Data wavers but investors go risk-on

<p>Kia ora,</p><p>Welcome to Friday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the International edition from Interest.co.nz.</p><p>Today we lead with news Wall Street is rising again, partly because some large retailers like Macy’s, Dollar General and Dollar Tree all reported good results reflecting their ability to handle margin pressures from inflation's surge.</p><p>Meanwhile, <a href="https://www.dol.gov/sites/dolgov/files/OPA/newsreleases/ui-claims/20221012.pdf" target="_blank"><strong>initial jobless claims fell</strong></a> again last week in the US, but the number of people on these benefits rose marginally, but they are still below 1.3 mln and still hovering near 50 year lows.</p><p><a href="https://www.nar.realtor/newsroom/pending-home-sales-descend-3-9-in-april" target="_blank"><strong>Pending home sales also fell</strong></a> in April, and both by more than expected and by more than in March. This is an embedded trend now, taking the string of falls to six consecutive months. Higher mortgage servicing costs are hampering sales. That average prices are still rising just means those that are selling are at the higher-priced end of the market. More recently we should note that <a href="https://www.freddiemac.com/pmms" target="_blank"><strong>US mortgage interest rates dropped</strong></a> last week, for a second straight week.</p><p>Although it did fall slightly, the <a href="https://www.kansascityfed.org/Manufacturing/documents/8833/Tenth-District-Manufacturing-Kansas-City-Fed-May2022.pdf" target="_blank"><strong>Kansas City Fed manufacturing survey</strong></a> stayed historically strong in May.</p><p>Also falling slightly was the <a href="https://www.bea.gov/news/2022/gross-domestic-product-second-estimate-and-corporate-profits-preliminary-first-quarter" target="_blank"><strong>second estimate of Q1 economic activity</strong></a> in the giant American economy. As we have reported with the first estimate, it shra