New home sales slip while manufacturing improves


The economic news was mixed again Monday, with home sales unexpectedly dipping, while two reads of manufacturing showed expansion continued, but one suggested a slower rate of growth.

New single-family home sales fell 3.5% to a seasonally adjusted 959,000 annual rate from a downwardly revised 994,000, first reported as 1.011 million, the Commerce Department reported Monday.

Economists polled by IFR Markets expected a gain to 1.025 million sales.

Year-over-year, sales were up 32.1 % from the 726,000 homes sold in September 2019.

The median sales price rose to $326,800 from $322,400 in August, while the average price grew to $405,400 from $382,700.

At the end of September, 284,000 homes were on the market, a supply of about 3.6 months at the current pace of sales.

Separately, the Federal Reserve Bank of Dallas’ Texas Manufacturing Outlook Survey indicated expansion for the fifth straight month. The general business activity index rose to 19.8 in September from 13.6 in August, while the company outlook index gained to 17.8 from 14.9.

The production index climbed to 25.5 from 22.3, the capacity utilization index increased to 23.0 from 17.5, the new orders index gained to 19.9 from 14.7 and unfilled orders slipped to 4.1 from 6.0. Shipments grew to 21.9 from 21.5 and delivery times fell to 5.1 from 10.1. The employment index dropped to 8.7 from 14.5.

Looking six months ahead, the general business activity index crept to 28.4 from 28.0, while the company outlook slipped to 31.7 from 32.5, production dipped to 47.2 from 47.8, capacity utilization rose to 43.7 from 40.8, new order sank to 38.2 from 49.3, unfilled orders dropped to 3.9 from 15.3 and shipments declined to 37.9 from 41.4. The employment index slid to 23.1 from 23.3.

Elsewhere, the Federal Reserve Bank of Chicago’s National Activity Index slipped to 0.27 in September from 1.11 in August, indicating activity slowed, but remains slightly above average.

The CFNAI-MA33, the three-month moving average, fell to 1.33 in September from 3.22 a month earlier, while the diffusion index fell to 0.51 from 0.71.

While all but one of the four categories were positive in September, three of the four declined from the prior month’s reading. Sales, orders and inventories was the only positive contributor, while personal consumption and housing was the only one that improved in September.

Of the 85 individual indicators, 50 were positive in September and 35 made negative contributions; 40 posted better readings than in August, while 45 worsened. Of the 40 that improved, 12 still made negative contributions.

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