American consumers lost confidence for the third straight month, with the Reuters/University of Michigan preliminary Consumer Sentiment Index, released April 13, hitting an eight-month low of 85.3 in April from March’s 88.4. Consumers responding to the survey said they expect inflation to rise.

The March Producer Price Index (PPI) — which measures prices before they reach consumers — rose 1 percent after February’s 1.3 percent increase, the Labor Department reported April 13. March’s jump was slightly ahead of a 0.7 percent increase predicted by experts, who attributed March’s jump to rising energy and food costs. Meanwhile the core PPI, which excludes food and energy prices, was unchanged.

Contrary to economists’ predictions of a widening U.S. trade deficit, the gap actually narrowed in February to $58.4 billion from January’s $58.9 billion, the Commerce Department reported April 13. Economists had predicted the deficit would widen in February to $60 billion. Imports of goods and services fell 1.7 percent to $182.4 billion and exports declined by 2.2 percent to $124 billion.

Imports from China fell to their lowest level since May 2006, with the trade gap dropping to $18.4 billion in February from January’s $21.3 billion.

The unemployment rate in March fell to 4.4%, matching a five-year low, the Labor Department reported April 6. Employers boosted their payrolls by 180,000 workers in March, the most since December. The figures suggest that companies are not feeling a need to restrict hiring in an economy that has otherwise shown signs of sluggishness. New orders placed with U.S. factories rose by 1% in February, the Commerce Department said April 4. Economists were expecting a bigger 1.9% increase. Despite the lackluster showing, February’s performance was a sharp improvement from the 5.7% plunge in new orders reported in January. Meanwhile, the Institute for Supply Management (ISM) said its manufacturing index slipped to 50.9 in March, smaller than February’s reading of 52.3 and Wall Street’s expectation of 51. Any reading larger than 50 indicates growth for the sector. Similarly, growth in the nation’s service sector slowed, as the ISM’s service sector index fell to 52.4 in March from February’s 54.3 reading. The index also fell short of the 54.7 reading analysts had predicted. For the week ending April 5, interest rates on 30-year mortgages nudged up, but still hovered close to their low for the year.

Consumer spending rose 0.6% in February, the best showing since a 0.7% jump in December, the Commerce Department reported March 30. The gain was double what analysts had expected, which should help alleviate recession fears fueled by a slump in housing and the domestic auto industry.

Personal income also was up 0.6% in February, which followed a 1% surge in January. Even with the rise in income, the savings rate remained at a negative 1.2% in February, the 23rd consecutive month the savings rate has been in negative territory.

Sales of new homes dropped 3.9% in February to a seasonally adjusted annual rate of 848,000 units, the slowest pace in nearly seven years, the Commerce Department said March 26. Meanwhile, the median price of a new home fell to $250,000 in February, down 0.3% from a year ago.

Orders to factories for durable goods — big-ticket items expected to last three or more years — increased 2.5% in February. Even with the rebound from January’s 9.3% drop, the gain was smaller than the 3.5% gain expected by Wall Street.

On March 30, oil prices reached $66.55 a barrel on the New York Mercantile Exchange, the highest level in six months. Concern over rising gasoline prices helped undermine consumer confidence, as the Conference Board’s Consumer Confidence Index fell from 111.2 in February to 107.2 in March. The March index was the lowest since November when the reading was 105.3.

Sales of existing homes unexpectedly rose by 3.9% in February, the largest monthly gain in three years, the National Association of Realtors reported March 23. The price of a median home sold last month dropped to $212,800, down by 1.3% from the same month in 2006, marking a record seven straight months that the median home price has fallen. Construction of new homes and apartments rose 9% in February to a seasonally adjusted annual rate of 1.53 million units, the Commerce Department reported March 20. Construction had fallen by 14.3% in January. Even with the better-than-expected rebound, construction activity remained 28.5% below last year’s level. Builders’ applications for new permits, considered a reliable gauge of future activity, continued falling in February, dropping by 2.5% to an annual rate of 1.53 million units. That marked the 12th decline in the past 13 months in building permits. Federal Reserve policymakers announced on March 21 that they would leave the central bank’s key federal funds rate — the rate that banks charge one another for overnight loans — at 5.25%, where it has remained since June 2006. The Conference Board’s Composite Index of Leading Economic Indicators slipped 0.5% in February. The drop, while expected, was the steepest since February 2006. The index is important because it often foreshadows the performance of the economy over the next six to nine months.

Driven by big jumps in energy and food costs, the Consumer Price Index rose 0.4% in February, the Labor Department said March 16. The increase was larger than the 0.3% gain analysts had forecast. Core consumer inflation, which excludes volatile food and energy prices, was milder, rising just 0.2%, exactly what economists had been expecting.

The Producer Price Index — which measures prices before they reach consumers — surged 1.3% in February, more than double the 0.5% rise economists anticipated. Even excluding sharp increases in food and energy prices, core wholesale inflation rose 0.4%, the biggest increase since November.

The current account deficit — which is the broadest measure of the trade deficit because it covers not only trade in goods and services but also investment flows between countries - decreased to $195.8 billion during the fourth quarter of 2006 from a revised $229.4 billion in the third quarter, the Commerce Department said March 14. For all of 2006, the deficit totaled $856.7 billion, an 8.2% increase over 2005’s gap of $791.5 billion.

Retail sales nudged up 0.1% in February, as adverse winter weather kept already cautious shoppers away from the malls, the Commerce Department said March 13. The latest retail sales figures were weaker than the 0.3% analysts predicted. A bright spot was auto sales, which climbed 0.9%.

Mortgage rates for the week ended March 15 showed no change from the previous week.