9/8/2022 – EconUpdate by P. Duffy
Survey shows broad-based contraction in economic output in August
US private sector firms signaled a broad-based decline in output during August, as all seven monitored sectors registered contractions in business activity. It was only the second time on record (since October 2009) that all sectors have seen a decrease in output, the first time having been in May 2020 during the initial wave of COVID-19.
Service sector index edges up to 56.9 percent in August
In August, the Services PMI® registered 56.9 percent, 0.2 percentage point higher than July’s reading of 56.7 percent. The services sector had a slight uptick in growth for the month of August due to increases in business activity, new orders and employment. Based on comments from Business Survey Committee respondents, there are some supply chain, logistics and cost improvements; however, material shortages remain a challenge. Employment improved slightly despite a restricted labor market.
Purchase loan applications fall one percent from previous week, down 23 percent year-on-year
The Market Composite Index for mortgage applications decreased 0.8 percent on a seasonally adjusted basis from one week earlier, with purchase loans falling 1 percent (and down 23 percent year-on-year) and refinance activity also falling 1 percent (and down 83 percent year-on-year). The adjustable-rate mortgage (ARM) share of activity remained unchanged at 8.5 percent of total applications. The average contract interest rate for 30-year fixed-rate mortgages increased to 5.94 percent from 5.80 percent.