New-home sales rebound in August
WASHINGTON – Sales of new U.S. homes rebounded in August, posting the fastest growth since January, according to government data released Wednesday.
Sales of new U.S. homes rose 7.9 percent – the fastest growth since the beginning of the year – to a seasonally adjusted annual rate of 421,000 in August, with rising results in three of four regions, according to the U.S. Department of Commerce.
Economists polled by MarketWatch had expected sales to climb in August to a rate of 420,000, compared with an original July estimate that pegged the rate at 394,000. On Wednesday, the government revised July’s rate to 390,000.
The new-home-sales series is volatile, and monthly results can be difficult to interpret. In August, the confidence interval for new-home sales was plus or minus 14.6 percent, meaning government analysts think that sales growth likely fell somewhere within a range of negative-6.7 percent to 22.5 percent.
Though there are signs that rising mortgage rates are slowing the housing market – the average rate for the popular 30-year fixed-rate mortgage has climbed more than 1 percentage point since early May – Wednesday’s data point to a housing market that continues to gather steam.
Justice seeks $11 billion to settle with JPMorgan
ALBANY, N.Y. – An $11 billion national settlement is under discussion to resolve claims over JPMorgan’s handling of mortgage-backed securities in the run-up to the recession, said a government official familiar with ongoing negotiations among bank, federal and New York state officials.
The Department of Justice is taking the lead on the settlement, which would include $7 billion in cash and $4 billion in consumer relief, said the official, who spoke Wednesday with the Associated Press on the condition of anonymity because a settlement hasn’t been reached and the official wasn’t authorized to discuss it publicly.
The government has continued investigating JPMorgan over mortgage-backed securities, which lost value after a bubble in the housing market burst and helped spur the financial crisis.
The company declined to comment Wednesday.
Durable goods orders improve in August
WASHINGTON – Companies placed slightly more orders in August for U.S. long-lasting manufactured goods, stepping up demand for cars, trucks and machinery. Even with the gain, business spending on factory goods may not be strong enough to accelerate economic growth in the July-September quarter.
Orders for durable goods, items expected to last at least three years, increased 0.1 percent in August, the Commerce Department said Wednesday. That comes after orders plummeted 8.1 percent in July, which was largely because of a steep drop in volatile commercial aircraft orders.
The August orders were held back by a decline in demand for defense aircraft and other military goods. That could be related to steep government spending cuts that took effect in March. Excluding defense spending, orders rose 0.5 percent.
Auto factories reported a 2.4 percent increase in orders, the biggest in six months.
And demand for so-called core capital goods rose 1.5 percent, after falling 3.3 percent the previous month. Core capital goods are a good measure of businesses’ confidence in the economy and include items that point to expansion, such as machinery and computers.