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Retail sales in the USA rose 1.4% in October, much better than a gain of 1.0% economists expected, the Commerce Department reported on Monday. Last month, auto sales jumped 7.4%, while excluding autos, the retail sales in October would rise just 0.2 percent, the weakest showing since a 0.5 percent drop in July. Of note the filing station sales were flat, but excluding gasoline and auto sales, other retailers sales increased 0.3% last month, the 3rd consecutive gain. Consumer spending, which accounts for about 70% of US economic activity, is a broad measure of economic activity. Read more

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Orders for US durable goods rebounded in September, a positive sign for the manufacturing sector, according to government data released Wednesday. The Commerce Department said new orders for manufactured durable goods expected to last at least three years rose 1.0% in September, matching economists’ expectations. September’s rise in orders followed a 2.6% decline in August and a 4.8% surge in July. A 7.9% rise in orders for machinery, the best showing since an 8.5% surge in March 2008, led the overall increase. Excluding the transportation sector, where orders can vary widely from month to month, new orders rose 0.9% in September after a 0.4% fall in August. Although the manufacturing sector has shown signs of recovery, many economists are worried that demand could falter in the months ahead as various government stimulus programs expire.

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US new home sales dropped in September as the government’s tax credit for 1st time home buyers is about to expire, according to official data released on Wednesday. The Commerce Department said sales decreased 3.6% to a seasonally adjusted annual rate of 402,000 from the downwardly revised 417,000 in August, and slumped 7.8% from a year ago. The September data were much lower than most economists’ forecast of 440,000 units. It was also the 1st decline since March. The median sales price in September was down 9.1% to US$204,800 from US$225,200 in Y 2008. Analysts said the housing market remained fragile, with the country’s unemployment rate staying high and consumers reluctant to spend. With the US$8,000 tax credit program for 1st time home buyers set to expire on Nov. 30, home builders and economists are worried that house selling will plunge after the deadline, further hurting the fragile real-estate market. The US Congress is considering extending the tax credit through March 2010 and gradually phasing it out over the rest of next year. It is widely expected that the tax credit will be extended by the Congress.

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The USD continued falling against major currencies on Thursday amid better-than-expected employment data and rising US stocks. US Initial Jobless claims fell to 550,000 last week from 576,000 in the previous week, the Labor Department reported on Thursday. Analysts have expected the claims would fall to 560,000. Total continuing claims fell to 6.088 million, their lowest level since April. US trade deficit jumped 16.3 percent in July, according to the Commerce Department. Imports surged 4.7 percent, mainly due to sharp increases in crude oil and automotive products. Exports rose by 2.2 percent, the third consecutive month of solid gains in exports, corroborating other evidence that the global economy is picking up steam. The increase in the trade deficit should be viewed as a positive development, said analysts of Global Insight. Read more

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Crude Oil prices sank about 6% on Wednesday after data showed crude inventories surged the most since April, reminding the fundamentals were still weak. Light, sweet crude for September delivery closed off US$3.88, or 5.8% to settle at US$63.35 bbl on the New York Mercantile Exchange. According to the US Energy Department’s Energy Information Administration (EIA), crude stockpiles rose by 5.1 million barrels for the week ended July 24, the biggest surge since April, driving the total stockpiles to 347.8 million barrels, 9.5 percent higher than the five-year average for the period. Crude Oil prices headed even lower after the Commerce Department reported that new durable goods orders fell 2.5% in June, the largest percentage drop since January, after rising 1.3% in May. London Brent for September delivery dropped US$3.60 to US$66.28 bbl on the ICE Futures exchange.

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US consumer spending in May rose for the first time since February, and savings hit a record high as federal stimulus measures boosted incomes, bolstering the view that the economy was close to emerging from recession. US consumer sentiment also edged higher this month to its strongest since February 2008. Consumer spending, which accounts for more than 70% of US economic activity, rose 0.3% in May, the Commerce Department said last Friday. The department also revised up April’s figure to un-changed from a small decline previously. Personal income jumped 1.4% last month, propped up by social benefit payments from the government’s massive economic stimulus. The US$ extended losses vs. the Euro as the data reduced safe haven demand for the “Greenback”.

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