by Calculated Risk on 4/05/2025 08:11:00 AM
Saturday, April 05, 2025
Schedule for Week of April 6, 2025
The key economic report this week is March CPI.
No major economic releases scheduled.
6:00 AM ET: NFIB Small Business Optimism Index for March.
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.
2:00 PM: FOMC Minutes, Meeting of March 18-19
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for 225 initial claims up from 219 thousand last week.
8:30 AM: The Consumer Price Index for March from the BLS. The consensus is for 0.1% increase in CPI (up 2.6% YoY) and a 0.3% increase in core CPI (up 3.0% YoY).
8:30 AM: The Producer Price Index for March from the BLS. The consensus is for a 0.2% increase in PPI, and a 0.3% increase in core PPI.
10:00 AM: University of Michigan's Consumer sentiment index (Preliminary for April).
Friday, April 04, 2025
April 4th COVID Update: COVID Deaths Continue Declining
by Calculated Risk on 4/04/2025 07:56:00 PM
Note: Mortgage rates are from MortgageNewsDaily.com and are for top tier scenarios.
COVID Metrics | ||||
---|---|---|---|---|
Now | Week Ago | Goal | ||
Deaths per Week | 576 | 655 | ≤3501 | |
1my goals to stop weekly posts. 🚩 Increasing number weekly for Deaths. ✅ Goal met. |
This graph shows the weekly (columns) number of deaths reported since Jan 2023.
Asking Rents Mostly Unchanged Year-over-year
by Calculated Risk on 4/04/2025 02:36:00 PM
Today, in the Real Estate Newsletter: Asking Rents Mostly Unchanged Year-over-year
Brief excerpt:
Another monthly update on rents.This is much more in the article.
Tracking rents is important for understanding the dynamics of the housing market. Slower household formation and increased supply (more multi-family completions) has kept asking rents under pressure. ...
Apartment List: Asking Rent Growth -0.4% Year-over-year ...
On the supply side of the rental market, our national vacancy index now sits at 6.9 percent, the highest reading in the history of that monthly data series, which goes back to the start of 2017. After a historic tightening in 2021, multifamily occupancy has been slowly but consistently easing for over three years amid an influx of new inventory. 2024 saw the most new apartment completions since the mid-1980s, and with 750 thousand units still in the construction pipeline, the supply boom has runway to continue this year.Realtor.com: 19th Consecutive Month with Year-over-year Decline in RentsThe median asking rent across the 50 largest metropolitan areas in the United States fell again in February, to $1,691. This marks 19 months in a row in which rent has fallen year over year, this time by 0.9% from February 2024.
Q1 GDP Tracking: Near Zero Growth
by Calculated Risk on 4/04/2025 01:12:00 PM
From BofA:
Since our last publication, our 1Q GDP tracking is up from 0.1% q/q saar to 0.4% q/q saar. [Apr 4th estimate]From Goldman:
emphasis added
We left our Q1 GDP tracking estimate unchanged at +0.3% (quarter-over-quarter annualized). [Apr 3rd estimate]
The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2025 is -2.8 percent on April 3, up from -3.7 percent on April 1. The alternative model forecast, which adjusts for imports and exports of gold as described here, is -0.8 percent. [Apr 3rd estimate]
Fed Chair Powell: "Tariff increases will be significantly larger than expected"', Expect "higher inflation and slower growth"
by Calculated Risk on 4/04/2025 11:25:00 AM
From Fed Chair Jerome Powell: Economic Outlook. Excerpt:
Turning to monetary policy, we face a highly uncertain outlook with elevated risks of both higher unemployment and higher inflation. The new Administration is in the process of implementing substantial policy changes in four distinct areas: trade, immigration, fiscal policy, and regulation. Our monetary policy stance is well positioned to deal with the risks and uncertainties we face as we gain a better understanding of the policy changes and their likely effects on the economy. It is not our role to comment on those policies. Rather, we make an assessment of their likely effects, observe the behavior of the economy, and set monetary policy in a way that best achieves our dual-mandate goals.
We have stressed that it will be very difficult to assess the likely economic effects of higher tariffs until there is greater certainty about the details, such as what will be tariffed, at what level and for what duration, and the extent of retaliation from our trading partners. While uncertainty remains elevated, it is now becoming clear that the tariff increases will be significantly larger than expected. The same is likely to be true of the economic effects, which will include higher inflation and slower growth. The size and duration of these effects remain uncertain. While tariffs are highly likely to generate at least a temporary rise in inflation, it is also possible that the effects could be more persistent. Avoiding that outcome would depend on keeping longer-term inflation expectations well anchored, on the size of the effects, and on how long it takes for them to pass through fully to prices. Our obligation is to keep longer-term inflation expectations well anchored and to make certain that a one-time increase in the price level does not become an ongoing inflation problem.
emphasis added
Comments on March Employment Report
by Calculated Risk on 4/04/2025 09:14:00 AM
The headline jobs number in the March employment report was above expectations, however, January and February payrolls were revised down by 48,000 combined. The participation rate increased, the employment population ratio was unchanged, and the unemployment rate increased to 4.2%.
Prime (25 to 54 Years Old) Participation
The 25 to 54 years old participation rate decreased in March to 83.3% from 83.5% in February.
Average Hourly Wages
Wage growth has trended down after peaking at 5.9% YoY in March 2022 and was at 3.8% YoY in March.
Part Time for Economic Reasons
"The number of people employed part time for economic reasons, at 4.8 million, changed little in March. These individuals would have preferred full-time employment but were working part time because their hours had been reduced or they were unable to find full-time jobs"The number of persons working part time for economic reasons decreased in March to 4.78 million from 4.94 million in February. This is above the pre-pandemic levels.
These workers are included in the alternate measure of labor underutilization (U-6) that decreased to 7.9% from 8.0% in the previous month. This is down from the record high in April 2020 of 22.9% and up from the lowest level on record (seasonally adjusted) in December 2022 (6.6%). (This series started in 1994). This measure is above the 7.0% level in February 2020 (pre-pandemic).
Unemployed over 26 Weeks
According to the BLS, there are 1.46 million workers who have been unemployed for more than 26 weeks and still want a job, up from 1.44 million the previous month.
This is above pre-pandemic levels.
Job Streak
Headline Jobs, Top 10 Streaks | ||
---|---|---|
Year Ended | Streak, Months | |
1 | 2020 | 113 |
2 | Current, N/A | 511 |
3 | 1990 | 48 |
4 | 2007 | 46 |
5 | 1979 | 45 |
6 tie | 1943 | 33 |
6 tie | 1986 | 33 |
6 tie | 2000 | 33 |
9 | 1967 | 29 |
10 | 1995 | 25 |
1Currrent Streak |
Summary:
The headline jobs number in the March employment report was above expectations, however, January and February payrolls were revised down by 48,000 combined. The participation rate increased, the employment population ratio was unchanged, and the unemployment rate increased to 4.2%.
March Employment Report: 228 thousand Jobs, 4.2% Unemployment Rate
by Calculated Risk on 4/04/2025 08:30:00 AM
From the BLS: Employment Situation
Total nonfarm payroll employment rose by 228,000 in March, and the unemployment rate changed little at 4.2 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care, in social assistance, and in transportation and warehousing. Employment also increased in retail trade, partially reflecting the return of workers from a strike. Federal government employment declined.
...
The change in total nonfarm payroll employment for January was revised down by 14,000, from +125,000 to +111,000, and the change for February was revised down by 34,000, from +151,000 to +117,000. With these revisions, employment in January and February combined is 48,000 lower than previously reported.
emphasis added
The first graph shows the jobs added per month since January 2021.
Payrolls for January and February were revised down by 48 thousand, combined.
In March, the year-over-year change was 1.88 million jobs. Employment was up solidly year-over-year.
The third graph shows the employment population ratio and the participation rate.
The Employment-Population ratio was unchanged at 59.9% from 59.9% in February (blue line).
I'll post the 25 to 54 age group employment-population ratio graph later.
The unemployment rate increased to 4.2% in March from 4.1% in February.
This was above consensus expectations; however, January and February payrolls were revised down by 48,000 combined.
Thursday, April 03, 2025
Friday: Employment Report, Fed Chair Powell Speaks
by Calculated Risk on 4/03/2025 08:08:00 PM
Note: Mortgage rates are from MortgageNewsDaily.com and are for top tier scenarios.
Friday:
• At 8:30 AM ET, Employment Report for March. The consensus is for 135,000 jobs added, and for the unemployment rate to be unchanged at 4.1%.
• At 11:25 AM, Speech, Fed Chair Jerome Powell, Economic Outlook, At the Society for Advancing Business Editing and Writing (SABEW) Annual Conference, Arlington, Virginia
March Employment Preview
by Calculated Risk on 4/03/2025 04:27:00 PM
On Friday at 8:30 AM ET, the BLS will release the employment report for March. The consensus is for 135,000 jobs added, and for the unemployment rate to be unchanged at 4.1%.
From Goldman Sachs:
We estimate nonfarm payrolls rose by 150k in March, slightly above consensus ... We estimate that the unemployment rate was unchanged on a rounded basis at 4.1%.From BofA:
emphasis added
Nonfarm payrolls are likely to increase by a robust 185k in March, higher than consensus expectations of 135k, due to payback in leisure & hospitality for cold weather in Jan and Feb. Government job growth is expected to come in at just 10k due to the federal hiring freeze/DOGE. Given the muted claims data in the survey week, we do not expect DOGE driven job cuts to be a sizable drag, although risks are to the downside. We expect the u rate to remain at 4.1%.• ADP Report: The ADP employment report showed 155,000 private sector jobs were added in March. This was above consensus forecasts and suggests job gains above consensus expectations, however, in general, ADP hasn't been very useful in forecasting the BLS report.
• ISM Surveys: Note that the ISM indexes are diffusion indexes based on the number of firms hiring (not the number of hires). The ISM® manufacturing employment index decreased to 44.7%, down from 47.6% the previous month. This would suggest about 50,000 jobs lost in manufacturing. The ADP report indicated 21,000 manufacturing jobs added in March.
The ISM® services employment index decreased to 46.2%, from 53.5%. This would suggest 30,000 jobs lost in the service sector. Combined this suggests 80,000 jobs added, well below consensus expectations. (Note: The ISM surveys have been way off recently)
• Unemployment Claims: The weekly claims report showed about the same initial unemployment claims during the reference week at 225,000 in March compared to 224,000 in February. This suggests layoffs in March were about the same as in February.
Hotels: Occupancy Rate Increased 4.4% Year-over-year (Easter Timing boosted YoY Occupancy)
by Calculated Risk on 4/03/2025 03:35:00 PM
On the positive side of the Easter calendar shift, the U.S. hotel industry reported increases across the key performance metrics, according to CoStar’s latest data through 29 March. ...The following graph shows the seasonal pattern for the hotel occupancy rate using the four-week average.
23-29 March 2025 (percentage change from comparable week in 2024):
• Occupancy: 65.1% (+4.4%)
• Average daily rate (ADR): US$161.65 (+2.5%)
• Revenue per available room (RevPAR): US$105.19 (+7.0%)
emphasis added
The red line is for 2025, blue is the median, and dashed light blue is for 2024. Dashed purple is for 2018, the record year for hotel occupancy.