Economic Update – August 29, 2011

Retail sales fell 1% for the week ending August 20, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3%.

New home sales fell 0.7% in July to a seasonally adjusted annual rate of 298,000 units from a downwardly revised rate of 300,000 units in June.

Orders for durable goods — items expected to last three or more years — rose 4% in July after a revised 1.9% increase in June. Excluding volatile transportation-related goods, orders posted a monthly increase of 0.7%.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 19 fell 2.4%. Refinancing applications decreased 1.7%. Purchase volume fell 5.7%.

The Commerce Department announced that gross domestic product — the total output of goods and services produced in the U.S. — increased at a revised annual rate of 1% in the second quarter of 2011, compared to the initial estimate of 1.3%. This follows a 0.4% pace of growth in the first quarter of 2011.

The Reuters/University of Michigan consumer sentiment index for August’s final reading rose to 55.7 from a preliminary reading of 54.9, which was the lowest level since May 1980.

Initial claims for unemployment benefits rose by 5,000 to 417,000 for the week ending August 20. Continuing claims for the week ending August 13 fell by 80,000 to 3.64 million, the lowest level since September 2008.