Haver’s data services are provided through the DLX platform; delivering tools for data management, visualization, modeling and publishing. DLX is designed to increase productivity and integrates with Excel, PowerPoint, and major statistical software packages; MatLab, R, Python, SAS, E-views and Stata. DLX component application DLXVG3 offers precision graphics, publishing, analytic tools, and easy navigation for all Haver databases.

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Chart and compare multiple data series with accompanying data table of values

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Excel and PowerPoint direct export and complete integration (dynamic spreadsheets and presentations update on a click)

DLXVG3

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DLX Add-ins for all versions of Excel provide instant data updates of entire workbooks

Use DLXVG3 to locate data series codes from within any file, easily creating new spreadsheets for analysis

Edit date ranges, archive data, apply functions

Excel Spreadsheet Add-ins

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Haver offers timely, accurate, and professionally supported data via an update service, meeting the strictest demands of the institutional research community

AutoUpdate provides fast and reliable data updates within seconds of source releases

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Manual updates offer clients the independence to update data retrievals on any desired schedule

All database updates retrieve only the data series that have changed and send only the data points that have been updated; including revisions

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Haver supports a DLX API permitting clients to leverage and build processes with DLX data

Database Compatibility

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Data Link Express

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HaverView

[Matlab](http://matlab.com) by The MathWorks lets you access, visualize, and analyze historic time-series data to identify patterns or uncover complex relationships. From within a single environment you can:

- Access data from multiple sources including files, spreadsheets, databases, data providers, and the Web
- Store data in financial time-series objects to simplify data management, data transformation, missing-data handling, and date-math calculations
- Perform technical analysis with moving averages, oscillators, stochastics, and indices
- Create custom analysis routines and visualizations or animations to capture, present, and share your analysis processes and discoveries
- Customize your analysis environment with advanced functionality from signal processing, statistics, or econometrics

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MATLAB

[Stata Data Analysis and Statistical Software](https://www.stata.com) by StataCorp LP is an integrated statistical package designed for researchers of all disciplines. It provides the ability to do data analysis, data management and graphics and has features such as multiple imputation, factor variables, GMM, competing-risks regression, state-space modeling, predictive margins, and more.

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Stata

[SAS](https://www.sas.com) provides an integrated environment for predictive and descriptive modeling, data mining, text analytics, forecasting, optimization, simulation, experimental design and more. From predictive analytics to model deployment and process optimization, SAS provides a range of techniques and processes for the collection, classification, analysis and interpretation of data to reveal patterns, anomalies, key variables and relationships, leading ultimately to new insights and better answers faster.

[SASEHAVR](http://support.sas.com/documentation/cdl/en/etsug/67525/HTML/default/viewer.htm#etsug_sasehavr_gettingstarted01.htm) is a seamless interface between Haver and SAS data processing that enables SAS users to read economic and financial time series data that reside in a Haver Analytics DLX (Data Link Express) database. [SASEHAVR](http://support.sas.com/documentation/cdl/en/etsug/67525/HTML/default/viewer.htm#etsug_sasehavr_gettingstarted01.htm) requires both SAS/ETS and Base SAS Software.

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[RATS (Regression Analysis of Time Series) Econometric Software](https://estima.com) by Estima is a leading econometrics and time-series analysis software package. It provides ability to do linear and non-linear least squares, forecasting, SUR and ARIMA models and in addition, supports advanced techniques such as GMM, ARCH and GARCH models, state space models, and more.

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RATS

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Visualization with GGPlot2 and data analysis

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Session 3: Univariate Models Part 1

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Session 6: Cointegration and error-correction models

A popular open source option for statistical computing and graphics that is available on many UNIX platforms, Windows and MacOS

Estimating, evaluating, and forecasting ARIMA models

Understanding the concept of non-stationarity and testing for unit roots

Estimating autoregressions, granger causality tests, and impulse response functions

Understanding the concept of cointegration and testing using the Enger-Granger test

Estimating and forecasting with vector error correction models

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Teaches econometrics and forecasting at the University of Colorado Denver. He has over 15 years of econometric experience in both the private and public sector.

Daniel L. Jerrett, Ph.D.

Abdel M. Zellou, Ph.D.

Bootcamp and Econometric Tools 1 & 2

Econometrics Training: Applied Time Series in R

Session 5: Multivariate Models Part 1

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Haver partners with SmartMacro Labs to offer a two week immersive online course introducing participants to the power of the Python programming language. This applied hands-on training develops statistical economics skills with a concentration on economics and finance.

Gain proficiency in building modern time-series models in Python through real-world applications. Designed for professionals in both the public and private sector, the course does not require prior experience, assuming only that participants have a basic understanding of regression and statistical concepts.

Proficiency working in Jupyter notebooks and the Python environment

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Remote Training: Applied Time Series in Python

Benchmark revision shows less worrisome US inflation

Andrew Cates

**One Direction**
The October Blue Chip Financial Forecasts survey marks a shift in tone more than in central expectation. Growth is still holding up and recession is not what the panel expects, though the probabilities attached to Europe remain well above those for the United States. What has changed is the inflation side of the balance. A large majority of panelists now regard inflation as the greater risk (compared with growth), in the US and beyond it, and twelve-month interest-rate paths have been revised up accordingly. Japan has become a more prominent part of the global tightening story, with its policy rate now expected to move furthest over the coming year. The Bank of England is expected to move least. But the direction of travel is the same everywhere, and that is itself a change from the survey compared with a few months ago.

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**Hiring for the Machine**
Demand for artificial-intelligence skills has spread well beyond the economies most closely associated with the technology. Canada stands out, with the share of job postings mentioning AI now roughly double the UK’s and well above the American figure. That comparison requires care. Because these are shares of total vacancies, the gap may reflect faster growth in non-AI postings in the United States, rather than stronger absolute demand for AI skills in Canada. Differences in the composition of vacancies also matter, while postings measure hiring intentions rather than actual employment. Even so, the prevalence of AI-related vacancies outside the United States suggests that the technology’s diffusion is not confined to the economies attracting the most investment.

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**A Favourable Combination**
World industrial production has been accelerating through the first half of this year while core consumer price inflation across the G7 has continued to drift lower. A demand-led expansion would not usually produce that combination; it would push both series the same way. Starting positions matter here. Output is accelerating from a weak base, so the growth rates flatter the recovery in levels, and inflation has been falling from a rate that sat well above most central bank targets. Nor are the two measures strictly comparable. Industrial production captures a narrow and unusually cyclical slice of activity, while core inflation excludes the energy costs that have done most to unsettle markets this year. The timing is also ambiguous, since prices respond to activity with a lag long enough that the recent divergence may yet close. Still, a more natural reading could be that effective supply has been improving, whether through fuller use of existing capacity or early returns on the investment now under way.

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**The Capex Cycle Has Turned**
Real capital goods orders across the United States, Germany and Japan have now been rising for well over a year, and annual growth is close to its strongest since the post-pandemic rebound. Composition matters as much as the growth rate. Data centres and the electrical equipment that serves them account for part of it, but so do defence programmes, grid investment and the reshoring of supply chains, which are being driven by security considerations and are correspondingly insensitive to the cost of capital. In volume terms, orders remain below their 2021 levels, which suggests a cycle that is established but not yet mature. Upswings of this kind have historically run for several years once they take hold.

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**Pay Without Pressure**
Pay growth has roughly halved since 2023 in the United States, the euro area and the United Kingdom, three labour markets with very different bargaining structures and degrees of centralisation. That common path is striking, and it has been achieved without a sharp rise in unemployment. The temptation is to credit restrictive monetary policy, but the absence of any material loosening in employment argues against it. A demand-restraint channel operating with this much force should have left a clearer mark on jobs. The simpler explanation is that pay was catching up with an inflation shock and has fallen back as that shock has faded, helped by a recovery in labour supply and by an adjustment that has run through vacancies rather than through headcount. Whatever the cause, the consequence is the same. Where firms are producing more without employing proportionately more people, unit labour costs fall, margins hold and the inflationary consequences of resilient demand are muted. That is the condition on which the current configuration rests, and it is the first thing that would change were capacity to become binding.

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**The Price of Power**
Industrial electricity prices in the Middle Atlantic region in the United States, where data centre capacity is most heavily concentrated, have pulled steadily further away from those in Texas over the past two years. A regional premium is not evidence of a national energy shortage, and such differences have always existed. What it does perhaps indicate is where the physical limits bite first. Digital capital can be installed in months; generating plant, transmission lines and grid connections cannot, and the permitting queues are long. Should the cost of power in the places where the boom is being built keep rising faster than elsewhere, the productivity gains will be absorbed by the energy bill rather than showing up in lower costs or wider margins. The favourable part of this expansion is real enough. But it is a phase, and the grid is where its limits will be tested first.

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Long-dated US Treasury yields climbed again this week to levels last seen before the financial crisis. Crude oil prices in the meantime eased into the quarter-end as Middle Eastern exports recovered, though Brent will still likely close September higher than it began, and equity markets have absorbed the move in bonds without much difficulty. Forecasters have followed these market moves rather than resisted them. The latest Blue Chip Financial Forecasts survey suggest that policy rates are now expected to be higher in twelve months' time in every major economy, with Japan moving furthest and the United Kingdom least (chart 1). The difficulty is that this repricing is taking place against a world economy that is arguably performing better than a tightening cycle would ordinarily permit. Demand for artificial-intelligence skills is rising in labour markets well beyond the United States (chart 2), world industrial output has accelerated even as core inflation across the G7 has fallen (chart 3), and capital goods orders across the G3 have turned decisively higher (chart 4). Wage growth has slowed in three very different labour markets of late without the increase in unemployment that earlier disinflations demanded (chart 5). Such a combination is rare, and it rests on conditions that may not hold. The constraint that eventually binds could be more physical than monetary, and it is already apparent in the cost of electricity in the regions where the data centres are being built (chart 6).

<iframe data-testid="embed-iframe" style="border-radius:12px" src="https://open.spotify.com/embed/episode/2E7CHyGsnrnJU7kh3mbsMA?utm_source=generator&si=4610e15573454d9c" width="100%" height="152" frameBorder="0" allowfullscreen="" allow="autoplay; clipboard-write; encrypted-media; fullscreen; picture-in-picture" loading="lazy"></iframe>

Charts of the Week: A Benign Phase

Winnie Tapasanun

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The ISM U.S. manufacturing PMI unexpectedly dipped to 54.5 in September from 54.6 in August and 55.6 in July, according to data from the Institute for Supply Management. The September reading, above the 50 expansion-contraction threshold, indicated the U.S. manufacturing sector expanded for the ninth consecutive month, albeit at a marginally slower pace. A reading of 55.0 for September had been expected in the Action Economics Forecast Survey. The latest manufacturing PMI, while above a contractionary 48.9 in September 2025 and a low of 47.0 in October 2024, remained below a peak of 63.8 in March 2021.

The production index declined to 56.7 in September from 58.3 in August, indicating production expanded for the 11th straight month but at the slowest rate since June. The index was above a low of 44.8 in April 2025 but below a peak of 66.5 in March 2021. In September, 25.4% (NSA) of respondents reported higher production while 11.9% reported lower production. The new orders index rebounded to 55.3 in September from 53.7 in August (the lowest reading since March), signaling new orders grew for the ninth consecutive month following four successive months of contraction. The index remained well above a low of 41.8 in January 2023 but below a high of 67.0 in May 2021. In September, 23.4% (NSA) of respondents reported higher new orders while 15.5% reported declines. The inventories index fell further to 48.6 in September—the first contraction since May and the lowest level since March—from 50.6 in August, returning to the broader contractionary trend in place since May 2025. The index was below a high of 52.7 in March 2025 but above a low of 43.8 in October 2024. Meanwhile, the supplier deliveries index edged down to 59.0 in September from 59.3 in August, indicating slowing delivery performance for the 10th straight month after faster deliveries in November 2025. In September, 21.4% (NSA) of respondents reported slower delivery speeds while 3.4% reported faster speeds.

On the labor front, the employment index rebounded to 52.7 in September from 51.2 in August, showing employment expanded for the third consecutive month, at a stronger pace, following 33 months of contraction. The index was above a low of 44.1 in November 2025 but below a high of 56.5 in March 2022. In September, 15.3% (NSA) of respondents reported higher employment while 14.5% reported lower hiring.

On the pricing front, the prices paid index advanced to 77.9 (NSA) in September from 71.1 in August and 71.1 in July, indicating raw materials prices rose for 24 months running and at the fastest rising pace since May. The index remained well above a low of 39.4 in December 2022 but below a high of 87.1 in March 2022 and a peak of 92.1 in June 2021. In September, 58.6% (NSA) of respondents reported higher prices while only 2.8% reported price declines.

In other ISM series not included in the composite index, the new export orders index decreased to 50.9 in September from 53.2 in August, indicating new export orders grew for the fourth time in five months, albeit at the lowest level since June’s contractionary 48.5. The index was up from a low of 40.1 in May 2025 but down from a peak of 57.1 in February 2022. The imports index slipped to 51.0 in September from 52.5 in August, suggesting imports expanded for the eighth successive month but at the weakest rate since April. The index was above a low of 39.9 in May 2025 but below a peak of 61.0 in June 2021. The order backlog index climbed to 56.4 (NSA) in September from 51.8 in August, showing backlog levels grew for the ninth straight month and at the fastest pace since February’s high of 56.6. The index was well above a low of 37.5 in May 2023 but below a peak of 70.6 in May 2021.

The ISM figures are based on responses from over 400 purchasing and supply executives from 18 industries, which are weighted according to each industry’s contribution to GDP. These data are diffusion indexes where a reading above 50 indicates expansion; below 50 indicates contraction. The ISM Manufacturing PMI is a composite index based on the diffusion indexes of five of the indexes (seasonally adjusted) with equal weights: New Orders, Production, Employment, Supplier Deliveries, and Inventories. The figures from the Institute for Supply Management can be found in Haver’s **USECON** database; further detail is found in the **SURVEYS** database. The expectations number is available in Haver’s **AS1REPNA** database.

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- ISM Mfg. PMI down slightly to 54.5 in Sept.; ninth straight month of expansion.
- Production (56.7) lowest since June; still expanding for the 11th consecutive mth.
- New orders (55.3) growing at a faster pace; ninth successive mth. above 50.
- Employment (52.7) expanding for the third straight mth., at a faster rate, after 33 mths. of contraction.
- Prices Index (77.9) highest since May, indicating prices rising for 24 mths. running.
- Exports (50.9) lowest since June and imports (51.0) lowest since April; both still expanding.

U.S. ISM Manufacturing PMI Still Expansionary in September; New Orders & Employment Accelerating; Production Moderating

Jonathan Basile

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The U.S. Construction Spending report revealed total construction spending rose 0.9% month-over-month (MoM) in August following a 0.1% monthly decline in July. Over the last three months, nominal construction spending advanced at a 6.6% annualized rate, the best showing on this basis since March 2024. Near-term performance also pushed the six-month trend into positive territory (1.2% annualized) for the first time since February 2025. Recent traction, however, has not pulled the smoother year-over-year (YoY) rate out of the red. August’s -1.7% YoY figure extended the negative streak to 13 months.

Private construction (up 1.1% MoM, -3.1% YoY) accounted more of the headline advance than public construction (up 0.2% MoM). Half of the private construction gain was driven by home improvements (up 2.5% MoM). This component of residential construction has been volatile this year, so the sequential improvement is not an all-clear signal. In fact, home improvements’ August level is still about 8% below the 2026 high point (in March) and nearly 10% below the September 2025 cycle top.

Data centers drive one-third of private construction’s August increase on another strong monthly showing (up 7.5% MoM). The extraordinary AI-related expansion pushed the annual trend to a 73.2% YoY rate. Moreover, the data center share of private construction rose above 5% in August for the first time ever. The progression over the last three Augusts revealed a 1% share in 2023, a 2% share in 2024 and a 3% share in 2025. Construction spending on power facilities also has been swept up in the AI boom. August’s 0.9% MoM rise was the fifth straight, the longest stretch of gains in over a year. The momentum lifted the five-month annualized rate to 16.9% in August, the highest since December 2023. Recent improvement also supported the smoother YoY trend; the 9.7% annual pace was the best since June 2024.

Elsewhere in the private space, everything else was up modestly on the month (single-family and multifamily both up 0.2% MoM and nonresidential ex-data centers up 0.3% MoM). Even with the upticks, it did little to change the YoY trends that remain in negative territory (nonresidential ex-data centers -5.9%, single-family residential -3.5%, multifamily residential -0.6%).

The value of public construction spending continued its quiet gains, extending its winning streak to the six months ended August. On a YoY basis, public construction posted a 2.5% rate, the best performance in eleven months. Highway construction (up 0.1% MoM/4.4% YoY) has been a key support factor.

Construction spending, as it is denominated in nominal dollar terms, can be considered an aggregate budget measure for construction labor trends. Recent construction spending performance could be contributing to the acceleration in job creation in the sector, as reported by payroll provider ADP earlier this week. September’s 15,000 MoM advance for ADP construction payrolls was the best showing since March’s 32,000 MoM increase. It also extended the construction jobs’ winning streak to nine months.

The construction figures can be found in Haver's **USECON** database. The expectations figure is from the Action Economics Forecast Survey in **AS1REPNA**.

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- August headline gain narrowly based.
- Data center heat remains on.
- Public construction’s quiet gains continued.

U.S. Construction Spending: Home Improvement and Data Centers Drove Spending in August

Michael J. Moran

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With inflation and tighter monetary policy now front-line issues, the price index for personal consumption expenditures has arguably become the most important component of this report. Results for August were a bit unsettling. Energy prices jumped 2.3% month-to-month, which left a year-over-year change of 16.8%. Prices excluding food and energy (the core index), rose 0.2%, but the measure almost rounded up to 0.3% (0.247%). The year-over-year change in the core index totaled 3.0%, in line with other readings this year and a full percentage point above the target of the Federal Reserve. Food prices were tame in August: unchanged month-to month and up 1.9% in the past year.

Today’s report included annual benchmark revisions, which affected results back to 2021. The adjustments left the recent year-over-year changes in the PCE price indexes a touch lighter than previously believed. The headline figure for July now shows an increase of 3.4% rather than 3.7%; the core posted a revised advance of 3.0% rather than 3.3%.

The revisions to the price indexes primarily reflected changes in source data. The BEA shifted its source of data on legal services from the CPI to the PPI. Prices for computer software and accessories are now based on information from both the CPI and the PPI rather than the CPI alone. Finally, in calculating the price of portfolio management and investment-advice services, the BEA shifted from the PPI to an implicit-price measure derived from an employment statistic.

The price indexes will probably capture most of the media and market attention, but the income and consumption components are important as well. Nominal personal income rose 0.2% in August, lighter than the averages of 0.4% in the first seven months of this year and in all of 2025. After adjusting for inflation, real personal income fell 0.1%. Compensation of employees and proprietors’ income both rose 0.3% in nominal terms, but these results would translate to little change after adjusting for inflation. Rental income, interest income, and dividends were all light (less than 0.1% in nominal terms).

Despite underwhelming income in August, households spent vigorously, with nominal outlays increasing 0.9% and real spending up 0.6%. Part of this performance could be viewed as catch-up after light spending in July (real outlays up 0.1%), but the data still signal strong economic support from consumers. The figures from this report feed directly into GDP, and results for the first two months of Q3 suggest that the growth of real consumer spending in Q3 could exceed 3.0%, firmer than the average of 2.2% in the first half of this year and 2.1% over the four quarters of 2025.

The personal income and consumption figures are available in Haver’s **USECON** database with detail in the **USNA** database. The Action Economics forecasts are in **AS1REPNA**.

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- Higher energy prices and still-firm increases in core prices.
- Households spend briskly after a pause in July; Q3 activity appears strong.

Personal Income, Consumption, and Prices in August

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The U.S. international trade deficit in goods unexpectedly widened to $132.64 billion in August, the largest since March 2025, from $118.94 billion in July and $101.05 billion in June, the advance estimate from the U.S. Census Bureau showed, pointing to a significant drag on GDP growth in Q3 2026. The August reading marked the third widening in the goods trade deficit in four months, exceeding an $85.16 billion shortfall in August 2025. A deficit of $113.9 billion for August had been expected by the Action Economics Forecast Survey. The deficit reached a low of $61.44 billion in October 2025 (the smallest since February 2020) and a record high of $158.73 billion in March 2025.

Total goods exports rose 1.9% m/m (14.5% y/y) to $203.42 billion in August, the first m/m gain since April, after a 2.9% decline to a six-month low of $199.69 billion in July. A record high of $220.11 billion was reached in April. Exports were up 25.1% from a June 2023 low. The m/m rise in exports in August was led by an 8.3% rebound (30.2% y/y) in industrial supplies & materials, followed by increases of 7.3% (14.8% y/y) in other goods and 2.0% (11.5% y/y) in capital goods excluding autos. To the downside, exports of nonfood consumer goods excluding autos (-10.5%; -4.1% y/y), automotive vehicles & parts (-6.9%; -1.9% y/y), and foods, feeds & beverages (-5.6%; +4.5% y/y) fell m/m in August.

Total goods imports advanced 5.5% m/m (27.9% y/y) to $336.05 billion in August on top of a 3.9% rebound to $318.63 billion in July, marking the sixth monthly rise in seven months and the highest level since March 2025’s record high of $340.11 billion. Imports were up 34.0% from a March 2023 low. The m/m increase in imports in August reflected gains in almost all imports end-use categories, led by an 18.7% recovery (19.7% y/y) in other goods, followed by rises of 16.6% (27.0% y/y) in industrial supplies & materials, 5.5% (9.9% y/y) in foods, feeds & beverages, 4.0% (57.2% y/y) in capital goods excluding autos, and 0.9% (3.2% y/y) in automotive vehicles & parts. In contrast, imports of nonfood consumer goods excluding autos, the only end-use category with a monthly decline in August, fell 1.6% (+2.5% y/y), the second m/m fall in three months, reversing a 0.5% July increase.

The advance international trade data can be found in Haver's **USECON** database. The expectation figure is from the Action Economics Forecast Survey, which is in **AS1REPNA**.

- Deficit: $132.6 bil. in August, up $13.7 bil. (+11.5%) from July’s $118.9 bil., pointing to a significant drag on Q3’26 GDP growth.
- Exports +1.9%, first m/m gain since April, driven by an 8.3% rebound in industrial supplies & materials exports; nonauto consumer goods exports down 10.5%.
- Imports +5.5%, sixth rise in seven mths. to highest level since Mar. ’25, with m/m increases in all end-use categories except nonauto consumer goods imports (-1.6%).

U.S. Goods Trade Deficit Balloons Further in August

Sandy Batten

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In the third estimate, real GDP grew 2.2% q/q saar in Q2, up from 1.5% in both the advance and the second estimates, according to the Bureau of Economic Analysis. The Action Economics Forecast Survey looked for an unrevised 1.5% quarterly gain. Compared with a year ago, GDP was up 2.2% versus 2.1% in both the advance and second estimates. The upward revision to Q2 GDP growth were rather widely spread across expenditure categories, led by personal consumption expenditures, nonresidential fixed investment and a smaller drag from declining inventories. This was the fifth consecutive quarter in which inventories declined, a very unusual occurrence when the economy is not in a recession. This release also contained the second estimate of corporate profits. Profit growth was revised down to 8.9% q/q not annualized from 9.1% in the first estimate. However, this was still the fastest quarterly advance for profits since Q2 2021.

Personal consumption expenditures increased 3.8% q/q saar in the third estimate of Q2, up from 3.4% in the second estimate and 3.2% in the advance report. Faster growth of spending on durable goods and on services were the primary factors behind the upward revision to consumption. Fixed investment growth was also revised faster. Growth of nonresidential fixed investment was revised up to 9.0% from 8.5% in the second estimate, led by upward revisions to both structures and intellectual property. Residential investment growth was also revised up to 2.8% from 1.2% in the second estimate.

Both export and import growth were revised slightly faster but resulted in only a slight widening of the trade deficit and no revision to on overall GDP growth. The previously estimated decline in total government spending growth was revised smaller with a smaller decline in federal spending than previously estimated and a larger increase in state and local government.

Reflecting the upward revision to personal consumption and fixed investment, real domestic demand growth, already strong in the previous two estimates, was revised even stronger. Real final sales to domestic purchasers (GDP less inventory investment and net exports) increased a well above trend 3.8% q/q saar in Q2 versus 3.3% in the second estimate and 3.1% in the advance report. Real final sales to private domestic purchasers (the Fed’s preferred measure of domestic demand) jumped 4.6% q/q in Q2, its largest quarterly gain since Q1 2023, up from 4.2% in the second estimate and 3.9% in the advance report.

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After having been revised higher in the second estimate, GDP inflation measures were revised down in the third estimate. GDP price inflation was revised down to 6.1% q/q saar in the third estimate from 6.4% in the second estimate, still due mostly to the surge in energy prices that occurred in Q2. The core GDP price index rose a revised 4.2%, down from 4.4% in the second estimate. PCE price inflation (the measure the Fed targets) in Q2 was also revised down to 5.0% from 5.3% in the second estimate, again reflecting the surge in energy prices, with core PCE inflation revised down to 3.3% from 3.6% previously but still well above the Fed’s 2% target.

**Today’s report also included annual benchmark revisions for the period Q1 2021 to Q1 2026.** Annual updates provide the opportunity to incorporate improvements that are generally of three types: (1) statistical changes to incorporate newly available and revised source data and to introduce new and improved methodologies, (2) changes in definitions to more accurately portray the evolving U.S. economy and to provide consistent comparisons with data for other national economies, and (3) changes in presentations to reflect the definitional and statistical changes, where necessary, or to provide additional data or perspectives for users. In addition, seasonally adjusted statistics are evaluated and revised during annual updates to reflect recalculated seasonal factors.

In general, these revisions were generally small. After the benchmark revision, annual real GDP grew 3.4% at an annual rate from 2020 to 2025, up slightly from the previously reported 3.3% increase. Real personal consumption expenditures growth slowed marginally to a still well-above trend 3.9% from 4.0% previously. Nonresidential business investment posted the largest upward revision, rising 5.9% from 2020 to 2025 versus 5.4% previously estimated. Residential investment fell a revised 1.3%, down slightly from -1.1% previously. Growth of exports and imports were revised up marginally. And government spending growth was revised up to 1.8% from 1.4%.

The GDP data can be found in Haver’s **USECON** and **USNA** databases. **USNA** contains virtually all of the Bureau of Economic Analysis detail in the national accounts. The Action Economics consensus estimates can be found in **AS1REPNA**.

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- The third estimate of Q2 real GDP raised growth to 2.2% q/q saar from 1.5% in both the advance and second estimate.
- In the annual benchmark revision, Q1 growth was revised up to 2.5% from 2.1%. 
- The sources of the Q3 revision were rather widespread—leading the way, faster consumption and nonresidential investment and a smaller drag from inventories
- The strong Q2 domestic demand growth reported in the advance and second estimates was revised even stronger.
- The Q2 rise in corporate profits were revised down slightly but still posted the strongest quarterly advance since Q2 2021.
- Total benchmark revisions were relatively small with average annual GDP growth from 2020 to 2025 revised up only 0.1%-point to a robust 3.4%.
- The largest annual revision was a 0.5%-point upward revision to nonresidential fixed investment growth.

U.S. GDP Growth Revised Up in both Q1 and Q2; Benchmark Revision Small

Kathleen Stephansen, CBE

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Mortgage applications fell 6.0% w/w (-37.0% y/y) in the week ending September 25, the fourth consecutive weekly decline, after declining 1.5% w/w (-41.5% y/y) in the week ending September 18, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. Applications for loans to purchase a house fell 4.3% w/w (-14.2% y/y) in the latest week, after edging down 0.8% w/w (-11.2% y/y) in the September 18 week. Applications for loan refinancing dropped 8.7% w/w (-56.4% y/y) in the September 25 week following a decline of 2.6% w/w (-62.0% y/y) in the September 18 week.

The effective interest rate on a 30-year fixed-rate loan jumped 19bps to 7.52% in the week ending September 25 from 7.33% in the week ending September 18, reaching its highest level since November 2023. The rate on 15-year fixed-rate mortgages rose 9bps to 6.81% in the September 25 week from 6.72% in the September 18 week. The 30-year Jumbo rate increased 12bps to 7.42% in the latest week from 7.30% in the September 18 week. The rate on a 5-year ARM jumped 54bps to 6.92% in the September 25 week from 6.38% in the September 18 week.

The share of applications for refinancing an existing loan fell to 38.3% of total applications in the week of September 25 from 39.3% in the week ending September 18. The adjustable-rate mortgage (ARM) share of activity rose to 10.3% in the latest week from 9.8% in the September 18 week.

The average size of a mortgage rose 0.9% w/w (-5.8% y/y) to $384,200 in the week ending September 25, after rising 0.6% w/w (-11.4% y/y) to $380,700 in the week ending September 18. The average size of a purchase loan also increased 0.9% w/w to $450,900 in the September 25 week after rising 1.0% w/w to $446,900 in the September 18 week. The average size of a loan to refinance a mortgage fell 0.6% w/w to $276,700 in the week ending September 25 after declining 0.5% w/w to $278,400 in the September 18 week.

The Mortgage Bankers Association Survey covers 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver’s **SURVEYS** database.

- Applications for loans to purchase and applications for loan refinancing both declined in the latest week.
- Interest rate on 30-year fixed-rate loans jumped 19bps to 7.52%.
- Average loan size rose moderately in the September 25 week.

U.S. Mortgage Applications Fell in the September 25 Week

Robert Brusca

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Inflation has flared across the largest economies of the monetary union. The headline boost is clear. The core or ex-energy gains also are clear but are more moderate; more moderate but nonetheless excessive in September. Largely over the last three months, inflation has been percolating.

The chart shows a clear, abrupt acceleration of inflation in the three largest monetary union economies: Germany, France, and Italy. Twelve-month inflation rates for the top four economies range from 3.3% in Germany to 5.0% in Spain. Over six months, the range is 3.5% (Germany) to 6.2% (Spain). Over three months, the stakes rise sharply, with annualized inflation spurts at a high of 9.1% (Spain) vs. ‘only’ 5.5% (Italy).

Inflation accelerates from a year ago to 12 months, from 12 months to six months, and from six months to three months on all headline comparisons except for Italy from six months to three months. But even on that comparison, the downshift in the pace is minor, and three-month inflation in Italy is still stronger than 12-month inflation. The inflation pressure is rising even if the gains are not monotonic.

Core inflation is high and mostly rising as well. However, core inflation is less prone to have risen over 12 months compared to 12 months ago. On that basis, only Spain’s core inflation has risen. German ex-energy inflation steps down, and Italian core inflation drops off to a below-target 1.5% over 12 months. To restart these comparisons for the three-country inflation ranges on the core or ex-energy measures over one year, we see a range from 1.5% to 3.1%. Over six months, inflation accelerates for all three, but the low end sees Italian inflation only up to a 1.6% pace, whereas the high end at 3% is Spain. However, Spain’s strong gain marks a deceleration from its 12-month pace. Over three months, inflation kicks up its heels across the core and ex-energy measures, from a low of 2.4% in Italy to a high of 3.6% in Spain. And core inflation accelerates in all three countries over three months.

Core inflation has been slower to rise, but once it rises it tends to be more stubborn. The global push toward higher inflation is still in gear as oil prices are lingering high. Stock markets have been trying to weather the storm of high inflation and an uncertain future. All eyes are turning to the winter season even though it is only fall. Winter is cropping up to be a difficult one for Europe, with low energy stockpiles as the season approaches. There is a lot to worry about and very little we can be sure of. As aspects of the future draw nearer, we’re gaining focus on what matters, and what matters and what is under control are, increasingly, two different things.

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Europe

Inflation Sallies Forth

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Mortgage applications fell 4.2% w/w (-36.6% y/y) in the week ending October 2, the fifth consecutive weekly decline, after declining 6.0% w/w (-37.0% y/y) in the week ending September 25, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. Applications for loans to purchase a house fell 2.1% w/w (-14.9% y/y) in the latest week, after declining 4.3% w/w (-14.2% y/y) in the September 25 week. Applications for loan refinancing dropped 7.5% w/w (-56.3% y/y) in the October 2 week, the seventh consecutive weekly decline, following a decline of 8.7% w/w (-56.4% y/y) in the September 25 week.

The effective interest rate on a 30-year fixed-rate loan jumped 21bps to 7.73% in the week ending October 2 from 7.52% in the week ending September 25, reaching its highest level since November 2023. The rate on 15-year fixed-rate mortgages rose 16bps to 6.97% in the October 2 week from 6.81% in the September 25 week. The 30-year Jumbo rate increased 12bps to 7.54% in the latest week from 7.42% in the September 25 week. The rate on a 5-year ARM rose 13bps to 7.05% in the October 2 week from 6.92% in the September 25 week.

The share of applications for refinancing an existing loan fell to 37.0% of total applications in the week of October 2 from 38.3% in the week ending September 25. The adjustable-rate mortgage (ARM) share of activity was unchanged at 10.3% in the latest week.

The average size of a mortgage fell 1.7% w/w (-5.1% y/y) to $377,700 in the week ending October 2, after rising 0.9% w/w (-5.8% y/y) to $384,200 in the week ending September 25. The average size of a purchase loan declined 0.6% w/w to $448,400 in the October 2 week after rising 0.9% w/w to $450,900 in the September 25 week. The average size of a loan to refinance a mortgage fell 7.0% w/w to $257,200 in the week ending October 2 after declining 0.6% w/w to $276,700 in the September 25 week.

The Mortgage Bankers Association Survey covers 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver’s **SURVEYS** database.


- Applications for loans to purchase and applications for loan refinancing both declined in the latest week.
- Interest rate on 30-year fixed-rate loans jumped 21bps to 7.73%.
- Average loan size fell moderately in the October 2 week.


U.S. Mortgage Applications Fell in the October 2 Week

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