MetroIntelligence Economic Update by P. DUFFY
July Global Composite Output Index rises to six-month high of 50.8
The J.P.Morgan Global Composite Output Index rose to a six-month high of 50.8 in July, up from 47.8 in June. This was the first time since January that the headline figure has posted above the neutral 50.0 mark. Five out of the six sub-sectors covered by the survey registered output growth during July, with the fastest rate of expansion seen at consumer goods producers.
U.S. services sector index rises another point to 58.1 in July
The Services PMI™ registered 58.1 percent in July, 1 percentage point higher than the June reading of 57.1 percent. This reading represents growth in the services sector for the second straight month after contraction in April and May, preceded by a 122-month period of expansion. Respondents remain concerned about the pandemic; however, they are mostly optimistic about business conditions and the economy as businesses continue to reopen. Sentiment varies across industries, as they are impacted differently.
Private sector jobs grew 167,000 in July, but economy still down 11.9 million jobs from March
ADP: Private-sector employment increased by 167,000 from June to July, on a seasonally adjusted basis. This compares to a gain of 4.3 million in June and 150,000 in July 2019. However, the recent gains in May and June are still far below the 19.4 million jobs lost in April. Even with the recent gain, there is still a net loss of 11.9 million jobs since March. We’ll get a fuller read on the job market on Friday, when the BLS releases their figures for July.
Weekly purchase mortgage applications dip 2 percent but rose 22 percent year-on-year
The Market Composite Index decreased 5.1 percent on a seasonally adjusted basis from one week earlier, with purchase loans falling 2 percent (but up 22 percent year-on-year) and refinance activity falling 7 percent (but up 84 percent year-on-year). The average contract interest rate for 30-year fixed-rate mortgages decreased to 3.14 percent from 3.20 percent.
CoreLogic: Home prices up 1.0% in June and 4.9% year-on-year
Nationally, home prices increased by 4.9 percent in June 2020, compared with June 2019. Month over month, home prices increased 1.0 percent, compared with May of this year, the fastest monthly gain for the month of June since 2013. CoreLogic’s HPI forecast predicts a modest decline of 1.0 percent in home prices over the twelve months ending June 2021.