9/20: MetroIntelligence Economic Update by P. DUFFY

August existing home sales rose to 17-month as inventory slipped to 4.1 months

August existing-home sales rose 1.3 percent from July and 2.6 percent year-on-year to a seasonally adjusted annual rate of 5.49 million to the highest level in 17 months.  The median existing-home price rose to $278,200, up 4.7 percent from August 2018.  Unsold inventory is at a 4.1-month supply at the current sales pace, down from 4.2 months in July and from the 4.3-month figure recorded a year ago.



August Leading Economic Index unchanged as economy chugs along

The US LEI remained unchanged in August at 112.1, following a large increase in July. Housing permits and the Leading Credit Index offset the weakness in the index from the manufacturing sector and the interest rate spread.  The recent trends in the LEI are consistent with a slow but still expanding economy, which has been primarily driven by strong consumer spending and robust job growth.



Federal Reserve lowers key interest rate another 25 basis points, but outlook still uncertain

In light of the implications of global developments for the economic outlook as well as muted inflation pressures, the Federal Open Market Committee decided to lower the target range for the federal funds rate to 1.75 to 2.0 percent. This action supports the Committee’s view that sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee’s symmetric 2.0-percent objective are the most likely outcomes, but uncertainties about this outlook remain.