Home Price Gains, Consumer Confidence Slips, PCE Rose
May 31, 2016
Tuesday – May 31
Home price gains remained steady in March due in part to a limited supply of homes on the market. The S&P Case-Shiller 20-city Home Price Index rose 5.4% this March from March 2015. From February to March, prices rose 0.9%. The S&P Case Shiller National Home Price Index was up a solid 5.2% from the previous March. A spokesperson from the index said, “The economy is supporting the price increases with improving labor markets, falling unemployment rates and extremely low mortgage rates.
Consumer Confidence slipped in May after declining in April as Americans felt that current conditions were less favorable in May than in April. The Consumer Confidence Index fell to 92.6 in May, down from the 94.7 in April and below the 96.2 expected. The index measures consumer attitudes, sentiment towards business conditions, short-term outlook, personal finances and jobs. The employment component said 24.4% of respondents said jobs were hard to get, up from 22.8% in April.
The Fed’s favorite inflation gauge, the Core Personal Consumption Expenditure (PCE), rose 0.2% in April, in line with expectations, while year-over-year rose 1.6%, in line and matching the March number. Consumers opened their wallets in April as Personal Spending rose 1% versus 0.7% expected, the fastest pace in nearly seven years. Consumer spending accounts for more than two-thirds of economic output in the U.S.