Weak, a bit below expectations, and not much hope left for Q2 either.

And some time last year the govt changed the seasonal adjustments, adding a bit to Q1 and taking some away from the other quarters. So this release included that new seasonal adjustment:

GDP

Highlights
Consumer spending, largely on services, helped hold up first-quarter real GDP which came in at an annualized plus 0.5 percent rate and just below the Econoday consensus for 0.7 percent. Consumer spending (personal consumption expenditures) rose at a 1.9 percent rate, down only 5 tenths from the fourth quarter. Within this, spending on services rose an in-trend 2.7 percent to offset a 1.6 percent decline in durable goods which were hit by weak vehicle sales.

Residential investment, up 14.8 percent, is a highlight of the report and helped offset a sharp 5.9 percent decline in nonresidential investment where weak energy drilling is taking a big toll. Inventories rose in the quarter but at a slower rate which is a negative for GDP while exports, reflecting weak global demand, were a negative for a second quarter in a row. Government purchases were a small plus in the quarter.

Price data are mixed with the price index up only 0.7 percent in the quarter, down 2 tenths from the fourth quarter. But the core deflator is up, 7 tenths higher to plus 1.9 percent which should get some attention.

The consumer bailed out the first quarter, both on services and also on fixing on their homes. But otherwise the report points to nearly no momentum going into the Spring quarter.

US GDP Growth Slows to 0.5% in Q1

The US economy expanded an annualized 0.5% percent on quarter in Q1, according to the advanced estimate released by the Bureau of Economic Analysis. It is the weakest performance since Q1 2014 as consumer spending slowed, the drag from trade and business inventories worsened and business investment fell for the third straight quarter.

As previously discussed, health care premium count as personal consumption expenditures and GDP, so last year they spiked due to new people being covered by Obamacare, thereby supporting GDP by that much. But that was a one time event and so now consumption, so measured, is softening to where it probably has been all along:


Still negative:

Kansas City Fed Manufacturing Index

Highlights
Oil prices may be higher but steady contraction is the long uninterrupted theme of the Kansas City Fed manufacturing sector where the composite index came in at minus 4 for April. Contraction in new orders is only marginal, at minus 2 for a second straight month, but contraction for backlog orders, at minus 18, remains severe. Employment is also in deep contraction, at minus 12. Output indicators are also weak, at minus 8 for production and minus 9 for the workweek. Selling prices remain in contraction, at minus 6, but raw material prices, at 4, are back in the plus column and reflect the turn around for oil prices. But higher oil prices have yet to give this report much boost where weakness in energy equipment has been a long fixture. Weakness in export orders, at minus 4, has been another fixture.

Still weak and worse than expected.

And prices weakening as well:

New Home Sales

Highlights
Growth in new homes isn’t spectacular but, given how soft general economic conditions are, the sector is posting moderate and still respectable numbers. March sales came in at a 511,000 annualized rate which is on the low side of expectations but the report includes a 7,000 upward revision to 519,000 for February which now stands as among the very best months since 2008. Year-on-year, sales are up 5.4 percent, right in line with permits which are up 4.6 percent.

Lack of new homes on the market, which has been holding down sales, improved a bit in April, to 246,000 units for a 2.1 percent monthly gain. And sales relative to supply is also improving, to 5.8 months vs 5.6 months in February and 5.1 months a year ago. Supply at 6.0 months relative to sales is generally considered to be consistent with a balanced market.

New homes aren’t showing much price traction, down 3.2 percent in the month to a median $288,000 which is down, not up, 1.8 percent from last year.

Still negative and worse than expected:

Dallas Fed Mfg Survey

Highlights
The decent of the Dallas Fed report may be flattening out, hopefully. The production index posted its second straight positive reading, at 5.8 in April vs 3.3 in March, but the really good news is new orders which popped into the plus column, to 6.2 following four straight declines. Capacity utilization is another plus, up for a second month.

Still, the overall assessment is negative, at minus 13.9 for the general activity index which is a 16th straight negative score, a run that can be traced back directly to the collapse in oil prices. Employment remains weak, at minus 3.7 for a fourth straight contraction. Price data do show some life with wages up and raw materials, which had been week, also up. Selling prices, however, remain a big negative, at minus 6.6 for what is also a 16th straight month in the wrong column.

More bad stuff:

PMI Manufacturing Index Flash

Highlights
Early indications on April factory conditions are no better than mixed with strength in the Empire State report offset by yesterday’s flat readings from the Philly Fed and another set of flat readings from today’s PMI flash. The PMI, at 50.8, is still over 50 to indicate monthly growth but is the least above 50 since the beginning of the recovery, in September 2009. Growth in both output and hiring is slowing as is growth in new orders which are being pulled back by contraction in export orders. The report also cites weakness in the energy sector as a continuing negative.

Backlog orders are down, which is a negative for hiring and also points to operating slack. Manufacturers are keeping their inventories down with stocks of purchases dropping sharply. Delivery times are up, not the result of congestion in the supply chain but, the report says, of insufficient stocks and capacity cuts among suppliers. Prices, reflecting oil, are up slightly for the first increase in 7 months.

The report, in a first of sorts compared to other reports, cites the nation’s “political climate” and its relation to the economic outlook as a possible negative. Politics aside, it may still be too soon for the factory sector to see the benefits of this year’s depreciation in the dollar and upturn for oil. One of next week’s calendar highlights will be durable goods orders for March.

Not so good here either:

Another deflationary bias:

US-led coalition incinerated $500M of ISIS cash stockpiles and cut oil revenues

A U.S.-led coalition air campaign destroyed $500 million in Islamic State cash, reports USA Today.

Whoops, back down:

Philadelphia Fed Business Outlook Survey

Same here:

Chicago Fed National Activity Index

If this is indeed falling because benefits have been made that much harder to get it means this channel of increased govt expenditures is disabled, and the cycle will get that much worse before it gets better:

Jobless Claims

Highlights
The labor market once again, against a background of soft data, shows itself as the economy’s leading positive. Initial claims fell 6,000 in the April 16 week to a much lower-than-expected 247,000. This is the lowest level since 1973 when, of course, the size of the labor market was much smaller. The 4-week average is down 4,500 to 260,500.

You can see from the chart this is not any kind of ‘engine of growth’ at this point in time:

Existing Home Sales

Highlights
Existing home sales rose more than expected in March, up 5.1 percent to a 5.330 million annualized rate that, however, fails to reverse a downwardly revised 7.3 percent drop in February. And the year-on-year rate, at only 1.5 percent, is decidedly weak. But looking at the first quarter as a whole, which is important for housing data given their volatility, existing home sales are up a much more respectable 4.8 percent.

March’s gain is led by the most important component, single-family homes where the rate rose 5.5 percent in the month to 4.760 million. Year-on-year, single-family homes are up 2.6 percent. The showing for condos is less convincing, up only 1.8 percent in the month for a year-on-year decline of 6.6 percent.

Prices in this report are up, a monthly 5.0 percent for the median for a year-on-year rate of plus 5.7 percent which closely tracks rates in FHFA and Case-Shiller data. The median price for an existing home is $222,700 which, outside of last year’s Spring selling season when the median peaked above $230,000, is the best of the recovery.

A bit of improvement for March but in general this series remains depressed compared with prior cycles:

Oil and commodity prices spiking as the $ weakens some. No way for me to tell if there’s something fundamental going on or it’s just volatility from portfolio shifting in very thin markets. (And Saudi pricing being picked up by our news services may not necessarily be what the Saudis are in fact showing their clients):