Economic Updates

The Institute for Supply Management reported that the monthly index of manufacturing activity was 60.4 in April, after reaching 59.6 in March. It was the ninth straight month of expansion and the best reading since June 2004. A reading above 50 signals expansion.

Total construction spending rose 0.2% to $847.3 billion in March, following a revised 2.1% drop in February. The increase was largely due to a 2.3% surge in public construction spending.

Factory orders rose 1.3% in March, much better than the 0.1% decline economists had anticipated. It was the seventh straight gain and follows an upwardly revised 1.3% increase in February.

The National Association of Realtors reported that its pending home sales index, a forward-looking indicator based on signed contracts, rose 5.3% in March, after a revised 8.3% increase in February. On a year-over-year basis, pending home sales are up 21.1%.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications for the week ending April 30 rose 4%. Purchase volume increased 13%. Refinancing applications fell 2.1%.

The Institute for Supply Management reported that the monthly composite index of non-manufacturing activity was 55.4 in April, unchanged from 55.4 in March. A reading above 50 signals expansion. Economists had anticipated a reading of 56.

Employers added 290,000 jobs in April, following a revised 230,000 advance in March. The April increase was the most since March 2006. The improving economy is encouraging more people to seek employment. This pushed the unemployment rate from 9.7% in March to 9.9% in April.

Upcoming on the economic calendar are reports on wholesale trade on May 11, international trade on May 12 and retail sales on May 14.

Provided by:

Judy Haller

Prospect Mortgage

3985 Prince William Co. Pky., Suite 104

Woodbridge, VA 22192

Office: (703) 590-7132