WASHINGTON (6/18/13)--The Federal Reserve will release its most recent forecast of growth, inflation and unemployment at the conclusion of its Federal Open Market Committee (FOMC) monthly policy meeting today and Wednesday.
On average, private-sector economists predict the economy will grow 2.3% in 2013 and 2.8% in 2014, according to The Wall Street Journal's Monthly Survey. However, the Fed is more upbeat, forecasting roughly 2.6% growth this year and 3.2% next year, in its most recent growth projections (The Wall Street Journal June 17).
Although Fed officials are not expected to alter their $85-billion-per-month bond-buying program--launched to boost national growth by keeping long-term interest rates down and boosting asset prices--what they indicate about the economy will transmit key signals about what they likely will do in the future, the Journal said.
If the economy continues to show signs of improvement, the Fed could begin to cut the amount of monthly bond purchases in the next few months, Fed Chairman Ben Bernanke said in recent congressional testimony, the Journal noted.
News Now will provide coverage of the FOMC statement at the conclusion of its meeting Wednesday.
NEW YORK (6/17/13)--After reaching a six-year high in May, U.S. consumer confidence dipped in June to 82.7 from 84.5 in May, according to the Thomson/Reuters University of Michigan preliminary index of consumer sentiment.
The dip was a result of slipping household optimism regarding employment and housing, although the overall view of the U.S. economy by consumers remains positive (The New York Times and Bloomberg.com June 14).
June's reading still was the second highest in the past eight months, indicating U.S. citizens remain upbeat about long-term prospect for the economy, the Times said.
Even though the index's gauge of current economic expectations dropped to 92.1 from 98, an index component's measure of consumer expectations inched up to its highest level since November, to 76.7 from 75.8, the Times said.
WASHINGTON (6/14/13)--Initial claims for unemployment benefits in the U.S. declined last week, moving close to the lowest level in five years, the Labor Department announced Thursday.
Claims fell 12,000--to a seasonally adjusted 334,000--an indication of the U.S. labor market's resilience and steady progress in the market as well (The New York Times, The Wall Street Journal and Moody's Economy.com June 13).
The four-week moving average, which evens out the data's weekly volatility, declined 7,250--to 342,250.
Rising confidence in the recovery of the U.S. economy has induced American employers to depart from an extended cycle of elevated layoffs, the Times said.
Although the federal government's more stringent austerity measures this year do not appear to have increased layoffs, companies have been reluctant to accelerate hiring, and the U.S. unemployment rate is anticipated to finish the year above 7%, the Times added.
The weekly unemployment data suggest the U.S. economy will progress at a slow, steady pace in adding jobs, the Journal said.
WASHINGTON (6/13/13)--U.S. mortgage applications increased 5% from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending June 7.
The Market Composite Index, a measure of mortgage loan application volume, gained 5% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index rose 16%, compared with the previous week.
The Refinance Index went up 5% from the prior week. Despite the increase in the refinance index last week, the level is still 11% lower than two weeks prior and 36% below the recent peak at the beginning of May. The seasonally adjusted Purchase Index rose 5% from one week earlier. The unadjusted Purchase Index increased 14%, compared with the previous week and was 6% higher than the same week one year ago.
The refinance share of mortgage activity rose to 69% of total applications from 68% the previous week. The adjustable-rate mortgage share of activity increased to 7% of total applications. The Home Affordable Refinance Program share of refinance applications fell from 32% the prior week to 29%.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 4.15%--the highest rate since March 2012, from 4.07%, with points rising to 0.48 from 0.35--including the origination fee--for 80% loan-to-value ratio (LTV) loans.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) rose to 4.25%, the highest rate since May 2012, from 4.2%, with points increasing to 0.32 from 0.28--including the origination fee--for 80% LTV loans.
WASHINGTON (6/12/13)--The number of U.S. job openings dipped to 3.76 million in April from 3.88 million in March, according to the Job Openings and Labor Turnover Survey (JOLTS) released Tuesday by the Bureau of Labor Statistics.
Although hiring picked up in April, the dip in job openings indicates a likely weaker near-term outlook for jobs, JOLTS said (Moody's Economy.com June 1).
Also the job-openings rate decreased to 2.7% from 2.8%.
Meanwhile, hiring rose to 4.43 million from 4.22 million, while separations increased to 4.28 million from 4.12 million. That resulted in the economy still garnering a net jobs gain, JOLTS said.
More workers are quitting their jobs (separations), apparently because better positions are available, and layoffs are steadily falling, said Moody's in its analysis of JOLTS. Workers have more confidence to leave unsatisfying jobs, and they likely are earning more in new positions. As increasing number of workers leave their jobs voluntarily, new workers are filling the openings, Moody's explained.
However, the labor market still is relatively soft, and job creation remains too low to employ an adequate number of job seekers, Moody's said.
The near-term outlook suggests weak job gains through the end of 2013 because federal cutbacks will dampen the labor market through job cuts and through lower spending by furloughed workers. Also, weak worldwide demand will keep expansions in internationally connected industries in check. Hiring will improve by mid-2014, when net monthly job gains will begin to surpass 200,000, Moody's forecasts.
WASHINGTON (6/11/13)--One bank closed Friday, which brings this year's total of failed U.S. banks to 16, the Federal Deposit Insurance Corp. announced Friday.
The National Credit Union Administration has closed nine banks so far this year.
Mountain National Bank, Sevierville, Tenn., was closed and assumed by First Tennessee Bank, N.A., Memphis, Tenn.
As of March 31, Mountain National Bank had roughly $437.3 million in total assets and $373.4 million in total deposits.
The cost to the Deposit Insurance Fund will be $33.5 million, the FDIC estimated.
WASHINGTON (6/10/13)--The Federal Deposit Insurance Corp. announced one bank closing Thursday, which brings this year's total of failed U.S. banks to 15.
That compares with nine credit union closings so far this year by the National Credit Union Administration.
1st Commerce Bank, North Las Vegas, Nev., was closed and will be assumed by Plaza Bank, Irvine, Calif., the FDIC said.
1st Commerce Bank, as of March 31, had roughly $20.2 million in total assets and $19.6 million in total deposits. The FDIC estimates the cost of the closure to its deposit insurance fund to be $9.4 million.