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Weekly Economic Update, August 29th

on Sep 1, 2016 in Announcements: Financial Planning, General Parrott Insurance News

YELLEN HINTS AT A RATE HIKE
Speaking Friday at the Federal Reserve’s annual retreat in Jackson Hole, Wyoming, Fed chair Janet Yellen commented that “the case for an increase in the federal funds rate has strengthened in recent months.” That statement was interpreted by some economists as a sign that the central bank could adjust interest rates this fall, but perhaps only after the presidential election.1

NEW HOME SALES ACCELERATE, RESALES DECLINE
The good news, from the Census Bureau: July brought a 12.4% leap in new home buying. Sales approached a 9-year peak, even with only 4.3 months of new home inventory available. The bad news, from the National Association of Realtors: July saw existing home purchases slip 3.2%. Inventory was down 5.8% year-over-year; the median sale price was $244,100, 5.3% better than a year earlier.2

SENTIMENT GAUGE SLIPS IN AUGUST
The University of Michigan’s consumer sentiment index finished the eighth month of the year at 89.8, underneath its 90.4 preliminary reading. Consumer assessment of current economic conditions remained high at 107.0, increasing nearly a point from the initial August survey.3

STOCKS GIVE BACK SOME GROUND
Wall Street wavered after Janet Yellen’s speech Friday, and all three major indices ended up down for the week as investors contemplated her remarks and the federal government’s new 1.1% estimate of Q2 growth. Comparing the settlements at Friday’s closing bell to those a week earlier, the Dow Jones Industrial Average settled 0.85% lower at 18,395.40; the Nasdaq Composite, 0.37% lower at 5,218.92; and the S&P 500, 0.68% lower at 2,169.04.3,4

Citations.
1 – usatoday.com/story/money/2016/08/26/yellen-case-rate-hike-has-strengthened/89363312/ [8/26/16]
2 – nytimes.com/aponline/2016/08/24/us/politics/ap-us-home-sales.html [8/24/16]
3 – investing.com/economic-calendar/ [8/26/16]
4 – markets.wsj.com/us [8/26/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F26%2F15&x=0&y=0 [8/26/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F26%2F15&x=0&y=0 [8/26/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F26%2F15&x=0&y=0 [8/26/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F26%2F11&x=0&y=0 [8/26/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F26%2F11&x=0&y=0 [8/26/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F26%2F11&x=0&y=0 [8/26/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F25%2F06&x=0&y=0 [8/26/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F25%2F06&x=0&y=0 [8/26/16]
5 – bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F25%2F06&x=0&y=0 [8/26/16]
6 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [8/26/16]
7 – treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [8/26/16]

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