First quarter GDP grew by just 0.1% in the first quarter from the first quarter of 2013 in data released this morning. In the fourth quarter the economy grew at an annual rate of 2.6%. Economists surveyed had expected growth to slow to 1% or 1.2%
If the housing sector is still supposed to be the lead engine for the U.S. economy, that engine seems to be slowing down. The numbers this morning show that sales of previously owned homes fell in March for a third consecutive month. Housing prices climbed 6.9% in February from February 2013. That would be good news—except that the increase is the smallest gain in a year.
The International Monetary Fund carefully hedged yesterday’s good news on the global economy. Because the world’s developed economies—rather than historically faster growing developing economies—will provide the engine for global growth in 2014 and 2015, the world as a whole will grow slightly more slowly than the IMF had projected in early January
The U.S. economy added 192,000 jobs in March. That was slightly below the 195,000 expected by economists. The Bureau of Labor Statistics updated its survey for February to show the economy added 197,000 jobs that month and not 175,000. The official unemployment rate remained at 6.7%. Economists had expected the rate to tick down to 6.6%.
Nothing wrong with a period of consolidation after the market’s strong move off the February 3 low at 1741.89, but consolidations do resolve themselves eventually into a move higher or a lower. Right now the U.S. market seems to be waiting for more definitive news about the strength of U.S. economy.
Today has turned into a class risk off day in global financial markets—largely on news that China’s exports plunged 18.1% in February. Economists surveyed by Bloomberg had expected a 7.5% increase in exports.
There was enough good news in the February jobs numbers to keep alive hopes that the recent sluggishness in the U.S. economy is “only cold weather.” But with the S&P 500 at new all-time highs this week, is that story enough?
