MBA Purchase Applications Index 494.3
(Econoday.com) - The Mortgage Bankers purchase index keeps on rising, up 2.4 percent in the May 7th week to 494.3.
The index has risen for five straight weeks and is at a 6-month high. Higher interest rates may not be scaring away home buyers, who instead may be stepping up now before rates move yet higher.
But higher rates are definitely slowing refinancing, as the index fell another 13 percent to 2,184.6. The index has plunged by more than half since strong jobs data first appeared in early April.
Import Prices +0.2%
Export Prices +0.6%
(Econoday.com) - Import prices rose a mild 0.2 percent in April compared with March, showing little indication that the softer dollar is raising prices of imported goods.
Unlike March, petroleum prices, down 0.8 percent, drove down import prices. Excluding petroleum, import prices rose 0.3 percent with pressure centered in industrial supplies, reflecting sharp increases in metals prices.
Export prices rose more sharply, up 0.6 percent on the month with pressures once again centered in agricultural prices, which were up 2.6 percent and perhaps reflecting ongoing price increases for beef.
Excluding agriculture, export prices rose a less impressive 0.4 percent.
Trade Deficit -$46.0 Billion
(Econoday.com) - The nation's international trade deficit widened sharply in March to a record $46.0 billion, well above expectations and February's $42.1 billion gap.
Imports rose a sharp 4.6 percent to $140.7 billion against only a 2.6 percent rise in exports to $94.7 billion.
Imported petroleum was only partly to blame, with the petroleum goods gap at a record $12.5 billion vs. $11.1 billion in February. The price of imported oil averaged $30.64 per barrel, up $1.47 from February and the highest in 21 years!
Excluding petroleum, March's gap was still steep at $37.3 billion vs. $35.2 billion in the prior month. A doubling in civilian aircraft, always a volatile category, also pushed imports higher.
The results may cut into the first revision of first-quarter's 4.2 percent GDP pace, though the Commerce Department had assumed a sharp widening in the March trade gap in the advance report.
The gap aside, the rise in imports is in fact an indication of sharpening demand at home. Imports of autos, capital goods and consumer goods were all higher.
The export side is also showing strength, a reflection of the benefits of the softer dollar that has been slow to appear. Exports of autos and capital goods were higher, while exports for civilian aircraft were lower.
Note that some exports, such as for industrial supplies, benefited from higher prices, the result of high demand and scant availability of many metal products.
Country by country, the gap with China widened to $10.4 billion in the month and with Japan to $6.7 billion. The gap with the Euro Area widened to $7.4 billion (note that country balances are not seasonally adjusted).
5-Year Note Auction Yield Awarded 3.927%
(Econoday.com) - In strong results, the high yield for Wednesday's 5-year note auction came in at 3.927 percent, up nearly 71 basis points from last month and up 123 basis points from March!
Demand for the auction was solid despite the ongoing rise in interest rates. The bid-to-cover was a strong 2.64 vs. 2.28 last month, while the high yield was 2 basis points lower than the 5-year yield at bidding time.
But demand from central banks may have been limited as 34.6 percent of the auction was awarded to indirect bidders compared with 40-plus percentages in the prior two auctions (the indirect bidder category includes central banks).
Treasury Budget $17.6 Billion
(Econoday.com) - The U.S. Treasury announced a budget surplus of $17.6 billion in April after posting a sharp $72.7 billion deficit in March. The budget figures are not seasonally adjusted, but April typically sees a large surplus. Individual income taxes were 14.9 percent lower than a year ago for the same month. In contrast, corporate income taxes were 28.5 percent higher than last April. In any case, individual income tax receipts make up the lion's share of total receipts received by the government. Total receipts are 1.3 percent higher for the year-to-date period versus the same period last year. Outlays are up sharply relative to a year ago. Defense outlays are 14.5 percent higher than last April. Medicare and social security costs are also up from a year ago, but by a much smaller magnitude.
/Teresa
04.05.12 09:14 #