sales jump 7.9 %
Americans stepped up purchases of new homes in August after cutting back in July, suggesting that higher mortgage rates are not yet slowing the housing recovery.
Sales of new homes increased 7.9 percent last month to a seasonally adjusted annual rate of 421,000, the Commerce Department said Wednesday. That comes after sales plunged 14.1 percent in July to a 390,000 annual rate.
The rebound in sales could ease worries that higher mortgage rates have started to dampen sales. It coincided with the best month of sales for previously occupied homes in more than six years. And homebuilders remain more confident in the market than they’ve been in eight years.
New-homes sales were 12.6 percent higher in August than a year ago, although the pace remains well below the 700,000 consistent with a healthy market.
orders are up
Companies placed slightly more orders in August for U.S. long-lasting manufactured goods, stepping up demand for cars, trucks and machinery. Even with the gain, business spending on factory goods may not be strong enough to accelerate economic growth in the July-September quarter.
Orders for durable goods, items expected to last at least three years, increased 0.1 percent in August, the Commerce Department said Wednesday. That comes after orders plummeted 8.1 percent in July, which was largely because of a steep drop in volatile commercial aircraft orders.
The August orders were held back by a decline in demand for defense aircraft and other military goods. That could be related to steep government spending cuts that took effect in March. Excluding defense spending, orders rose 0.5 percent.
Auto factories reported a 2.4 percent increase in orders, the biggest in six months.
$10 wage bill
signed in Calif.
Calling it a “matter of justice,” Gov. Jerry Brown put his signature on a bill that will hike California’s minimum wage to $10 an hour within three years, making it one of the highest rates in the nation.
The legislation signed Wednesday at a ceremony in downtown Los Angeles will gradually raise the current minimum of $8 an hour to $9 on July 1, 2014, then to $10 on Jan. 1, 2016.
The increase is the first to the state’s minimum wage in six years and comes amid a national debate over whether it’s fair to pay fast-food workers, retail clerks and others wages so low that they often have to work second or third jobs.
Brown called the bill an overdue piece of legislation that will help working-class families and close the gap between “workers at the bottom and those who occupy the commanding heights of the economy.”
The state Senate approved AB10 on a 26-11 vote Sept. 12, and the Assembly followed hours later on a 51-25 vote. Both chambers voted largely along party lines.