Succinct summation of week’s events:
Positives:
1) The euro experiment lives to fight another day as more time is bought but will the time be well spent in generating growth and cutting debt, the core of the problem.
2) According to the new Greek Fin Min, Greek banks get deposit inflows after elections two weeks ago.
3) Chicago PMI unexpectedly ticks up slightly but only to 2nd weakest since Sept ’09.
4) Dallas mfr’g rises to +5.8 from -5.1.
5) AAA says gasoline prices fall another .07 on the week to $3.35 on avg, the lowest since early Jan.
6) May Pending Home Sales rise 5.9% m/o/m vs the est of a gain of 1.5%. Index now matches the best since Apr ’10.
7) May New Home Sales rise to most since Apr ’10, months supply falls to 4.7 from 5.0.
8) C/S home price index up more than expected m/o/m in Apr.
9) PCE headline price deflator up 1.5% y/o/y in May, the slowest rate of gain since Jan ’11, good for the avg person, especially for those with stagnant wages.
Negatives:
1) Europeans still can’t figure out how to grow and that debt reduction, not its increase is the path to a solution.
2) Durable Goods Orders ex volatile transportation sector rises less than expected.
3) Initial Jobless Claims at 386k is the 5th week in a row above 380k for 1st time since Nov/Dec, pointing to a still lackluster labor market.
4) Final June UoM confidence falls from preliminary reading to lowest of the year.
5) Richmond mfr’g drops from +4 to -3 and below est of +2.
6) PCE headline price deflator up 1.5% y/o/y in May, the slowest rate of gain since Jan ’11, unfortunately will give the Fed the belief they have further license to print even more money, thus lifting inflation again.
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