Posted by: SMARTER BOLDER FASTER | March 25, 2009

Real Estate is Local…but this is good news!!!!!!!!!!!!!!!

Surprise rebound for U.S. goods orders and new homes


U.S. durable goods orders and new home sales showed unexpected strength in February, according to statistics released Wednesday, as both numbers rose.

 

 

CBC News

In two reports, the U.S. Census Bureau said new orders for durable goods in February increased by 3.4 per cent from January while new home sales across the United States grew by nearly five per cent.

In both cases, the actual numbers exceeded economists’ expectations, who, in the case of new orders, were predicting a two per cent gain and, in the homes sector, were 37,000 light in their projection of housing starts.

“This is only one month’s results … but this suggests the U.S. recession is stabilizing and could be turning around,” BMO economist Michael Gregory said in a commentary.

Getting ahead of a recovery

The residential figure was particularly good news, coming in the wake of Monday’s report by the National Realtors of a 5.1 per cent jump in existing homes sales.

The American housing sector has been particularly hard hit by the global credit crunch as the recession drove down property values while the asset-backed commercial paper debacle destroyed lenders’ confidence in eventual repayment.

As a result, February’s gain in housing starts was the first since July. In addition, the Census Bureau said housing prices in the second month of the year were still 18 per cent lower from one year ago.

In response, the U.S. government has been injecting trillions of new dollars into the economy and has been trying to fashion programs to help homeowners stay in their houses.

Capital gain

Perhaps better economic news is seen in February’s new orders.

In that month, American companies received an extra $5.5 billion US in new orders for everything from cars to washing machines to fabricated metal, for a total of $165.6 billion.

That was the first rise in new orders after the previous six months in which this indicator fell.

Orders for capital goods ? those items that help businesses become more productive ? rose by 11 per cent in February. Economists often consider spending on these goods as crucial to improving a country’s competitiveness.

New computer orders rose by as much as 10 per cent, depending upon the category. And defence orders jumped by 35 per cent, or $2.6 billion, in February.

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