Last Week the News - Economic Update

Last Week in the News

According to the ICSC-Goldman Sachs index, retail sales fell 0.2% for the week ending August 7. On a year-over-year basis, retailers saw sales increase 3.7%.

The Labor Department reported that in the second quarter productivity fell at an annual rate of 0.9%, labor costs rose at an annual rate of 0.2% and hours worked climbed at a 3.6% rate. This is a likely signal that employers have reached efficiency limits out of leaner staffs. In 2009, productivity rose 3.5%, the highest rate in six years.

Wholesalers increased their inventories 0.1% in June, following a 0.5% rise in May. Sales at the wholesale level fell 0.7% in June, the most since March 2009. Economists had anticipated inventories would increase 0.4% in June.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 6 increased 0.6%. Refinancing applications rose 0.6%. Purchase volume rose 0.3%.

The trade deficit increased 18.8% to $49.9 billion in June. It was the highest level since October 2008 and follows a $42 billion gap in May. Economists had expected the trade deficit to rise to $42.1 billion. Exports fell 1.3% to $150.5 billion. Imports increased 3% to $200.3 billion.

Initial claims for unemployment benefits rose by 2,000 to 484,000 for the week ending August 7. It was the highest level since mid February. Economist had projected claims would fall to 465,000. Continuing claims for the week ending July 31 fell by 118,000 to 4.45 million.

Upcoming on the economic calendar are reports on the housing market index on August 16, housing starts on August 17 and the index of leading economic indicators on August 19.