U.S. single-family building permits rebound May. Privately-owned housing units authorized by building permits in May were at a seasonally adjusted annual rate of 1,220,000, +14.4% above the revised April rate of 1,066,000, but -8.8% below the May 2019 rate of 1,338,000. Single-family authorizations in May were at a rate of 745,000, +11.9% above the revised April figure of 666,000. Authorizations of units in buildings with five units or more were at a rate of 434,000 in May.
PMI inches up in May after April’s huge drop. The May Purchasing Managers Index (PMI) registered 43.1% percent, up 1.6 percentage points from the April reading of 41.5%. This figure indicates some improvement in the overall economy after April’s 7.6-point drop. Published monthly by the Institute for Supply Management, Tempe, AZ, the PMI is based on a survey of industrial purchasing managers on business conditions. Any reading below 50% reflects a negative industrial purchasing environment.
Leading Economic Index continues its decline in April. The Conference Board’s Leading Economic Index (LEI) for the U.S. declined -4.4% in April to 98.8 (2016 = 100), following a -7.4% decline in March, and a -0.2% decline in February.
“In April, the U.S. LEI continued on a downward trajectory, after posting the largest decline in its 60-year history in March,” said Ataman Ozyildirim, senior director of economic research for The Conference Board, in the press release. “The erosion has been widespread, except for stock prices and the interest rate spread which partially reflect the rapid and large response of the Federal Reserve to offset the pandemic’s impact and support financial conditions. The sharp declines in the LEI and CEI suggest the U.S. economy is now in recession.”
“Business conditions may recover for some sectors and industries over the next few months,” added Bart van Ark, chief economist for The Conference Board. “But, the breadth and depth of the decline in the LEI suggests that an imminent re-opening of some sectors does not imply a fast rebound for the economy at large.”
