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Economy Report

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With the pandemic gripping nearly every sector of the economy, oil prices dropped to their lowest level since 1986 before recovering somewhat, according to The Wall Street Journal, and the National Association of Manufacturers issued a report saying that global growth is grinding to an “unprecedented halt.”

The IHS Markit Flash U.S. Manufacturing PMI declined in April at the fastest rate since March 2009, according to NAM’s Chad Moutray, as the sector struggles with the covid-19 outbreak and “significant demand and production disruptions.”

At the same time, with many consumer-facing businesses closed and more Americans staying closer to home, the IHS Markit Flash U.S. Services Business Activity Index declined from 39.8 to 27, a record low, according to NAM.

Europe’s manufacturing rate also declined at its fastest rate since early 2009, with the IHS Flash Eurozone Services PMI Activity Index dropping from 26.4 to 11.7 — a result Moutray called a “jaw-dropping record low.”

Manufacturers in the Kansas City Federal Reserve Bank’s district reported the strongest decline in activity in the survey’s history, dating to 1994. That mirrored “dismal releases” from the New York and Philadelphia Federal Reserve Banks last week, Moutray wrote.

New single-family home sales declined 15.4 percent in March to a seasonally adjusted annual rate of 627,000 units, according to the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.

All four U.S. regions reported a decline in new-home sales — down 41.5 percent in the Northeast, 8.1 percent in the Midwest, 0.8 percent in the South, and 38.5 percent in the West, according to Mortgage Professional America.

“Despite the sharp decline in new-home sales this month, the first quarter of 2020 was actually 6.7 percent higher than the same period last year, reflecting a strong pace prior to the virus outbreak,” Dean Mon, chairman of the National Association of Home Builders, told the publication. “While we expect to see some further impacts on the industry, we remain confident that housing will be a sector that will help lead the economic recovery.”

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