Economic Updates

According to the Federal Reserve, consumer credit debt rose in April by $954.8 million. Economists had forecast that consumer debt would fall by $1 billion in April. Consumer credit debt fell in March by $5.44 billion.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications for the week ending June 4 declined 12.2%. Refinancing applications fell 14.3%. Purchase volume decreased 5.7%.

Wholesalers increased their inventories by 0.4% in April, following an upwardly revised 0.7% rise in March. Sales at the wholesale level rose 0.7% in April, marking the 13th straight monthly gain.

The trade deficit increased 0.6% to $40.3 billion in April. It was the highest level since December 2008 and follows a $40 billion gap in March.

Retail sales fell 1.2% in May, after gaining 0.6% in April. Economists had anticipated retail sales to rise 0.4% in May. The decline — the largest since a 2.2% drop in September — was led by a 9.3% drop in building materials.

The Reuters/University of Michigan consumer sentiment index for June's preliminary reading rose to 75.5, the highest since January 2008. The index hit a 30-year low of 55.3 in November 2008.

Total business inventories rose 0.4% in April, following an upwardly revised 0.7% increase in March. Total business sales rose 0.6% in April.

Initial claims for unemployment benefits fell by 3,000 to 456,000 for the week ending June 5. Continuing claims for the week ending May 29 fell by 255,000 to 4.46 million, the lowest level since December 2008.

Upcoming on the economic calendar are reports on the housing market index on June 15, housing starts on June 16 and the index of leading economic indicators on June 17.

Provided by:

Judy Haller

Prospect Mortgage

3985 Prince William Co. Pkwy., Suite 104
Woodbridge, VA 22192

Office: (703) 590-7132