Weekly Economic Update – March 1, 2010
This weeks economic news:
Monday
- No relevant economic data scheduled for release.
Tuesday
- No relevant economic data scheduled for release.
Wednesday
- The Fed Beige Book report to be released at 2:00 PM ET. It details economic activity throughout the country by region. The Fed relies heavily on this data during their FOMC meetings, so look for a potential reaction during afternoon trading. It probably will not cause a major sell off in the stock or bond markets, but could cause enough movement in bond prices to possibly improve or worsen mortgage rates slightly if it reveals any significant surprises.
Thursday
- The revised 4th quarter Productivity Index showed an upward revision to an annual rate of 6.7%. This was higher than the preliminary reading of last month and better than forecasts. That means that employees were more productive in quarter than thought, which is good news for bonds and mortgage rates. This is because the economy can grow easier without inflation concerns when productivity is high.
- January’s Factory Orders revealed a 1.7% increase in new orders for durable and non-durable goods. This was close to forecasts, but December’s orders were revised higher by 0.5%.
- The Labor Department reported that last week’s unemployment figure of 469,000 new claims for benefits were filed last week. This was a sizable drop from the previous week, but nearly matched forecasts. It also has not affected today’s mortgage pricing.
Friday
- The Labor Department reported that the U.S. unemployment rate remained at 9.7% last month when forecasts had called for a 0.1% increase. The number of jobs lost in the month came in at 36,000 when analysts were expecting a loss of 65,000 jobs. Both of these readings were negative for bonds and mortgage rates and positive for the stock markets since it paints less of a grim picture in the labor market as thought.
- Average hourly earnings reading that rose 0.1%. It was expected to show an increase of 0.2%, meaning income costs did not rise as much as thought. This is an indicator of wage inflation, so the lower the increase, the better for bonds.
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