The housing market is one of the few sectors currently suffering, with rising mortgage rates, low supply, and high prices. Existing home sales fell for the fourth straight month to a 2.5-year low. New home sales are at a 10-month low. On the other hand consumer confidence is very strong and gained 5.5 points to a near 18-year high. And that confidence has shown up in surprisingly strong earnings reports recently from major retailers including Amazon, Wal-Mart, Target, Kohl’s, Tiffany, Home Depot, and Lowe’s among others. Manufacturing also continues to show strength as core orders for durable goods rose +1.4% m/m to a very strong +8.5% y/y rate. The strength of the economy was echoed in the minutes from the Fed’ most recent meeting, as well as Powell’s Jackson Hole speech, which cemented expectations for a hike in September, and made a December hike still likely.
