ECONOMIC UPDATES

Wholesalers decreased their inventories 0.2% in November, following a revised 1.7% rise in October. Sales at the wholesale level rose 1.9% in November after a revised 2.6% increase in October.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending January 7 rose 2.2%. Refinancing applications increased 4.9%. Purchase volume fell 3.7%.

The trade deficit decreased 0.3% to $38.3 billion in November from $38.4 billion in October. Economists had expected a trade deficit of $41 billion. Exports rose 0.8% to $159.6 billion. Imports increased 0.6% to $197.9 billion.

The producer price index, which tracks wholesale price inflation, rose 1.1% in December after a 0.8% increase in November. Core prices — excluding food and fuel — rose 0.2% in December. For the year, seasonally adjusted wholesale prices are up 4.1%.

Retail sales rose 0.6% in December after a 0.8% increase in November. It was the sixth straight monthly gain. For the year, retail sales rose 6.6% in 2010, the largest annual increase since 1999.

Industrial production at the nation's factories, mines and utilities rose 0.8% in December, following a revised 0.3% increase in November. Compared to a year ago, industrial production is up 5.9%. Capacity utilization rose to 76% in December.

Upcoming on the economic calendar are reports on the housing price index on January 18, housing starts on January 19 and existing home sales on January 20.

Provided by:

Judy Haller

Prospect Mortgage

3985 Prince William Co. Pkwy., Suite 104

Woodbridge, VA 22192

Office: (703) 590-7132