Most all euro area indicators still in collapse due to tariffs:

Production held up even as consumer spending slowed:

Highlights

The outcome was expected but not the mix. The third estimate of first-quarter GDP rose 3.1 percent and is unchanged from the second estimate. But consumer spending did not live up to expectations, at only a 0.9 percent growth rate in the quarter vs 1.3 percent in the prior estimate and expectations for 1.3 percent.

Making up the difference is an upgrade to nonresidential fixed investment, now at a 4.4 percent growth rate vs 2.3 percent in the second estimate, and also an upgrade to residential investment which is now at 2.0 percent contraction vs the second estimate’s 3.5 percent contraction. Government purchases are also upgraded, by 3 tenths to plus 2.8 percent.

Stepping back and looking at the quarter as a whole, inventory growth (contributing 0.55 percentage points to the 3.1 percent overall rate) and especially net exports (contributing 0.94 points) skewed the quarter higher. Sharp inventory growth made up for thin levels in prior quarters but with inventories still rising so far in the second quarter raise the question, given the slowing in consumer spending, whether inventories will begin to slow and pull down GDP. Net exports so far in the second quarter are clearly negative as imports are widening vs exports. Excluding both inventories and net exports, GDP on this basis (final sales to domestic purchasers) rose only 1.6 percent in the first quarter for a 5 tenths decline from the fourth quarter.

It’s been a weak recovery for the consumer, and now it’s fading:

Corporate profits had ‘one time’ increase from the 2018 tax cuts, but have subsequently gotten hurt by Agent Orange’s tariffs:

Back down from already depressed levels even as mortgage rates fall:

US New Home Sales Fall Unexpectedly

Sales of new single-family houses in the US dropped 7.8% from the previous month to a seasonally adjusted annual rate of 626 thousand in May, compared to market expectations of a 1.9% increase, as purchases plunged in the West and Northeast. It was the lowest sales since December despite lower mortgage rates and solid job market.

US Home Price Growth Eases to 7-Year Low: Case-Shiller

The S&P CoreLogic Case-Shiller 20-city home price index in the US rose 2.5 percent year-on-year in April 2019, easing from a revised 2.6 percent increase in the previous month and missing market expectations of 2.6 percent. It was the smallest annual gain in house prices since August 2012. Las Vegas recorded the biggest increase in home prices (7.1 percent), followed by Phoenix (6.0 percent) and Tampa (5.6 percent), while the smallest gains were reported in San Diego (0.8 percent), Los Angeles (1.5 percent) and San Francisco (1.8 percent). Prices in Seattle were unchanged. The national index, covering all nine US census divisions, went up 3.5 percent in April, down from a 3.7 percent rise in the prior month.

Richmond Fed report:

Fifth District Manufacturing Activity Below Forecasts

The Manufacturing Activity Index in the US fifth district fell to 3 in June 2019 from 5 in May, below market consensus of 7. Employment (2 from 17 in May), raw materials (27 from 37) and finished goods (21 from 26) dropped. Meanwhile, shipments (7 from 2) and new orders (1 from 0) improved. On the price front, price pressures eased for prices paid (1.58 from 2.21) while accelerated for prices received (1.68 from 1.53). Firms were optimistic about growth in the coming months.

Consumer confidence drops more than expected, reaching its lowest point in nearly two years

Tariffs:

Bank lending deceleration:

Real estate has gone nowhere:

Gone flat this entire cycle:

Last month’s uptick hinted at a reversal, but this month’s large move back down says otherwise:

Still rolling over, and from depressed levels relative to prior cycles, and these charts are not population adjusted which only makes it worse:

Last months spike up that was hailed as a turn around now looks like an aberration:

NY Manufacturing Falls The Most on Record

The New York Empire State Manufacturing Index plummeted 26.4 points from the previous month to -8.6 in June, missing market expectations of +10. That was the largest monthly decline on record, due to drop in both new orders and employment, while shipments increased at a slower pace.

The Trump tax cuts gave a one time boost to earnings, and now the tariffs are working against earnings:

Imports and exports both decelerating:

Still in contraction:

Trump says ‘devalued’ currencies put US at a disadvantage and the Fed doesn’t have a ‘clue’

President Donald Trump said Tuesday the U.S. dollar is at a disadvantage compared to other major currencies like the euro as other central banks keep interest rates low while the Federal Reserve’s rates are higher by comparison.

“The Euro and other currencies are devalued against the dollar, putting the U.S. at a big disadvantage,” Trump tweeted, adding the Fed doesn’t have “a clue.”

Trump also said in a separate tweet the U.S. has low inflation, calling it “a beautiful thing.”

Seems the President like tariffs because they are very profitable for the Treasury:

“We can always go back to our previous, very profitable position on tariffs — but I don’t believe that will be necessary,” the president said in a Twitter post Sunday.

The deal to avert tariffs that President Trump announced Friday with great fanfare consists largely of actions that Mexico had already promised to take, officials from both countries said.