Pending Home Sales Rise, Retail Sales Surprise

Pending home sales ticked up in March, retail sales beat expectations, and jobless claims highlight continued shifts in how people work. Here are the key takeaways.

·       Pending Home Sales See Modest March Uptick

·       Retail Sales Rise, Driven by Higher Gas Prices

·       Jobless Claims Reflect Shifting Work Trends

Pending Home Sales See Modest March Uptick

Pending home sales, which reflect signed contracts on existing homes, rose 1.5% from February to March, exceeding expectations. While activity remains somewhat below this time last year, the monthly increase is a positive sign. The Northeast and South led the gains, while the Midwest and West experienced some slowdown.

What’s the bottom line? Buyers remain active despite higher mortgage rates, pointing to ongoing pent-up demand, according to Lawrence Yun of the National Association of Realtors®. He noted that increased inventory will be key to converting that demand into closed sales.

Retail Sales Rise, Driven by Higher Gas Prices

Retail sales increased 1.7% in March, topping economists’ forecasts. Core retail sales, which exclude autos, gas, building materials, and food services, also came in stronger than expected, rising 0.7%. This core measure is important because it feeds directly into GDP. However, even though gas is excluded, higher fuel costs can still push up prices across other categories, which may be boosting the overall numbers.

What’s the bottom line? Much of the increase was driven by a sharp jump in gasoline spending, as higher oil prices led consumers to pay more at the pump – not necessarily because overall spending has increased. That means the headline strength may not reflect a surge in broader economic activity. If elevated energy prices continue, it will be important to watch whether spending on discretionary items starts to slow.

Jobless Claims Reflect Shifting Work Trends

Initial jobless claims edged up by 6,000 to 214,000 in the latest week, remaining low by historical standards. Meanwhile, continuing claims (those receiving benefits beyond the first week) increased by 12,000 to 1.821 million.

What’s the bottom line? The broader unemployment trends have been holding in a similar pattern for sometime. Low levels of new claims may partly reflect the growing role of gig and contract work, with some displaced workers turning to flexible income opportunities instead of filing for unemployment, especially since benefits often don’t fully cover living expenses.

Meanwhile, continuing claims remain elevated, suggesting that those who are unemployed are taking longer to find new jobs. Because these claims have stayed high for an extended period, some individuals may also be nearing or reaching the end of their benefits.