Economic Update
Obama unveils reform plan. President Obama announced a plan to revamp financial industry regulation and prevent firms “too big to fail” from collapsing. The plan would make the Federal Reserve the chief watchdog over big banks, insurers and other major financial firms, police hedge funds and private equity funds, replace the Office of Thrift Supervision with a National Bank Supervisor, and create a new agency to regulate credit cards and mortgages.1
Housing starts leap 17%. They increased by 17.2% in May – and permits for single-family homes were up 7.9% last month, making it the best month in that category since November.2
Energy prices push down CPI. Across the 12 months ending in May, the Consumer Price Index fell 1.3%, the biggest year-over-year drop since 1950 and mostly due to declining energy prices. CPI did rise 0.1% in May; core CPI was up 1.8% last month.3 PPI rose 0.2% in May, as energy prices climbed 2.9%.4
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