(The Center Square) – The U.S. economy continues to send mixed signals as we navigate through May 2025. Last week’s Consumer Price Index (CPI) for April showed inflation ticking up slightly after March’s decline. Headline CPI rose 0.2% in April, accelerating from the -0.05% decrease in March, while core CPI also increased by 0.2%, up from March’s modest 0.06% rise. On a year-over-year basis, headline inflation edged down to 2.3% from 2.4%, but core inflation remained stubborn at 2.8% for the second consecutive month.

The housing component of inflation deserves particular attention. The shelter index rose 0.3% in April, accounting for more than half of the all-items index monthly increase. Rent disinflation appears to be stalling, with the rent of primary residence index growing 0.3% month-over-month and holding steady at 4% year-over-year.

This tenacity in housing inflation reflects fundamental dynamics in the rental market. Renters are staying in place longer, allowing landlords to raise renewal rents more aggressively to catch up with open-market rates. Meanwhile, Zillow has revised its 2025 rent forecast upward, with single-family rents now expected to rise by 3.2% and multifamily rents by 2.1%. The share of rental units offering concessions is declining as vacancy rates stabilize.

Housing Market Data: This Week’s Focal Point

This week’s economic calendar spotlights housing market health with critical releases on both existing and new home sales. These reports will provide crucial insights into whether residential real estate – often a leading indicator of broader economic trends – can withstand the uncertain policy climate and affordability challenges.

Builder activity shows concerning trends

Recent data on housing construction has raised some red flags. Single-family home building decelerated notably in April, with starts dropping to 927,000 (seasonally adjusted annual rate) – a 2.1% decline from March and a worrying 12.0% below April 2024 levels.

Several factors appear to be contributing to this pullback:

• Economic uncertainty: Trade tensions and stock market volatility in March and April created widespread concern, making builders more cautious about breaking ground on new projects.
• Slowing demand: Zillow’s April Market Report revealed that newly pending existing home sales fell 2.5% below last year’s level, suggesting buyers were hesitating.
• Rising inventory: With more homes on the market and slower sales, builders are naturally reassessing their production plans.

Existing home sales: A backward-looking but important indicator

Thursday’s existing home sales report will reflect transactions that went under contract in March, before the full impact of April’s peak uncertainty. Analysts will be watching closely to see if the March figures showed any early signs of the slowdown even before the April stock market plunge.

New Home Sales: A fresher look at market conditions

Friday’s new home sales report will provide a more current snapshot of the market, potentially capturing some of the April hesitation among buyers. New home sales are expected to fall slightly from the previous month.

Market implications and outlook

The housing market’s health carries significant implications for the broader economy and monetary policy. If housing data confirms a meaningful slowdown, it could:

• Reinforce expectations of slowing economic growth: A struggling housing market would eventually feed through to declining new construction, lower employment gains and the potential for an increase in the unemployment rate. Industries tied to housing – from construction materials to home furnishings – could see ripple effects.
• Increase pressure for rate cuts: Signs of housing and labor markets weakness might add urgency to the Fed’s consideration of interest rate reductions.

However, there are reasons to believe any housing slowdown may be temporary. Mortgage rates remain below year-ago levels, contributing to improved affordability. Additionally, the stock market has recovered its April losses, muting any negative wealth effect on consumers’ future spending plans. These factors suggest that the peak home shopping season may simply be delayed rather than dead on arrival.

(The Center Square) – Energy policies included in the U.S. House budget reconciliation package represent a “significant shift in U.S. energy policy,” those in the Texas energy sector argue.

This is after the industry has expressed trepidation over Trump energy and tariff policies that created uncertainty in the market by driving up costs, reducing domestic output and dissuading domestic producers from investing in exploration and expanded production, The Center Square reported.

While the Texas oil and natural gas industry reported job gains in January and February, it reported losses in March for the first time in months as rig counts dropped, The Center Square reported. The industry slightly rebounded in April, according to the latest employment data, The Center Square reported.

Uncertainty in the industry remains due to federal energy policies and “numerous economic and geopolitical factors” that continue to impact domestic production and related investment decisions, the Texas Independent Producers and Royalty Owners Association (TIPRO) said. This includes Trump administration tariffs on steel and aluminum and encouraging OPEC+ countries to increase production, driving down domestic production and profits, The Center Square reported.

However, a positive development is a commitment to reversing Biden administration-era policies, TIPRO notes. This includes Congress prioritizing pro-energy policies in its budget reconciliation bill, referred to by President Donald Trump as one “big, beautiful bill.” The policies include expanding federal fossil fuel leasing, reducing royalty rates, streamlining the permitting process, repealing so-called clean energy incentives, refilling the Strategic Petroleum Reserve and delaying the Methane Emissions Reduction Program (MERP).

The proposals were included in the energy sections of the House Ways and Means Committee and House Natural Resources Committee packages, including prioritizing expanding fossil fuel production, TIPRO notes. The sections were included in the package before the House Budget Committee, which failed to advance it on Friday.

TIPRO and others have called for prioritizing domestic energy production, expanding critical infrastructure, including LNG ports and pipelines, protecting key tax provisions essential to the industry, among other priorities.

Included in the House package is a requirement for at least 30 oil and natural gas lease sales to be made on federal land and in the Gulf of America over the next 15 years. In Alaska, it requires six lease sales for Cook Inlet and authorizes leasing to begin in the National Petroleum Reserve and Arctic National Wildlife Refuge. It also reinstates quarterly onshore oil and gas lease sales, generating an estimated $12 billion in revenue, TIPRO notes.

House energy proposals also reduce royalty rates to 12.5% for onshore and offshore drilling, down from 16.67% and 18.75%, respectively, and put processes in place to increase permitting approvals for energy projects.

House Republicans also repealed provisions of the Inflation Reduction Act, including clean energy incentives that provided tax credits for electric vehicles and renewable energy projects. They also curtailed the hydrogen production credit and expired “technology neutral” clean energy credits by 2031, TIPRO notes.

The House proposal also allocated $1.5 billion to replenish the SPR and delayed MERP by 10 years.

“With the exponential growth in energy demand forecasted in the coming years, oil and natural gas will continue to play a dominant role, but we must have the right strategy in place to provide regulatory and economic certainty to our members for the benefit of our country and allies,” TIPRO President Ed Longanecker said.

With Texas continuing to lead the U.S. in oil and natural gas production, emissions reductions and job growth, “sound policies that support fair business practices and laws that keep our state competitive are necessary if Texas is going to continue to benefit from oil and natural gas activity,” Texas Oil & Gas Association President Todd Staples said.

(The Center Square) – A Goldwater Institute report shows that a number of public Louisiana universities require the completion of diversity, equity, and inclusion-related courses to graduate from some degree programs.

“At least three public institutions – University of Louisiana at Lafayette, University of Louisiana at Monroe, and McNeese State University – require students in certain degree programs such as education to take DEI courses simply to graduate,” the Goldwater Institute report said.

The Goldwater Institute is a “free-market public policy research and litigation organization,” according to its website.

Goldwater Institute’s senior Constitutionalism fellow Tim Minella told The Center Square that “requiring these activist courses wastes time and tuition dollars while failing to develop the knowledge and skills that will serve students in their careers.”

“Even in red states, students in public universities are being forced to sit through courses intended to indoctrinate them in the radical tenets of DEI just to graduate,” Minella said.

“As this new report shows, the University of Louisiana at Lafayette requires students in the master’s of education program to take ‘Diversity for the Progressive Educator’  a course that focuses on ‘critical elements of race/ethnicity’ and seeks to enhance ‘the commitment to take action against [systems of inequality],’” Minella told the Center Square.

Likewise, as stated in the report, “at the University of Louisiana at Monroe (ULM), Elementary Education majors are required to take ‘CURR 2001: Educational Foundations for Diverse Learning Environments,’ which ‘provides multicultural insight to support the educational needs of diverse students in their learning environment.’”

Additionally, “at McNeese State University, students seeking a B.A. in English Education Grades 6-12 must take ‘EDUC 204: Orientation to Multiculturalism and Diversity in Education,’” the report states.

When asked by The Center Square why it is inappropriate for public universities to require DEI-related courses to graduate, Minella said that “DEI course requirements force students to sit through lectures in the progressive agenda instead of gaining a real education that enhances knowledge and develops valuable skills.”

“As this report shows, Louisiana’s schools of education are focusing on training political activists instead of preparing students to be effective classroom teachers,” Minella said.

“Furthermore, DEI course requirements artificially inflate the enrollment of DEI courses,” Minella said. “Many students would decline to take these activist courses and opt to enroll in more valuable academic activities, if not for DEI course mandates.”

“This report demonstrates the pressing need for states to eliminate mandatory DEI courses in public universities by adopting Goldwater’s Freedom from Indoctrination Act reform,” Minella told The Center Square.

The Freedom from Indoctrination Act is a model legislation made up of three sections: “Prohibit Mandatory DEI / [Critical Race Theory] Based Course Requirements,” “Ensure Basic Instruction in American Institutions,” and “Ensure Freshman Orientation Programs Promote the Free Exchange of Ideas rather than Political Indoctrination.”

The Center Square reached out to the University of Louisiana at Lafayette, the University of Louisiana at Monroe, McNeese State University, and the University of Louisiana System for comment.

McNeese State said it would respond by next week. The other universities did not respond.

The Trump administration has been working to root out DEI with various executive orders by the president as well as the Education Department’s Dear Colleague letter that stated race-based decisions in education are unlawful, as The Center Square previously reported.

Tim Minella wrote in an article for the Goldwater Institute that “although President Donald Trump has dismantled federal support for DEI, his executive orders rightly exempted ‘academic instruction’ in higher education from these new federal protections, leaving oversight of academic standards to the states.”

“Louisiana must act to eliminate DEI indoctrination in the classroom,” Minella wrote.