Health Care, Finance Sales Help Maintain Services Revenue Growth
1 hr 1 min ago
Revenues in the services sector remained strong in the fourth quarter, a survey showed today.
The Census Bureau reported total revenue from the services sector was up 6.6% from the same time in the year prior, and up 1.9% from the third quarter.
Health care revenue led the way, with quarterly revenue up 10.6% over last year, followed by finance and insurance sales that rose 9.8% on the year. Education sales were up 9% and real estate revenue grew 8%.
Transportation and warehousing was one sector of the services industry that declined in the fourth quarter, dropping 3.1% from last year, though improving from the prior quarter.
The services sector has been one area that Federal Reserve officials have been watching for inflation. The services sector is also closely tied to wages, which can press inflation higher if they grow too fast.
-Terry Lane
UK Returns to Growth After Falling Into Recession Territory
1 hr 28 min ago
The U.K. economy returned to growth in January, after falling into a technical recession at the end of last year.
Gross Domestic Product (GDP) rose by 0.2% in the country, more than the 0.1% economists expected, according to a poll conducted by The Wall Street Journal. It’s also up after December’s 0.1% contraction.
The U.K. economy struggled more than its peers in the latter half of 2023 and was the only country out of the Group of Seven whose GDP fell in the third and fourth quarters. The country has felt larger impacts from economic issues also facing the U.S.
Like America’s Federal Reserve, the Bank of England is attempting to wrangle inflation. But unlike in the U.S., consumer prices peaked at 11.1% in October 2022. That’s well after inflation in America reached its June 2022 height of 9.1%.
-Nisha Gopalan
Mortgage Applications Jump as Rates Dip Below 7%, Refinancing Surges
3 hr 13 min ago
More prospective homeowners applied for mortgages last week, acting as the interest rates dipped on weaker economic data, the Mortgage Bankers Association (MBA) reported Wednesday.
The MBA’s Market Composite Index rose 7.1% for the week ending March 8 compared to the week earlier. The industry group’s report said refinancing jumped 12% and purchases increased by 6% over the week prior. However, purchases are still down about 11% compared to last year.
Homebuyers jumped on a dip in interest rates, down to 6.84% for a fixed 30-year mortgage this week, the MBA said.
“Mortgage rates dropped below 7% last week for most loan types because of incoming economic data showing a weaker service sector and a less robust job market, with an increase in the unemployment rate and downward revisions to job growth in prior months,” said Mike Fratantoni, MBA senior vice president and chief economist.
With mortgage rates near highs not seen in nearly two decades, few borrowers have sought to refinance their loans, but refinancing activity rebounded this week. However, that number is still historically low.
“While these percentage increases are large, the level of refinance activity remains quite low, and we expect that most of this activity reflects borrowers who took out a loan at or near the peak of rates in the past two years,” Fratantoni said.
-Terry Lane
