US Home Builder Sentiment Falls

Home builder sentiment just plummeted to the lowest level in 13 years for the month of May.

The last time sentiment was this low, it was the 2007-2012 housing collapse.

Builders are reporting very low traffic, increased use of price cuts, and are giving sales incentives on over 60% of listings.

Meanwhile, we have the highest level of spec builder inventory on the market since 2009.

This is bad news for people who want home prices to go up. 

This is good news for prospective buyers - things are about to get cheaper.

US Weather Update

There is currently a drought.

Credit Ratings By Agency

US Home Prices : Inflation-Adjusted

These are the highest US Home prices in US history, adjusted for inflation.

US Credit Card Delinquencies

Serious Credit Card Delinquencies rise to 12.31%, the highest level since 2011.

Mexico Interest Rate

The Bank of Mexico lowered its key rate by 50 bps to 8.50% on May 15th, as annual inflation eased to 3.93% in April and the domestic economy registered a modest 0.2% quarter-on-quarter expansion after earlier weakness. 

The release indicated that the Board could continue calibrating similar 50 bps cuts, anticipating that the disinflation process will allow a further easing cycle while maintaining a restrictive stance. 

However, the central bank remains cautious amid elevated global uncertainty—ranging from US trade tensions to geopolitical conflicts—that could either reignite inflation via peso depreciation or deepen the economic slowdown. 

While progress towards the 3% inflation target is on track, with forecasts pointing to convergence by the third quarter of 2026, members underscored the importance of a flexible policy framework to manage inflation expectations and preserve financial stability, particularly given the peso's recent appreciation. 

source: Banco de México

US Retail Sales

US retail sales rose by 0.1% mom in April 2025, following an upwardly revised 1.7% surge in March. 

The modest gain suggests consumers scaled back spending in response to a wave of tariff announcements in early April, yet the result still exceeded market expectations for no change. 

Biggest increases were seen in sales at food services and drinking places (1.2%), building material and garden equipment supplies dealers (0.8%), furniture (0.3%) and electronics and appliances stores (0.3%). 

On the other hand, the largest decreases were recorded at sporting goods, hobby, musical instrument, & book stores (-2.5%), miscellaneous store retailers (-2.1%), gasoline stations (-0.5%), clothing (-0.4%), health and personal care (-0.2%) and general merchandise stores (-0.2%). 

Meanwhile, sales excluding food services, auto dealers, building materials stores and gasoline stations, which are used to calculate GDP, were down 0.2%, below an upwardly revised 0.5% gain in March and forecasts of a 0.3% rise.

source: U.S. Census Bureau

US Producer Price Inflation MoM

US producer prices fell by 0.5% in April 2025, following a revised flat reading in March and defying market expectations of a 0.2% increase. 

This was the first decline in the PPI since October 2023 and the sharpest drop since April 2020, during the early aftermath of the COVID-19 outbreak. 

The decline was largely driven by a 0.7% fall in service costs, the largest since data collection began in December 2009, primarily due to a 1.6% decrease in margins for trade services, suggesting businesses may be absorbing some of the impact from higher tariffs. 

Prices for final demand services excluding trade, transportation, and warehousing fell 0.3%, while transportation and warehousing services dropped 0.4%. 

Meanwhile, goods prices were flat in April, as a 1.0% decrease in food costs and a 0.4% decline in energy prices offset other components. 

On a yearly basis, the PPI inflation eased to 2.4% in April, the lowest since September 2024 and slightly below forecasts of 2.5%. 

source: U.S. Bureau of Labor Statistics