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Thursday, March 28, 2024 | Back issues
Courthouse News Service Courthouse News Service

U.S. Economy

(CN) - U.S. homebuilders are feeling less optimistic about their sales prospects, the National Association of Home Builders reported Monday.

That finding was part of the latest National Association of Home Builders/Wells Fargo builder sentiment. It found the overall score of the index fell one point in the past month, to 59.

Readings above 50 indicate more builders view sales conditions as good, rather than poor. The index had mostly held at 58 this year before rising to 60 last month.

Builders' view of current sales and traffic by prospective buyers slipped one point this month. Their outlook for sales over the next six months dropped three points.

The assessment follows a recent slowdown in the sales of new homes across the nation.

Sales declined 6 percent in May to a seasonally adjusted annual rate of 551,000 homes, although sales still remain ahead of last year's pace.

In other economic news, foreign ownership of US debt Fell in May, the second straight month of declines.

The Treasury Department said Monday that total foreign holdings dropped 0.5 percent to $6.21 trillion after falling 0.8 percent to $6.24 trillion in April.

. China, the biggest foreign investor in Treasurys, increased its holdings slightly to $1.24 trillion.

Japan, the second-biggest foreign owner of Treasury securities, reduced its holdings by 0.8 percent to $1.13 trillion.

Mexico cut its Treasury holdings by 9.3 percent to $59.8 billion.

The national debt is nearly $19.4 trillion and is expected to grow, which means the United States needs international investors to keep buying Treasury securities.

Of the debt total, nearly $14 trillion is publicly traded on financial markets. The rest is money the government owes itself, including holdings in the Social Security trust fund.

Additionally, the Producer Price Index for final demand increased 0.3 percent over the year ended June 2016. Prices for final demand services (+1.5 percent) and final demand construction (+2.0 percent) both increased, while the index for final demand goods was down 2.2 percent. Services make up 64.3 percent of the final demand index, goods account for 33.6 percent, and construction is less heavily weighted at 2.1 percent.

The Labor Department's Bureau of Labor Statistics said within final demand services, prices for trade services rose 2.8 percent from June 2015 to June 2016. Prices for services less trade, transportation, and warehousing rose 1.5 percent over the same period. These increases more than offset a decrease in prices for transportation and warehousing services (-2.5 percent).

Within final demand goods, the price index for energy was down 11.4 percent over the year. Prices for foods declined 2.3 percent. Prices for final demand goods less foods and energy increased 0.5 percent.

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