Long-Term outlook for Housing Surpasses Short Term

Housing permits contracted for the third month in a row in March, but changes in the 10-year Treasury rate are a positive indicator down the line.

There were 105,700 housing permits filed in March 2019. This was the first month with more than a 100,000 permits filed since November 2018. However, permits contracted 10.1% compared with one year ago, contracting for the third consecutive month. This was the fastest rate of contraction in the one-month rate of change since June 2016. As a result, the annual rate of growth decelerated for the third-straight month, falling to 1.5%.

In March, the year-over-year change in the 10-year Treasury rate was -52 basis points, which was fifth consecutive month the change declined and the third-straight month the change was below zero. March’s change in the rate was the lowest since January 2018. This trend is a positive leading indicator for housing permits, and capital equipment spending.

The change in the 10-year Treasury rate is a good leading indicator of housing permits and construction spending. A decreasing year-over-year change in the real 10-year Treasury rate should lead to increases in these data points down the line.


Top Shops

‘Top Shops’ is a benchmarking and recognition program designed to help shops build their business.

World Machine Tool Survey

An independent annual survey that collects statistics from machine tool consuming and producing countries and compares them in real U.S. dollars.

Capital Spending Survey

An annual survey that collects statistics regarding budgeted spending on machine tools, testing equipment, software and more.

Gardner Business Index

A diffusion index measuring month-to-month changes in activity at durable goods and discrete parts manufacturing facilities.