New residential furniture orders in July 2023 were up 28% over July 2022, according to a new report from Smith Leonard,  which produces the monthly Furniture Insights newsletter. But, that isn't the whole story.

"July 2022 new orders were down 37% from July 2021 when they were down 11% from July 2020. But July 2020 orders were way up," said Ken Smith, CPA, managing partner at Smith Leonard.  

Follow that?

"As we have said, comparisons today are difficult," said Smith. "Just read the quarterly reports from the public companies and then compare their results back for the same periods to the last few years. Year to date, new orders were down 4% from last year when they were down 29% from 2021. For July 2023, new orders year to date were down for 63% of the participants. Shipments were down 21% in July versus July 2022.

Backlogs continued to return closer to more normal levels, though a few remained higher. Inventories increased a bit from June levels but were 28% below last July. The number of factory and warehouse employees as well
as payrolls continued to drop as would be expected. 

Consumer Confidence
The Conference Board Consumer Confidence Index® declined again in September to 103.0, down from an upwardly revised 108.7 in August.

The Present Situation Index rose slightly to 147.1 from 146.7. The Expectations Index declined to 73.7 in September, after falling to 83.3 in August. Expectations fell back below 80—the level that historically signals a
recession within the next year. Consumer fears of an impending recession also ticked back up, consistent with what they anticipate for the first half of 2024.

Dana Peterson, Chief Economist at The Conference Board said, “Write-in responses showed that consumers continued to be preoccupied with rising prices in general and for groceries and gasoline in particular. Consumers also expressed concerns about the political situation and higher interest rates.”

The Conference Board Leading Economic Index® (LEI) for the U.S. declined by 0.4% in July 2023, following a decline of 0.7% in June. The LEI is down 4.0% over the six months between January and July 2023. The report indicated that the outlook “remains highly uncertain. The leading index continues to suggest that economic activity is likely to decelerate and descend into mild contraction in the months ahead. The Conference Board now forecasts a short and shallow recession in the Q4 2023 to Q1 2024 timespan.”

Housing
Existing-home sales slipped again in August with the four regions reporting sales improved in the Midwest, unchanged in the Northeast, and slipped in the South and West. All four regions recorded year-over-year sales declines.

Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums, and co-ops – slid 0.7% from July. Year-over year, sales fell 15.3%.

Single-family home sales fell 1.4% from 3.65 million in July and 15.3% from the previous year. The median existing single-family home price was $413,500 in August, up 3.7% from August 2022. All four U.S. regions posted price increases.

Sales of new single‐family houses in August 2023 were at a seasonally adjusted annual rate of 675,000, which was 8.7% below the revised July rate of 739,000, but 5.8% above the August 2022 estimate of 638,000. Privately‐owned housing starts in August were at a seasonally adjusted annual rate of 1,283,000 and were 11.3% below the revised July estimate and 14.8% below the August 2022 rate. Single‐family housing starts in August were 4.3% below the revised July figure.

Comparing August 2023 to August 2022, single-family starts were up 2.4%. Regionally starts were down 10.0% in the Northeast, 15.1% in the Midwest, and 12.8% in the West but were up 14.6% in the South.

Other Advance estimates of U.S. retail and food services sales for August 2023 were up 0.6% from the previous month, and up 2.5% above August 2022. Total sales for the June 2023 through August 2023 period were up 2.2% from the same period a year ago.

Retail trade sales were up 0.6% from July 2023, and up 1.6% above last year. Gasoline stations were down 10.3% from last year, while food services and drinking places were up 8.5% from August 2022.

Sales on an adjusted basis at furniture and home furnishings stores were down 7.2% from August 2022. On an unadjusted basis, sales at these stores were down 4.3% year to date.

The Consumer Price Index (CPI-U) rose 0.6% in August after increasing 0.2% in July. Over the last 12 months, the all-items index increased 3.7% before seasonal adjustment. The all items less food and energy index rose 4.3% over the last 12 months. The energy index decreased 3.6% for the 12 months ending August, and the food index increased 4.3% over the last year.