REUTERS/Mike BlakeA country music fan cools off in the wind on the second day of the Stagecoach country music festival in Indio, California April 26, 2014.
Here’s a quick preview of this morning’s big economic reports via the Monday Scouting Report:
- GDP (Thurs): Economists estimate Q1 GDP growth was revised down to -0.5% from an earlier estimate of 0.1%. Personal consumption is expected to be revised up to 3.1% from 3.0%. Here’s Goldman Sachs’ Jan Hatzius: “The first-quarter disappointment has resonated among economists and market participants for two reasons. First, it brings to mind the 2011 precedent, and more broadly the repeated downside surprises on growth in recent years. Second, it comes in the wake of the debate around “secular stagnation” that was kicked off by the speech by Lawrence Summers at the November 2013 IMF research conference. If the US economy cannot accelerate to a clearly above-trend pace even after the end of the private and public sector retrenchment at a time when monetary policy and financial conditions still look very supportive, then it is certainly appropriate to ask whether the forces holding the economy back are deeper and more structural in nature. In that sense, it is really ‘showtime for the recovery’ … ”
- Initial Jobless Claims (Thurs): Economists estimate claims fell to 318,000 from 326,000 last week. “Still, first filings over the last three months have averaged 320,000, providing little information about the direction of the labour market,” said Citi’s Peter D’Antonio. “In contrast, the story for beneficiaries has been unambiguously better. We forecast another drop in this figure, which would keep the insured rate at 2.0% for a fourth week. Since the beginning of the year, continuing claims have fallen by more than 200,000 and recent readings point to further improvement in the labour market ahead.”
- Pending Home Sales (Thurs): Economists estimate pending sales climbed 1.0% in April. “We look for pending home sales, which track signed contracts on single-family homes, condos, and co-ops, to rise 2.0% m/m in April to 96.2,” said Barclays’ economists. “Factors in our forecast are MBA applications for purchase, which rose 4.7% on the month, and buyer traffic in the NAHB home index, which rose to 32 in April from 31 in March. Improvement in both inputs is likely driven by better weather, and suggests upward momentum.”
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