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Report from
North America
Single-family home building at an 11-month low
While new home construction rebounded in June single-
family homebuilding dropped to an 11-month low in as
high mortgage rates and economic uncertainty hampered
home purchases, suggesting residential investment
contracted again in the second quarter.
Private home building came in at a seasonally adjusted
annual rate of 1.32 million new houses in June, the
number was up about 4.6% from May but still half a
percent lower than June of last year.
The US Department of Commerce also reported that
permits for future construction of single-family homes
tumbled to more than a two-year low last month, aligning
with downbeat sentiment among homebuilders.
The slump in demand has increased the supply of homes
on the market, discouraging builders from breaking
ground on new housing projects. New housing inventory is
at levels last seen in late 2007.
Single-family housing starts, which account for the bulk of
homebuilding, dropped 4.6% to a seasonally adjusted
annual rate of 883,000 units last month, the lowest level
since July 2024. Homebuilding in that category fell in all
four regions, with steep declines in the West and the
densely populated South.
"Everywhere builders look there are reasons to delay or
scrap projects," said Christopher Rupkey, Chief Economist
at FWDBONDS. "The nation's housing market outlook
has never looked this troublesome. This could actually end
quite badly for the economy."
In Canada, the annual pace of housing starts edged up
0.4% in June compared to May, according to the Canada
Mortgage and Housing Corporation. The national housing
agency says the seasonally adjusted annual rate of housing
starts amounted to 283,734 units in June, up from 282,705
in May.
US home sales posted slowest May in 16 years
The home sales slump in the US continues as May 2025
became the slowest May for existing home sales since
2009. Existing home sales in May fell 0.7% compared to
the same month last year. Measured monthly, sales were
up slightly, 0.8%, from the month before but that marks an
increase from the slowest April for existing home sales in
16 years.
National Association of Realtors Chief Economist
Lawrence Yun called the sales figures "very stable, but at
the sluggish sales activity level."
The key challenge is affordability, with median home
prices up 52% compared to May 2019, while wages
gained 30% over that period, according to Yun.
Meanwhile, sales activity is running at 75% of what it was
pre-COVID, Yun added.
One thing that has changed in recent months is inventory:
The number of homes for sale is up more than 20% over a
year ago. Inventory has been rising in every region of the
country, with the biggest upticks in the West and South,
according to Realtor.com.
That's meant a shift to a market that favors buyers more in
some areas. Using inventory data to determine the number
of home sellers, and a model to estimate the number of
buyers, Redfin recently estimated there are 34% more
sellers than buyers in the US now. Regionally, sales
increased in the Northeast, Midwest and South but
retreated in the West. Year on year, sales progressed in the
Northeast and Midwest but contracted in the South and
West.
See: https://www.nar.realtor/research-and-statistics/housing-
statistics/existing-home-sales
US job growth continues, but weaknesses are showing
The US economy added seasonally adjusted 147,000 jobs
in June despite lower predictions the Bureau of Labor
Statistics (BLS) reported.
The BLS monthly jobs report showed a slight uptick over
May's 139,000 increase. The estimate for the July report
was 110,000 non-farm jobs added.
Job gains were made in traditionally steady sectors like
local and state government, education, leisure and
hospitality and health care.
But some economists are worried that job growth was not
widespread. Sectors that saw the biggest monthly gains
were mostly ones that are less affected by tariffs. The
manufacturing sector saw a decline for the second-straight
month, losing 7,000 jobs.
Unemployment decreased in June but that was because
329,000 people dropped out of the labour force, with many
saying they were too discouraged by how hard it was to
find a job. The so-called participation rate fell in June to a
2½-year low of 62.3%, down from a post-pandemic peak
of 62.8% two years ago.
This rate illustrates what share of people of working age
either have a job or are looking for one. The current
crackdown on immigration is expected to add to the
squeeze on the supply of labor.
“Although the overall number of jobs was very strong, the
weakness was broad-based across the private sector,” said
chief economist Eugenio Aleman of Raymond James.
“The labor market continued to weaken in June.”
See: https://www.bls.gov/news.release/empsit.nr0.htm
US consumer sentiment improves in July
Consumer sentiment improved in July and while inflation
expectations continued to decline, US households still saw
substantial risk of price pressures increasing in the future.
The University of Michigan's Surveys of Consumers on
Friday said its Consumer Sentiment Index rose to 61.8 this
month from a final reading of 60.7 in June. Economists
polled by Reuters forecasted the index would increase to
61.5.
"Consumers are unlikely to regain their confidence in the
economy unless they feel assured that inflation is unlikely
to worsen, for example if trade policy stabilises for the
foreseeable future," Joanne Hsu, the Director of the
Surveys of Consumers, said. "At this time, the interviews
reveal little evidence that other policy developments,
including the recent passage of the tax and spending bill,
moved the needle much on consumer sentiment."
Consumers' 12-month inflation expectations dropped to
4.4% from 5.0% in June. Long-run inflation expectations
fell to 3.6% from 4.0% last month.
See: https://www.sca.isr.umich.edu/
Manufacturing executives pessimistic as sector
activity contracts for fourth consecutive month
Economic activity in the manufacturing sector contracted
in June for the fourth consecutive month, following a two-
month expansion preceded by 26 straight months of
contraction, according to the latest Manufacturing ISM
Report On Business.
ISM’s “Manufacturing PMI” registered 49% in June, a
0.5-percentage point increase compared to the 48.5%
recorded in May. A PMI percent below 50% indicates
contraction in the sector. Of the 18 industry categories
surveyed by ISM, the Furniture and Related Products
sector was among the nine industries reporting growth in
June, while the Wood Products sector was among the six
industries reporting contraction from the previous month.
“In June, US manufacturing activity slowed its rate of
contraction, with improvements in inventories and
production the biggest factors in the 0.5 percentage point
gain in the Manufacturing PMI,” ISM Survey Chair Susan
Spence said.
Despite the gain and the PMI registering only barely into
the contraction range, executives were very pessimistic in
comments to the ISM. American manufacturers say they
don’t expect much relief soon, as ongoing trade wars have
raised costs, curbed demand and made it hard to plan.
“Business has notably slowed in last four to six weeks.
Customers do not want to make commitments in the wake
of massive tariff uncertainty,” wrote one executive at a
company that makes metal parts.
Companies “need some clarity on tariffs,” said senior
economist Jennifer Lee of BMO Capital Markets.
“Certainty on what the tariff rates will be and what they
will cover. The uncertainty is putting the brakes on
business planning.”
See: https://www.ismworld.org/supply-management-news-
and-reports/reports/ism-report-on-business/
and
https://www.msn.com/en-us/money/markets/u-s-
manufacturing-slump-shows-little-sign-of-ending-amid-
ongoing-trade-wars-ism-says/ar-
AA1HLR96?ocid=BingNewsVerp
Cabinet sales rise 6% in May
Cabinet manufacturers reported a 6.0% monthly gain in
sales in May according to the Kitchen Cabinet
Manufacturers Association’s April Trend of Business
report. Despite the gain, at US$207.5 million, sales were
7.6% lower than that of May 2024. Custom Sales rose
8.8% from the previous month while Semi-Custom Sales
gained 5.2%. Stock Sales rose by 4.3%. Through the first
four months of the year, sales are down 6.3% from this
point last year, with the number of units sold down 15.9%.
See: https://kcma.org/sites/default/files/2025-
06/trend%20of%20business%20-%20newsletter.jpg
USITC to continue investigations on hardwood and
decorative plywood from China, Indonesia, and
Vietnam
In what has been described as a victory for US producers
of hardwood and decorative plywood (HWDP), the US
International Trade Commission (ITC) on July 3 found
that there is a reasonable indication that imports from
China, Indonesia, and Vietnam are materially injuring the
US HWDP industry,
Chair Amy A. Karpel and Commissioners David S.
Johanson and Jason E. Kearns voted in the affirmative.
The vote came in response to petitions filed by the
Coalition for Fair Trade in Hardwood Plywood, which
consists of five leading US HWDP producers: Columbia
Forest Products, Commonwealth Plywood, Manthei Wood
Products, States Industries, and Timber Products.
As a result of the Commission’s affirmative
determinations, the US Department of Commerce will
continue its investigations of imports of hardwood and
decorative plywood from China, Indonesia, and Vietnam,
with its preliminary antidumping duty determinations due
October 29 and its preliminary countervailing duty
determinations due on August 15.
The Commission’s public report, Hardwood and
Decorative Plywood from China, Indonesia and Vietnam
will contain the views of the Commission and information
developed during the investigations. The report will be
available by 11 August.
See:
https://www.woodworkingnetwork.com/news/woodworking-
industry-news/trade-commission-makes-preliminary-
determination-hardwood-and
US Begins 301 Investigation on Brazil
The Office of the US Trade Representative (USTR)
has initiated a Section 301 investigation into a number of
Brazil's trade practices, including allegations of
environmental enforcement failures focusing on illegal
deforestation and illegal logging.
Among other non-timber related allegations, USTR alleges
Brazil's inadequate enforcement of environmental laws has
enabled illegal deforestation for agricultural production,
particularly soy plantations and cattle ranches. This
reduces costs and expands land availability for Brazilian
producers who compete directly with US agricultural
exports. USTR also alleges that more than one-third of
Amazonian timber is estimated to be of illegal origin,
harvested from protected lands or without proper permits.
At the end of the investigation, if USTR determines that
unfair trade practices are occurring, USTR must
implement retaliatory measures within 30 days, including
tariffs, fees or import restrictions (no maximum rate limit)
or withdrawal or suspension of trade agreements
See:
https://ustr.gov/sites/default/files/files/Press/Releases/2025/Bzl%
20frn%20for%20press%20ofc%20final.pdf
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