Last Week in the News

The index of leading economic indicators — designed to forecast economic activity in the next three to six months — rose a better-than-expected 1.1% in December after a revised 1% gain in November. It was the ninth straight monthly increase.

The Commerce Department reported that the combined construction of new single-family homes and apartments in December fell 4% to a seasonally adjusted annual rate of 557,000 units. However, applications for new building permits, seen as an indicator of future activity, jumped 10.9% to 653,000 units, the highest level since October 2008.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications for the week ending January 15 rose 9.1% to 575.9. Purchase volume increased 4.4% to 223. Refinancing applications jumped 11% to 2663.8.

The National Association of Home Builders/Wells Fargo housing market index fell one point in January to 15. It was the second monthly drop in the index and the lowest reading since June. An index reading below 50 indicates negative sentiment about the housing market.

The producer price index, which tracks wholesale price inflation, rose 0.2% in December, following a 1.8% increase in November. Economists had expected a gain of 0.1%.

Initial claims for unemployment benefits rose by 36,000 to 482,000 in the week ending January 16. Continuing claims for the week ending January 9 fell by 18,000 to 4.599 million.

Upcoming on the economic calendar are reports on existing home sales on January 25, the housing price index on January 26, new home sales on January 27 and gross domestic product on January 29.

Provided by:

Judy Haller

Prospect Mortgage

3985 Prince William Co. Pky., Suite 104

Woodbridge, VA 22192

Office: (703) 590-7132

Last Week in the News

The Commerce Department reported the trade deficit grew 9.7% to $36.4 billion in November from a revised $33.2 billion in October. Economists had expected the trade deficit to widen to $34.5 billion. Exports increased 0.9%, the seventh consecutive monthly gain. The growth in U.S. exports is an indication the global economy is beginning to rebound.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications for the week ending January 8 rose 14% to 528.1. Purchase volume increased 0.8% to 213.7. Refinancing applications jumped 21.8% to 2,407.2.

Retail sales unexpectedly fell 0.3% in December, following an upwardly revised 1.8% increase in November. Economists had anticipated retail sales to rise 0.4%. For the year, sales fell 6.2%, the largest decline since record keeping began in 1992.

Initial claims for unemployment benefits rose by 11,000 to 444,000 in the week ending January 9. Continuing claims for the week ending January 2 fell by 211,000 to 4.596 million.

The Labor Department reported consumer prices rose 0.1% in December. In 2009, consumer prices increased 2.7% after rising 0.1% in 2008.

Industrial production at the nation’s factories, mines and utilities increased 0.6% in December, following a revised 0.6% gain in November. The overall factory-operating rate rose to 72% of capacity in December from 71.5% in November.

Upcoming on the economic calendar are reports on the housing market index on January 19, housing starts on January 20, and the index of leading economic indicators on January 21.

Provided by:

Judy Haller

Prospect Mortgage

3985 Prince William Co. Pky., Suite 104

Woodbridge, VA 22192

Office: (703) 590-7132

Last Week in the News

The Institute for Supply Management reported the monthly index of manufacturing activity rose to 55.9 in December after reaching 53.6 in November. It was the fifth straight month of expansion and the fastest pace of growth since April 2006. A reading above 50 signals expansion.

The Commerce Department reported total construction spending fell 0.6% in November after dropping 0.5% in October. Economists had expected a decrease of 0.4%.

The Commerce Department reported factory orders rose 1.1% in November, more than double the 0.5% increase economists had anticipated. It was the seventh gain in the past eight months and follows a 0.6% increase in October.

The National Association of Realtors reported that its pending home sales index, a forward-looking indicator based on signed contracts, fell 16% in November, following a 3.7% increase in October. The decline was largely due to the tax credit for first-time homeowners that was set to expire but has since been extended and now includes move-up and repeat buyers.

The Labor Department reported that the unemployment rate was unchanged at 10% in December, even though employers cut 85,000 jobs. Payrolls for November were revised upward showing the economy gained 4,000 jobs. That was the first monthly gain since December 2007.

The Commerce Department said wholesalers increased their inventories by 1.5% in November. It was the biggest gain since October 2004. Economists had anticipated a 0.2% drop. Meanwhile, sales at the wholesale level rose 3.3% in November, marking the eighth straight monthly gain, and the largest increase since January 2008.

Upcoming on the economic calendar are reports on international trade on January 12, retail sales on January 14, and consumer inflation and industrial production on January 15.

Provided by:

Judy Haller

Prospect Mortgage

3985 Prince William Co. Pky., Suite 104

Woodbridge, VA 22192

Office: (703) 590-7132

Last Week in the News

The Standard & Poor’s/Case-Shiller 20-city housing price index rose a seasonally adjusted 0.4% in October. It was the fifth consecutive monthly gain and follows a 0.2% increase in September. The index is now up 3.4% from its bottom in May. On a year-over-year basis, the gauge was down 7.3% from October 2008 and down 29% below its peak in April 2006.

The Conference Board reported that its consumer confidence index rose to 52.9 in December from an upwardly revised 50.6 in November. Economists had expected a reading of 52. The index — which hit a record low of 25.3 in February — was benchmarked at 100 in 1985, a year chosen because it was neither a peak nor a trough in consumer confidence.

Initial claims for unemployment benefits fell by 22,000 to 432,000 in the week ending December 26. It was the lowest pace since July 2008. Continuing claims for the week ending December 19 fell by 57,000 to 4.98 million, the lowest level since February.

Upcoming on the economic calendar are reports on construction spending on January 4, pending home sales on January 5 and wholesale trade January 8.

Provided by:

Judy Haller

Prospect Mortgage

3985 Prince William Co. Pky., Suite 104

Woodbridge, VA 22192

Office: (703) 590-7132