Today's Economic Docket: Dallas Fed And New Home Sales Should Confirm Contractionary Relapse
New home sales expected to rebound from record lows. Dallas Fed at 10:30 should confirm the Q2 economic contraction (expect Goldman to downgrade Q2 GDP if Dallas Fed comes under 10). After a one day absence, POMO is back, though today all Primary Dealer proceeds will likely go to fund margin calls.
10:00: New home sales (March): Likely higher, but level still low. New home sales fell by 17% to an all-time low in February. While activity in the new home market looks poor in general, a few special factors may have depressed sales volumes during that month. Specifically, weak sales in the Northeast and Midwest may have resulted from inclement winter weather, and the drop in the West could have been payback for an earlier tax credit-induced jump (in California). We therefore expect that sales partially recovered in March. However, our forecast of a 10.0% increase would still leave the level of sales very low at an annualized rate of 275,000.
Median forecast (of 64): +12.0%; Last -16.9%.
10:30: Dallas Fed manufacturing index (April): Still strong. Unlike the Philadelphia Fed index, the manufacturing indicator from the Dallas Fed was not particularly elevated last month. A steep decline therefore looks unlikely for this measure.
Median forecast (of 5): +13.4; Last +11.5.
11:00: $6-8 billion POMO; After a one day absence on Friday, Brian Sack is back in the market, gobbling up 10/31/2016-03/31/2018. Proceeds today will liekly be used not to buy Netflix but to fund silver (and gold) margin calls.
From Goldman and Zero Hedge
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