This year’s active hurricane season continues to effect the U.S. economy in different ways.
The U.S. National Association of Realtors today reported that sales of existing homes were unchanged in September at a seasonally adjusted annual rate of 7.28 million, the same as August and the second-highest level on record. The association said sales would have fallen without the increased demand for houses because of the devastation from hurricane Katrina.
September’s existing-home sales tally was stronger than the 1.2% decline economists had been forecasting, thanks largely to hurricane refugees being flushed into neighboring housing markets. Katrina had a major impact on sales in areas where it hit, the Realtors said. Sales plunged by 85% in New Orleans but were up 150% in nearby Baton Rouge.
Meanwhile, U.S. consumer confidence dropped for a second straight month and slipped to the weakest level in two years in October as consumers worried about the impact of the recent hurricanes, particularly high gasoline prices.
The U.S. Conference Board’s index of consumer confidence for the current month fell to 85.0 from a revised 87.5 in September and 105.5 in August.
The October reading was the worst showing since the 81.7 seen in October 2003.
Other components of the report fared poorly, too: the present-situation index fell to 108.2 from September’s 110.4, while the expectations index slipped to 69.5 from 72.3.
“Much of the decline in confidence over the past two months can be attributed to the recent hurricanes, pump shock and a weakening labor market,” said Conference Board economist Lynn Franco, in a release.
Hurricanes prop up U.S. home resales
Consumer confidence drops for second straight month
- By: IE Staff
- October 25, 2005 October 25, 2005
- 10:20