Tom Moeller

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Consumers lost their mood for spending at the end of last month. According to the International Council of Shopping Centers-Goldman Sachs Index, store sales last week gave back with a 0.6% decline virtually all of the prior week&#39;s increase. That left sales for the entire month of May down 0.2% from April after that month&#39;s 1.4% rise from the March average.
During the last ten years there has been a 64% correlation between the year-to-year growth in chain store sales and the growth in general merchandise sales. These weekly figures are available in Haver&#39;s SURVEYW database.
The ICSC-Goldman Sachs retail chain-store sales index is constructed using the same-store sales (stores open for one year) reported by 78 stores of seven retailers: Dayton Hudson, Federated, Kmart, May, J.C. Penney, Sears and Wal-Mart.
Prospects for spending also were tepid last week as indicated by the leading indicator of sales. It fell a modest 0.3% in the latest week. The May average stands just below April.

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<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/surveyw/@S2/@S2.HTM">ICSC-UBS (SA, 1977=100)</a></th>
<th scope="col">05/30/09</th>
<th scope="col">05/23/09</th>
<th scope="col">Y/Y</th>
<th scope="col">2008</th>
<th scope="col">2007</th>
<th scope="col">2006</th>
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<td class="firstcol">Total Weekly Chain Store Sales</td>
<td>487.4</td>
<td>490.5</td>
<td>0.6%</td>
<td>1.4%</td>
<td>2.8%</td>
<td>3.3%</td>
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Consumers lost their mood for spending at the end of last month. According to the International Council of Shopping Centers-Goldman Sachs Index, store sales last week gave back with a 0.6% decline virtually all of the prior week's [...]

U.S. Chain Store Sales Backpedal

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New single-family home sales increased 7.4% (6.0% y/y) to 724,000 (SAAR) during March after increasing 3.1% in February to 674,000, revised from 676,000, according to the U.S. Census Bureau. The Action Economics Forecast Survey expected sales of 686,000. The sales rise in March occurred as the average 30-year fixed-rate mortgage fell to an average 6.65% last month from 6.84% in February, according to Freddie Mac. It compares to a low of 6.18% averaged in September.

By region, home sales varied across the country last month. New home sales in the Northeast declined 22.2% (-33.3% y/y) to 28,000 in March, after rising 33.3% in February. Sales in the Midwest rose 3.0% (-15.9% y/y) to 69,000, after rising 8.1% in February. In the South, new home sales increased 13.6% (22.3% y/y) to 483,000, following a 7.6% February rise. New home sales in the West declined 1.4% (-12.2% y/y) to 144,000, after falling 14.1% in February.

The median sales price of a new home fell 1.9% (-7.5% y/y) to $403,600 in March after falling 4.6% to $411,500 in February. The average sales price of a new home improved 1.0% (-4.7% y/y) to $497,700 in March, following a 3.6% February decline. The average price was 8.0% below a high of $541,200 in July 2022. These sales price data are not seasonally adjusted.

The number of unsold new homes on the market rose 0.6% (7.9% y/y) to 503,000 in March, after a 0.8% February increase. The seasonally adjusted months' supply of new homes for sale fell to 8.3 months in March after falling to 8.9 months in February. The latest reading remained above a low of 6.9 months in May 2023.	

The median number of months a new home stayed on the market increased to 3.1 months in March, up from a June 2024 low of 2.1 months. It was the highest level since April 2022. The latest number stood well above its record low of 1.5 months in both September and October of 2022, but remained below a high of 5.1 months in March 2021. These figures date back to January 1975.

New home sales are recorded when the sales contract is signed. New home sales activity and prices are available in Haver's **USECON** database. The consensus expectation figure from Action Economics is available in the **AS1REPNA** database.

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- Sales rise to highest level in six months.
- Changes in sales are mixed across the country.
- Median sales price falls to four-month low.

U.S. New Home Sales Improve in March; Prices Weaken

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Mortgage applications declined 12.7% (+18.7% y/y) in the week ended April 18 after dropping 8.5% in the week ended April 11, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. Applications to refinance an existing mortgage plunged 20.0% (+42.5% y/y) in the week ended April 18, after falling 12.4% one week earlier. Loan applications to purchase a home declined 6.6% (+6.4% y/y) in the latest week, after falling 4.9% in the prior week.

The effective interest rate on a 30-year fixed rate loan rose to 7.09% in the week ended April 18 from 6.99% in the week ended April 11 and 6.79% one week prior. The effective rate on a 15-year fixed rate loan rose to 6.34% in the week of April 18 from 6.27% one week earlier. The rate on a 30-year jumbo loan jumped to 7.03% last week from 6.93% in the prior week, while the rate on a 5-year ARM eased to 6.19% in the week ended April 18 after rising to 6.31% in the week ended April 11.

The share of applications to refinance an existing mortgage declined to a 10-month low of 37.3% in the week ended April 18 from 41.3% in the prior week. The share of loans with an adjustable rate fell to 7.5% in the latest week, following a rise to 9.6% in the prior week.

The average size of a mortgage loan dropped to $386,800 (+1.3% y/y) in the week ended April 18, after falling to $415,100 in the prior week. The average size of a loan to purchase a home declined to $439,900 (+0.5% y/y) from $445,300 in the week prior. The average size of a loan to refinance an outstanding mortgage dropped to $297,700 (+16.4% y/y) in the week ended April 18 from $372,300 in the week ended April 11.

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.

- Refinancing loans fall sharply and purchase loan applications decline as well.
- Effective interest rate increases to two-month high.
- Average loan size falls sharply.

Mortgage Applications Continue to Fall as Interest Rates Rise in Latest Week

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Retail gasoline prices for all grades declined to an average $3.27 per gallon (-13.8% y/y) in the week ended April 21 after falling to $3.30 in the prior week. Prices were $3.37 per gallon to begin the month but remained above their low of $3.13 in the week of December 9. An earlier high was $3.79 in the week ending April 22, 2024. Its all-time high of $5.11 occurred in the week ending June 13, 2022. The retail price for on-highway diesel fuel fell to $3.53 per gallon (-11.5% y/y) in the week of April 21 from $3.58 in the prior week. The latest diesel price stood well below a high of $4.63 in the week ending September 18, 2023 and a peak of $5.81 in the week ending June 20, 2022.

The price of West Texas Intermediate crude oil rose to $62.50 per barrel (-25.9% y/y) in the week ended April 18, after declining to $60.84 per barrel in the prior week. Prices remained below a high of $91.45 in the week of September 29, 2023. The cost of crude oil peaked at $120.46 in the week of June 10, 2022. Yesterday, the price was $63.08 per barrel. The price of European Brent crude oil rose to $67.76 per barrel (-24.4% y/y) in the week of April 18 from $66.10 in the previous week. Prices remained well below a recent high of $95.61 in the week of September 29, 2023 and compared to a peak of $127.40 in the week of June 10, 2022.

Natural gas prices declined last week to an average $3.26 per mmbtu (+123.3% y/y) in the week ended April 18, after falling to $3.68/mmbtu in the prior week. Prices remained well above a low of $1.40/mmbtu in the week of March 15, 2024 but below their peak of $9.56 in the week of August 26, 2022. Yesterday’s price was $3.16/mmbtu.

Gasoline demand fell 3.4% y/y in the four weeks ending April 11 following a 2.8% y/y decline in the prior four weeks. Demand for all petroleum products weakened 1.7% y/y in the four weeks ending April 11 after a 1.9% y/y decline in the previous four-week period. Crude oil input to refineries fell 1.6% y/y in the four weeks ending April 11 after a 1.3% y/y decline in the prior four weeks.

Gasoline inventories rose 2.9% y/y in the week ending April 11 after a 3.3% y/y rise in the week ending April 4. Residual fuel oil inventories fell 14.0% y/y in the week of April 11, after a 15.0% y/y fall in the prior week. Crude oil inventories rose 1.8% y/y in the week of April 11 after a 2.1% y/y rise in the previous week.

Measured in days’ supply, gasoline inventories held steady w/w at 27.5 days in the week of April 11. The recent low was 22.9 days in the week of November 8. The supply of crude oil also was unchanged w/w at 28.3 days in the week of April 11, up from 24.6 days in the week of January 10 but remained below a high of 31.9 days in the week of March 3, 2023.

These data are reported by the Energy Information Administration of the U.S. Department of Energy. The price and supply/demand data can be found in Haver’s **WEEKLY** & **USENERGY** database.

- Gasoline prices fall sharply again.
- Crude oil prices edge higher.
- Natural gas costs decline further.

U.S. Energy Prices Are Mixed in Latest Week

Robert Brusca

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Danish confidence slipped to -17 in April from -15.5 in March, continuing a slide that extends back to late-2023. The weakness accelerated in late-2024 especially with the conclusion of the U.S. elections.

On data back to late 1995, the consumer confidence indicator for Denmark ranks in its lower 3.7 percentile. Confidence has been higher than this most of the time over this period.

The financial situation over the past 12 months ranked at a weak 7.3 percentile standing, but for the next 12 months an even weaker 1.4 percentile reading is in place. The existence of U.S. tariffs and pushback for Europe to carry more of its own defense burden seem to be adversely impacting Danish sentiment. There may also be some anxiety stemming from President Trump’s stated desire to have Greenland, a semi-autonomous Danish territory, become part of the United States.

The general economy has a confidence ranking at its 13.8 percentile over the last 12 months, but that drops to an all-time low ranking of zero for the next 12 months. All these respondents backed down in April compared to their March readings. The ‘expected’ financial conditions response fell by the most.

In sharp contrast, consumer prices for the last 12 months carried a 92.7 percentile standing; for the next 12 months, that pushes back up to the 98.6 percentile. Meanwhile, unemployment concerns, while ticking lower, have a standing at their 84.6 percentile higher since 1995 less than 16% of the time.

The environmental readings show the favorability of the time to purchase or save for the next or last 12 months (four metrics) all generate readings below their respective median (below a standing of 50%. The time to purchase readings are the weakest in this group.

However, the general financial situation for households currently holds above its historic standing at a reading with a 54.5 percentile standing. But that reading eroded last month.

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On balance, Denmark is going through difficult times with consumer confidence shaken across the board on all responses. All the standings of the various responses are generally poor. Still, the current generalized financial situation for households is judged as a positive despite further erosion on the month. Danish respondents may have a great deal of individual concerns, but when it comes to the ‘here and now’ they seem to acknowledge that conditions are much better than they expect them to become over the next 12 months judging from their survey responses.

U.S. Chain Store Sales Backpedal

Summary

Tom Moeller

More Economy in Brief

U.S. New Home Sales Improve in March; Prices Weaken

Mortgage Applications Continue to Fall as Interest Rates Rise in Latest Week

U.S. Energy Prices Are Mixed in Latest Week

Danish Confidence Drops to 2-Year Low; Inflation Concerns Remain Elevated