MetroIntelligence Economic Update by P. DUFFY
Initial unemployment claims dip another 6.3 percent to just over 700,000
In the week ending November 7, initial unemployment claims were 709,000, a decrease of 48,000, or 6.3 percent, from the previous week’s revised level. Continued claims during the week ending October 31 was 6,786,000, a decrease of 436,000, or 6.0 percent, from the previous week’s revised level. The total number of people claiming benefits in all programs for the week ending October 24 was 21,157,111, a decrease of 374,179, or 1.7 percent, from the previous week.
Inflation muted: CPI unchanged in October but up 1.2 percent year-on-year
The Consumer Price Index for All Urban Consumers (CPI-U) was unchanged in October but rose 1.2 percent year-on-year. The indexes for airline fares, recreation, and new vehicles were among those to rise, while the indexes for motor vehicle insurance, apparel, and household furnishings and operations declined. The ‘core’ index less food and energy was also unchanged in October and rose 1.6 percent year-on-year.
Economic Sentiment Index slips to lowest level since mid-August as new virus cases rise
The latest reading of the HPS-CivicScience Economic Sentiment Index (ESI) showed a drop of 2.2 points to 47.8, most of which occurred after election day according to the three-day moving average. This ties with a drop in July as the ESI’s most significant single-reading drop since March’s 9.3-point plunge at the outset of the pandemic. The decline in confidence over the past two weeks comes as the public turns away from election news coverage and grapples with the rise in new virus cases.
Single-family rental sector benefiting strongly from pandemic
The single-family rental (SFR) sector is having its moment. Before the pandemic, the millennial cohort’s maturation and the apparent extinction of the “starter home” were already supporting heightened SFR demand. When the full weight of COVID-19 hit in March, a robust debate about the ramifications for SFRs quickly followed.Rent collections are reportedly holding in line with 2019 levels, occupancy rates have reached generational highs, and rent growth pressures for vacant-to-occupied units have firmed.