for seasonally adjusted insured unemployment during the week ending November 7 was 6,372,000, a decrease of 429,000, or 6.3 percent, from the previous week’s revised level. The total number of people claiming benefits in all programs for the week ending October 31 was 20,319,615, a decrease of 841,245, or 4.0 percent, from the previous week.
3Q20 e-commerce sales up 36.7 percent year-on-year versus 7.0 percent rise for all retail sales
U.S. retail e-commerce sales for the third quarter of 2020 fell 1.0 percent from the second quarter of 2020, while total retail sales rose 12.0 percent. Year-on-year, e-commerce sales rose 36.7 percent, while total retail sales rose 7.0 percent. The share of e-commerce sales in the third quarter of 2020 accounted for 14.3 percent of total sales, down from 16.1 percent in the second quarter, but up from 11.2 percent (or 3.1 percentage points) in the third quarter of 2019.
Index of Consumer Sentiment slips 2.13 points from prior week
The daily U.S. Index of Consumer Sentiment reads 88.51 as of Nov. 17, down 2.13 points from the prior week. The drop in confidence this past week primarily reflects the increase in the spread of the coronavirus across the United States. While the month isn’t over yet, the ICS in November is on pace to contract by 2% according to the month-to-date data.