Economic Weekly May 8, 2026
This weekly email has three parts: the Schedule of economic data for the following week, a Review of data for the previous week, and a brief Commentary on a current topic.
Schedule for Week of May 10, 2026
The key reports this coming week are the April CPI, Retail Sales and Existing Home sales.
----- Monday, May 11th -----
10:00 AM: Existing Home Sales for April from the National Association of Realtors (NAR). The consensus is for 4.05 million SAAR, up from 3.98 million in March. This graph shows existing home sales, on a Seasonally Adjusted Annual Rate (SAAR) basis since 1994.
----- Tuesday, May 12th -----
6:00 AM ET: NFIB Small Business Optimism Index for April.
8:30 AM: The Consumer Price Index for April from the BLS. The consensus is for a 0.6% increase in CPI, and a 0.4% increase in core CPI. The consensus is for CPI to be up 3.4% Year-over-year (YoY), and core CPI to be up 2.7% YoY.
11:00 AM: NY Fed: Q1 Quarterly Report on Household Debt and Credit
----- Wednesday, Wednesday, May 13th -----
7:00 AM: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.
8:30 AM: The Producer Price Index for April from the BLS. The consensus is for a 0.5% increase in PPI, and a 0.3% increase in core PPI.
----- Thursday, May 14th -----
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for initial claims to increase to 205 thousand from 200 thousand last week.
8:30 AM: Retail sales for April is scheduled to be released. The consensus is for a 0.4% increase in retail sales.
----- Friday, May 15th -----
8:30 AM: The New York Fed Empire State manufacturing survey for April. The consensus is for a reading of 8.1, down from 11.0.
9:15 AM: The Fed will release Industrial Production and Capacity Utilization for February. The consensus is a 0.2% increase in Industrial Production, and for Capacity Utilization to increase to 75.9%.
Review of Week of May 3, 2026
Real Estate Newsletter:
• New Home Sales Increase to 682,000 Annual Rate in March
• Asking Rents Continue to Decline Year-over-year
• 2nd Look at Local Housing Markets in April
• 1st Look at Local Housing Markets in April
Other economic data:
Data was mostly close to expectations last week, with employment gains higher than expected.
• Oil and Gas prices. WTI oil prices are at $96 per barrel as of this writing, up almost 50% since late February. The national average gasoline price is $4.56 per gallon, up over 50% since late February.
Total nonfarm payroll employment edged up by 115,000 in April, and the unemployment rate was unchanged at 4.3 percent, the U.S. Bureau of Labor Statistics reported today.
This was well above the consensus forecast of 73,000 jobs added. The previous two months were revised down. The economy has only added 251,000 jobs over the last year.
• U.S. International Trade in Goods and Services for March
The U.S. Census Bureau and the U.S. Bureau of Economic Analysis announced today that the goods and services deficit was $60.3 billion in March, up $2.5 billion from $57.8 billion in February, revised.
March exports were $320.9 billion, $6.2 billion more than February exports. March imports were $381.2 billion, $8.7 billion more than February imports.
The trade deficit was slightly larger than consensus estimates.
• Job Openings and Labor Turnover Survey for March
The number of job openings was unchanged at 6.9 million in March, the U.S. Bureau of Labor Statistics reported today. Over the month, hires increased to 5.6 million while total separations changed little at 5.4 million.
This graph shows job openings (black line), hires (dark blue), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS. Jobs openings decreased in March to 7.15 million from 7.45 million in February. The number of job openings (black) were down 11% year-over-year.
• ISM Services Index for April
“In April, the Services PMI® registered 53.6 percent, a decrease of 0.4 percentage point compared to March’s figure of 54 percent. … The Employment Index contracted for the second month in a row with a reading of 48 percent, a 2.8-percentage point increase from the 45.2 percent recorded in March.”
The employment index increased, but remained weak.
• The mortgage purchase applications index from the Mortgage Bankers Association (MBA).
The seasonally adjusted Purchase Index decreased 4 percent from one week earlier. The unadjusted Purchase Index decreased 3 percent compared with the previous week and was 5 percent higher than the same week one year ago.
• ADP Employment Report for April.
Private employers added 109,000 jobs in April
This was above consensus expectations.
• The initial weekly unemployment claims report.
In the week ending May 2, the advance figure for seasonally adjusted initial claims was 200,000, an increase of 10,000 from the previous week’s revised level. The previous week’s level was revised up by 1,000 from 189,000 to 190,000.
This was close to expectations.
• Construction Spending for February and March.
Construction spending during March 2026 was estimated at a seasonally adjusted annual rate of $2,185.5 billion, 0.6 percent above the February estimate of $2,173.2 billion. The March figure is 1.6 percent above the March 2025 estimate of $2,150.8 billion
Construction spending remains weak.
Commentary: The Inflation “Surge”
A key economic story is the current surge in inflation related to the Iran war and much higher oil and gasoline prices.
Economists at BofA put out a research comment this week noting:
April CPI should continue to show the effects of the Iran war. We forecast a 0.5% m/m (0.51%, 3.7% y/y) increase in headline CPI, owing in large part to a 4.3% m/m pop in energy. Core CPI, meanwhile, likely rose by 0.3% m/m (0.29%, 2.7% y/y) reflecting the payback in rents from the shutdown and sticky non-housing services inflation. We think the risks to our forecasts are skewed to the upside for both headline and core inflation.
How long this “surge” in inflation lasts is a key unknown. It depends on when the war ends, and how quickly energy shipments return to pre-war levels.
Will the surge in energy prices spillover into other prices? It is not just gasoline. Diesel, jet fuel, fertilizer and other petroleum related products are seeing sharp price increases. And we might start seeing some spillover into other items.
And inflation expectations have increased. Here is a graph from FRED of 5-year inflation expectations. Note the recent increase. However, in general, inflation expectations are still mostly contained.
Given the surge in inflation, the FOMC will remain on hold for some time, and might lean towards raising rates if there is spillover into other items and / or inflation expectations continue to increase.
Markets continue to move higher. but not without tension beneath the surface.
The recent rally in U.S. equities, led by technology and AI-driven momentum, reflects strong earnings, resilient economic data, and continued confidence in future growth.
On the surface, everything looks stable.
But the foundation tells a more complex story.
Because while innovation is driving optimism, external pressures are quietly building at the same time.
Rising oil prices are reintroducing inflation concerns.
Geopolitical tensions are increasing uncertainty.
And strong economic data is reducing the urgency for central banks to ease policy.
This creates a unique dynamic:
Growth is strong enough to push markets higher
but risk is present enough to prevent full conviction.
Investors are no longer operating in a clear environment.
They are balancing two opposing forces:
The promise of acceleration,
and the reality of constraint.
And that balance is what defines this moment.
Because this rally is not built on perfect conditions
It is built on the ability of markets to move forward despite imperfect ones.
Which makes it resilient
But also highly sensitive.
The direction is upward.
But the margin for error is getting smaller.