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The State of the 2004 US Economy with Weekly Updates (pg. 8)
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| occrider |
Short list ... I only got data since this past Wednesday:
Week Ending September 17
RELEASE: MBA Mortgage Applications Survey [United States]: 658.2
FIRST TAKE: The MBA index fell 9.2% to 658.2 during the week ending October 8, 2004. This decline is the sharpest since the spring and occurred in both the refi and purchase indexes. The index fell despite another decline in mortgage interest rates. The volatile nature of this statistic, however, renders it far from certain that last week’s drop is the beginning of a broader-based slowing in mortgage demand.
RELEASE: ABC News/Money Magazine Consumer Comfort Index [United States]: -11
FIRST TAKE: The ABC News/Money Magazine consumer comfort index moved up one point to -11 in the latest week, ending a more than one-month streak of steady or declining readings.
RELEASE: Job Openings and Labor Turnover Survey [United States]: 18.7%
FIRST TAKE: Reflecting the slightly improved employment situation in August relative to July, the rate of job openings remained unchanged in August at 2.4%, while the hire rate rose slightly to 3.3% of employment, from 3.2% in July although it remained lower than during the spring. Separations were unchanged at 3.1% of employment for the fifth consecutive month.
RELEASE: PPI [United States]: 0.1%
FIRST TAKE: Producer prices for finished goods increased by 0.1% in September. This increase would have been larger if not for a 0.9% decline in the finished energy goods index. Rapid inflation continued among core intermediate goods, which increased for the 14th consecutive month.
RELEASE: Retail Sales (MARTS) [United States]: 1.5%
FIRST TAKE: Total retail sales soared 1.5% in September, well above expectations. Auto sales led the way, but excluding autos sales rose 0.6%, led by strong growth at building supply and general merchandise stores. Core sales rose 0.7%. August’s decline was revised slightly smaller.
RELEASE: NY Empire State Manufacturing Survey [United States]: 17.4
FIRST TAKE: Manufacturing activity in New York state during October decelerated more sharply than consensus estimates, as the general business conditions index slipped to 17.4.
RELEASE: Industrial Production [United States]: 0.1%
FIRST TAKE: Industrial production rose a tepid 0.1% in September, even as the August figure was revised downward to negative 0.1%. The effect of recent hurricanes seems to have played a significant role in curtailing production in recent weeks, however.
RELEASE: University of Michigan Consumer Sentiment Survey [United States]: 87.5
FIRST TAKE: The University of Michigan Consumer Sentiment Index preliminary value for October dropped sharply to 87.5, from 94.2 in September. Consumers’ assessment of the outlook tumbled while views of current conditions fell modestly. Gasoline prices approaching $2.00 on average were a major factor in the decline.
RELEASE: Business Inventories (MTIS) [United States]: 0.7%
FIRST TAKE: U.S. business inventories rose 0.7% in August, as sales also rose 0.7% for the month. Already tight inventories tightened further in midsummer. While the August gain is suggestive of still strong inventory building, the summer's pace does suggest that inventory accumulation won't be the large contributor to growth of previous quarters.
RELEASE: ECRI Weekly Leading Index [United States]: 131.0
FIRST TAKE: The smoothed, annualized growth rate of the ECRI Weekly Leading Index (WLI) dropped to -1.0% for week ending October 8. This comes as the index’s level slipped from 131.8 to 131.0. |
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| occrider |
Week Ending October 24
RELEASE: ECRI Weekly Leading Index [United States]: 131.6
FIRST TAKE: The smoothed, annualized growth rate of the ECRI Weekly Leading Index (WLI) held steady at -1.0% for the week ending October 15. This comes as the index’s level rose from 131.0 to 131.6.
RELEASE: NAHB Housing Market Index [United States]: 72
FIRST TAKE: Builder optimism is picking up again, as low mortgage rates continue to bolster demand for new homes. The NAHB index moved up in October to 72, with all three components of the index advancing. Builder expectations, in particular, are rebounding sharply.
RELEASE: Economy.com Survey of Business Confidence: 26.7%
FIRST TAKE: Business confidence slipped a bit further in mid-October. Confidence had seemingly stabilized in September after falling throughout the summer. The renewed softening in sentiment is broad-based across the globe and most industries. The most pronounced weakening in responses is to the broader questions regarding current conditions and conditions expected six months hence. Despite the weaker confidence, it remains consistent with a global economy that is expanding just over its potential of approximately 3%.
RELEASE: Chain Store Sales Snapshot [United States]: -0.2%
FIRST TAKE: Chain store sales returned to their downbeat ways in the week ending October 16, falling 0.2%, according to the ICSC-UBS chain store sales index after two weeks of gains. Sales were reportedly strongest in the South, possibly due to replacement demand following the hurricanes. Year-over-year growth slipped to 3.4%.
RELEASE: Consumer Price Index [United States]: 0.2%
FIRST TAKE: Consumer prices rose 0.2% in September, weighed down by a 0.4% decline in energy prices. Core consumer prices rose 0.3%, however, due to larger price gains across most categories of consumer goods and services. With the September increase, core inflation is now 2.0%, the first time it has reached that level since late 2002.
RELEASE: New Residential Construction (C20) [United States]: 1.90 million
FIRST TAKE: Residential construction activity declined in September, continuing a broad trend of slowing that began at the end of last year. While Economy.com’s expectations were on the low side, starts are falling even more sharply, declining 6% below August’s reading to 1.898 million annualized units. This drop is the largest one- month decline since January, and puts starts below last September’s reading. Census revised upward August's numbers.
RELEASE: MBA Mortgage Applications Survey [United States]: 709.9
FIRST TAKE: The MBA index increased by 7.9% during the week ending October 15, 2004. The increase is almost strong enough to offset the previous week’s sharp decline, pushing the index up to 709.9. Falling mortgage rates are bolstering applications for both refis and purchases. Refi demand’s slow rise leaves it still looking weak compared to the heights reached last year. Purchase applications are back in very strong territory.
RELEASE: ABC News/Money Magazine Consumer Comfort Index [United States]: -11
FIRST TAKE: The ABC News/Money Magazine consumer comfort index held steady at -11 in the latest week. The number of Americans who think that the economy is getting worse is at its highest level in seven months.
RELEASE: Oil and Gas Inventories [United States]: 279.4 MB
FIRST TAKE: Inventory data for the week ending October 15 should have a bullish impact on petroleum markets. While the Energy Information Administration reported a build in commercial crude oil stocks, the American Petroleum Institute reported a draw. Moreover, the API and the EIA both reported substantial draws in distillate fuel and motor gasoline stocks.
RELEASE: Jobless Claims [United States]: 329,000
FIRST TAKE: The number of people applying for first-time benefits has fallen back to the levels that prevailed earlier in the summer, prior to the hurricanes. Last week, 329,000 displaced workers filed for claims. The total for the prior week was revised up by 2,000, to 354,000.
RELEASE: Chicago Fed National Activity Index [United States]: -0.01
FIRST TAKE: The Chicago Fed National Activities Index tallied at -0.01, slightly below August's revised +0.03 value.
RELEASE: The Conference Board Leading Indicators [United States]: -0.1%
FIRST TAKE: As expected, the leading index fell for the fourth month in a row, declining 0.1% in September. A narrower yield spread and weaker vendor performance were among the factors that pulled the index lower. The coincident index also fell, dropping 0.2%, while the lagging index was unchanged for the month.
RELEASE: Monthly Mass Layoffs [United States]: 708
FIRST TAKE: Employers initiated 708 mass layoff events involving 68,972 workers in September. The manufacturing industry continues to account for the largest portion of mass layoffs, while the West region accounted for the most initial claims for the second consecutive month.
RELEASE: Weekly Natural Gas Storage Report [United States]: 3,223 Bcf
FIRST TAKE: Underground storage of natural gas increased by 64 billion cubic feet during the week ending October 15, just slightly above expectations. Thus, today’s storage data will have a negligible effect on natural gas markets.
RELEASE: Philadelphia Fed Survey [United States]: 28.5
FIRST TAKE: The Philly Fed Index came in well above expectations, rebounding 15.1 points to close at 28.5 for the month of October. Overall, approximately 40% of responding firms indicated increases in overall activity, new orders and shipments. |
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| occrider |
Week Ending October 31
RELEASE: UBS Index of Investor Optimism [United States]: 62.0
FIRST TAKE: Investor confidence declined for the fourth consecutive month. The UBS index of investor optimism fell 12 points to 62, reaching a 12-month low.
RELEASE: Existing Home Sales [United States]: 6.75 Million
FIRST TAKE: Sales of existing homes surprised on the upside in September, rising by 3% from the previous month to 6.75 million annualized units. Falling mortgage rates in July and August are likely behind the renewed strength in sales. This increase is the first in three months.
RELEASE: Economy.com Survey of Business Confidence: 25.8%
FIRST TAKE: Business confidence continues to edge lower. Confidence has weakened appreciably since its early summer peak. Sentiment is down across the globe, with the most pronounced decline occurring in Asia. Confidence is also off across nearly all industries. The most pronounced weakening in responses is to the broader questions regarding current conditions and conditions expected six months hence. While confidence has slipped, it remains consistent with a global economy that is expanding near its potential of 3%.
RELEASE: Chain Store Sales Snapshot [United States]: -0.6%
FIRST TAKE: Chain store sales continued their downbeat ways in the week ending October 23, falling 0.6% according to the ICSC-UBS chain store sales index. Sales were reportedly strongest in the South, possibly due to replacement demand following the hurricanes. Year-over-year growth rose to 3.7%.
RELEASE: The Conference Board Consumer Confidence [United States]: 92.8
FIRST TAKE: The Conference Board index of consumer confidence fell nearly four points to 92.8 in October from 96.7 in August. The decline was led by the expectations component of the index, which was down nearly six points. Consumers' assessments of current labor markets improved modestly, although they become more concerned about the labor market outlook.
RELEASE: MBA Mortgage Applications Survey [United States]: 703.9
FIRST TAKE: The MBA index decreased by 0.8% during the week ending October 22, 2004, despite another decline in fixed mortgage rates. The decline in purchase demand was deep enough to offset the solid increase in the demand for refi mortgages.
RELEASE: Durable Goods (Advance) [United States]: 0.2%
FIRST TAKE: New orders for durable goods rose a weaker than expected 0.2% in September, following a 0.6% decline in August. A 3.6% decline in transportation orders was the chief cause. Excluding transportation, new orders rose 1.7% for the month. Also, nondefense capital goods orders rose 0.6% for the month.
RELEASE: ABC News/Money Magazine Consumer Comfort Index [United States]: -11
FIRST TAKE: The ABC News/Money Magazine consumer comfort index held steady at -11 for the second straight week. Another decline in the personal finances component offset a stronger read on the economy.
RELEASE: New Home Sales (C25) [United States]: 1,206,000
FIRST TAKE: Sales of new homes surprised on the upside, with the pace of sales reaching 1.206 million units in September, well ahead of expectations. This gain puts the pace of sales 3.5% above the August pace. However, Census revised downward August's reading. Strong demand fueled by falling mortgage interest rates is boosting sales.
RELEASE: Oil and Gas Inventories [United States]: 283.4 MB
FIRST TAKE: Commercial crude oil stocks showed a sizable increase during the week ending October 22. Motor gasoline stocks also recorded a sizable build, while distillate stocks showed a sizable draw due to strong demand. Overall, today’s inventory should have a bearish effect on crude oil and gasoline, while the rally in heating oil will continue.
RELEASE: Creditforecast.com Quarterly Household Credit Repo [United States]: 16.2%
FIRST TAKE: Households continued to borrow aggressively in the third quarter of 2004. Growth was led by mortgage borrowing which accelerated to over 20% (y/y). Auto and consumer finance borrowing growth slowed while credit card borrowing growth accelerated, though it remains weak. Credit quality was little changed in the quarter. Credit quality improved in the quarter for bankcard loans but deteriorated for auto loans. An improving job market is supporting credit quality while higher short term interest rates and aggressive borrowing are constraints.
RELEASE: Jobless Claims [United States]: 350,000
FIRST TAKE: Jobless claims rose to 350,000 last week, far above consensus estimates, which called for a total of 338,000 new claims. Claims for the week ending October 16 were revised up by 1,000 to 330,000. Continuing claims rose above 2.8 million, to 2.823 million although the prior week's claims were revised down to 2.785 million.
RELEASE: The Conference Board Help Wanted Index [United States]: 36
FIRST TAKE: The Conference Board's help wanted index dipped one point in September to a reading of 36. It has now retreated to its cyclical nadir. In the last three months, help wanted advertising has declined in eight of the nine U.S. regions.
RELEASE: Weekly Natural Gas Storage Report [United States]: 3,249 Bcf
FIRST TAKE: Underground storage of natural gas increased by 26 billion cubic feet during the week ending October 22, short of the expected build of 36 Bcf. However, the bearish momentum contained in today’s data due to the surprise will be limited as overall storage is ample.
RELEASE: Employment Cost Index [United States]: 0.9%
FIRST TAKE: Employment costs accelerated by 0.9% in the third quarter of 2004, in line with our forecast. Benefit cost increases continue to lead the charge, accounting for about 40% of the increase in total costs, but lower than in the first two quarters. Wage cost growth accelerated slightly. Low wage costs suggest persistent weakness in the labor markets, and soaring benefit costs remain a serious concern to employers.
RELEASE: GDP [United States]: 3.7%
FIRST TAKE: Real gross domestic product rose at a 3.7% annualized rate in the third quarter of 2004, according to advance estimates. This is up from 3.3% growth during the second quarter. Key drivers of growth during the quarter were the 4.6% advance in consumer spending, 14.9% jump in capital equipment spending, 1.5% growth in government expenditures and a 3.1% increase in residential investment.
RELEASE: NAPM - NY Report [United States]: 313.7
FIRST TAKE: The New York City economy improved again in October, but at a slower pace than proceeding months. The Business Conditions index (BCI) expanded roughly 1.0% from one month prior and now stands at 313.7.
RELEASE: University of Michigan Consumer Sentiment Survey [United States]: 91.7
FIRST TAKE: The sharp drop in the University of Michigan Consumer Sentiment Index preliminary value for October turned out to be an aberration as nearly tow-thirds of the decline was eliminated in the final release. Nonetheless, the index dropped 2.5 points from September to 91.7. Consumers’ assessment of the outlook fell while views of current conditions increased marginally from September. Both components rose from their preliminary values.
RELEASE: Chicago PMI [United States]: 68.5
FIRST TAKE: The Chicago PMI posted a huge gain in October, rising to 68.5 compared to the consensus, which called for a slide to 59. Today's report should raise expectations for the much-anticipated ISM release on Monday.
RELEASE: ECRI Weekly Leading Index [United States]: 130.6
FIRST TAKE: The smoothed, annualized growth rate of the ECRI Weekly Leading Index (WLI) declined to -1.4% for the week ending October 22. This comes as the index’s level dropped from 131.6 to 130.6.
RELEASE: Agricultural Prices [United States]: -3.5%
FIRST TAKE: The aggregate prices received index for farm commodities fell 3.5% in October, marking the fifth straight month of decline. The composite indices for crops and livestock products fell 5.4% and 0.8%, respectively. Producers received higher commodity prices for vegetables and fruits while corn, soybeans, hogs and broilers all fetched lower prices. |
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| Shakka |
| Damn! Anyone catch the October jobs report?! HUGE! And a big positive revision to September as well. |
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| occrider |
| quote: | Originally posted by Shakka
Damn! Anyone catch the October jobs report?! HUGE! And a big positive revision to September as well. |
It is a good jobs report however, the numbers are somwhat inflated by the hurricanes that hit Florida. At least 71,000 of those jobs are new construction jobs to clean up and rebuild the state. As such, I would be wary of a false positive. Considering the number of jobless claims for the month, I would hold off on the celebration until we get another good month or two. |
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| Shakka |
| quote: | Originally posted by occrider
It is a good jobs report however, the numbers are somwhat inflated by the hurricanes that hit Florida. At least 71,000 of those jobs are new construction jobs to clean up and rebuild the state. As such, I would be wary of a false positive. Considering the number of jobless claims for the month, I would hold off on the celebration until we get another good month or two. |
True. But definitely heading in the right direction. They blew away expectations of 175K by 162K, so even if 71K were hurricane related, you still got a 91K bonus. Not to mention the prior month was revised upward to 139K from 96K. In any event, 1 month does not make a trend, but it's clearly a positive step. I would've been much more wary of the numbers had they come out a week ago, but with the election now behind us, I tend to be a bit more optimistic about them. |
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| rupert |
taken from The Australian Financial Review Nov 10:
Bleak forecast for US economy
Nov 10
Chris Wright
"It was a good one to lose." So says one Australian commentator on the US election, painting a bleak picture of the year ahead that suggests investors would be well advised to keep their funds as far from the country as possible.
Jonathan Pain is chief investment strategist at HFA Asset Management, and has previously been chief investment officer of Rothschild Australia Asset Management and chair of Paribas Asset Management's London-based international asset allocation committee. He's a contrarian - indeed, he's on the road being contrary in various locales around Australia this week, and his views on the US economy are no exception.
His view, to put it bluntly, is that America's economy is in a mess, for several reasons.
One is the extraordinary level of fiscal and monetary accommodation that has been applied to the US economy since September 11, with a $US200 billion surplus turning into a more than $US300 billion deficit in three years, and historically low interest rates, quite apart from the record current account deficit. "If we acknowledge that we have been witness to the mother of all stimulations, we have to ask ourselves what is next - and if we accept that we have to see a reversal in those same stimulatory dynamics, then we must surely agree the global economy will slow."
American consumers have also enjoyed the benefits of withdrawing equity from their homes as house prices have risen - it's difficult to quantify but Mr Pain puts the figure at about $US400 billion in three years. That level of withdrawal, which has been another form of stimulus, is now falling. Also, much of the capital expenditure tax relief that the Bush administration granted to US companies runs out at the end of this year. "Lots of firms are front running that by making purchases this side of the year end."
Then there's oil. Mr Pain sees no good reason for the oil price to drop much in the long term, citing the motorisation of China as an example of the changing demand side of the equation. China had six cars per thousand people in 2002 and 11 by the end of 2003, he says; the US has about 500.
"I'm not suggesting China's going to 500 in the next decade, but if it went to 50, a fraction of car ownership in the Western world, consider the implications for oil. The world is already consuming as much as it possibly can, Saudi Arabia is at its full production tilt.
"For people who say 'this price rise doesn't count, it's driven by speculation' - that's nonsense. Every market in the world moves on speculation. And people say, 'In 1973 in real terms oil prices were much higher.' I don't care! You don't say: I don't mind paying $1.15 a litre because in 1973 it was relatively more expensive, do you?"
And this is all without talking about al-Qaeda or other external shocks. The net result of this pessimistic view is that where many economists expect up to 4 per cent growth in the US next year, Mr Pain expects 1 per cent. Hence his conclusion that last week's election was a good one to lose. "Whoever occupies the Oval Office is faced with a shocking menu of problems."
So what should investors conclude from all this? Not to invest in the US markets, presumably - and, since the currency is the one form of economic stimulus still available to that country, any unhedged gains there could be cancelled out by a falling US dollar.
But Mr Pain isn't bearish on everywhere, and in particular he isn't bearish on Asia. "We are witness to the baton of economic leadership being passed from west to east."
He also thinks Australia is in a sweet spot, thanks in part to its proximity to Asia. "China has a voracious appetite for everything that's under the soil of Australia," he said. He thinks industries like tourism and real estate will also benefit enormously from Asian nations growing in affluence.
But not the US. "They've finally run out of options, and it makes me think that the most indebted nation on earth has come to the end of its path."
What I have been saying on this forum, to my friends and at University, but no one believes me. Low interest rates and excess liquidity have only postponed an inevitable crash |
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| occrider |
Week Ending November 7
RELEASE: Personal Income [United States]: 0.2%
FIRST TAKE: Personal income rose 0.2% while disposable income rose 0.1% in September, after downwardly revised 0.3% and 0.2%, respectively, in August. Wage growth accelerated to 0.4%. Consumption grew 0.6%, led by strong growth in durable goods spending. August’s increase was revised lower. The saving rate fell to 0.2%.
RELEASE: Construction Spending (C30) [United States]: -0.0%
FIRST TAKE: Construction activity was weaker than expected in September, as the value of construction put in place remained virtually unchanged from August. Private residential construction declined, while private nonresidential and public sector building activity both increased in September.
RELEASE: ISM Index [United States]: 56.8
FIRST TAKE: The ISM manufacturing index slipped to 56.8 in October and has now declined for three straight months. Production growth slowed, but the new orders and new export orders components both increased, which should help support the index in future months.
RELEASE: Economy.com Survey of Business Confidence: 25.2%
FIRST TAKE: Business confidence slipped again at the end of October. Sentiment is down across the globe since peaking in early summer. The most pronounced decline has occurred in Asia. Confidence is also off across nearly all industries. Retailers have turned notably less optimistic and weak sales are again at the top of the list of business concerns. While confidence is down, it remains consistent with a global economy that is expanding near its potential of 3%.
RELEASE: Semiconductor Billings [United States]: 1.0%
FIRST TAKE: Global semiconductor sales grew by 1.0% to a level of $18.4 billion in September, leaving them up 27.4% on the year. While chip sales continue to expand, recent growth has been slow relative to traditional seasonal trends. Sales growth in the Americas has been particularly weak.
RELEASE: Chain Store Sales Snapshot [United States]: -0.3%
FIRST TAKE: Chain store sales continued their downbeat ways in the week ending October 30, falling 0.3% according to the ICSC-UBS chain store sales index. Halloween sales reportedly boosted traffic and sales at some retailers, but that was not enough to boost the overall result. Year-over-year growth fell to 2.9%.
RELEASE: Challenger Report [United States]: 101,840
FIRST TAKE: Job cuts announcements eased slightly in October, to 101,840 though this is the second consecutive months of announcements totaling more than 100,000. Cuts had averaged 71,000 during the prior seven months. Job losses were heaviest in telecom services.
RELEASE: Risk of Recession [United States]: 27%
FIRST TAKE: Economy.com’s probability of recession rose in October to 27%, from September’s downwardly revised 25% level. The deterioration in consumer confidence and equity markets, and further tightening of yield spreads all contributed to the rise in risks. Overall, risk of recession remains at a stable but elevated level.
RELEASE: Vehicle Sales - AutoData [United States]: 16.9 Million
FIRST TAKE: Vehicle sales held up better than expected, declining to 16.9 million units seasonally adjusted annual rate, from 17.5 million units in September. A rate closer to 16.5 million was expected.
RELEASE: MBA Mortgage Applications Survey [United States]: 761.7
FIRST TAKE: The MBA index increased by 8.2% during the week ending October 29, 2004. Mortgage demand is responding to a string of declines in mortgage rates that leaves the 30-year fixed rate at 5.65%, despite an increase last week. Both purchase and refinancing applications increased. The purchase index is close to record-breaking territory. The refi index is steadily gaining strength.
RELEASE: ABC News/Money Magazine Consumer Comfort Index [United States]: -5
FIRST TAKE: In an unexpected move, the ABC News/Money Magazine consumer comfort index jumped six points to -5 to in the week ending October 31. A jump in confidence among Democrats suggests that the spike is election related. In any event, confidence stands at a nine-month high.
RELEASE: Factory Orders (SIO or M3) [United States]: -0.4%
FIRST TAKE: Factory orders declined 0.4% in September following a 0.3% decline in August. New orders for durable manufactured goods rose 0.2%, aided by a strong 9.6% increase in orders for computers and electronics equipment.
RELEASE: ISM Non-Mfg.Index [United States]: 59.8
FIRST TAKE: October showed a bit of rebound for the nation's service-producing industries as the ISM Non-Mfg Index came in at 59.8, besting both the consensus and Economy.com forecast. Although the index remained below the 60% mark for the third consecutive month, it indicates the service sector's expansion continues unabated.
RELEASE: Oil and Gas Inventories [United States]: 289.7 MB
FIRST TAKE: Commercial crude oil inventories recorded a sizable build during the week ending October 29. Market expectations had called for a more moderate increase. Distillate stocks were ambiguous as the American Petroleum Institute recorded a small build while the Energy Information Administration recorded a moderate draw. Overall, today’s inventory data will be bearish for petroleum markets.
RELEASE: Chain Store Sales [United States]: 4.1%
FIRST TAKE: Chain store sales 4.1% in October according to the ICSC chain store index, exceeding expectations and the best growth since May. Many factors including easing comparisons, more seasonal weather, and post hurricane buying contributed to the strength. Sales were not uniformly up, however, as luxury and teen retailers mostly outperformed.
RELEASE: Monster Employment Index [United States]: 114
FIRST TAKE: Monster employment index based on online help wanted ads remained at 114 in October for the second month. The index has been climbing steadily throughout the year and is 21 points higher than in October 2003.
RELEASE: Productivity and Costs [United States]: 1.9%
FIRST TAKE: Preliminary estimates for productivity growth show a 1.9% increase in the third quarter. This continues the trend toward slower growth that was also noticeable in the second quarter. Unit labor costs rose 1.6%, but are just 0.6% higher than last year.
RELEASE: Jobless Claims [United States]: 332,000
FIRST TAKE: Initial jobless claims were lower than expected during the last week in October, totaling 332,000. The trend level edged down as a result. Claims for the prior week were revised up by 1,000 - to 351,000.
RELEASE: Weekly Natural Gas Storage Report [United States]: 3,293 Bcf
FIRST TAKE: Underground storage of natural gas increased by 44 billion cubic feet during the week ending October 29, exceeding expectations for a more moderate build of 37 Bcf. Thus, today’s inventory data should have a moderately bearish effect on natural gas markets.
RELEASE: Employment Situation [United States]: 337,000
FIRST TAKE: Payroll employment soared by 337,000 in October, the strongest gain in seven months. Moreover, September’s gains were revised up to 139,000 from the originally reported 96,000, and August payroll gains were revised to 198,000 from 128,000. Rebuilding efforts in the aftermath of the hurricane boosted October construction payrolls. The unemployment rate edged up to 5.5%.
RELEASE: ECRI Future Inflation Gauge [United States]: 0.8%
FIRST TAKE: The U.S. Future Inflation Gauge (FIG) rose to 118.2 in October, pushing its smoothed annualized growth rate to 3.4% from 1.9% in September. As such, inflation pressures in the U.S. remain elevated. Other FIGs, which lag the U.S. figure by one month, were mixed in September, indicating no clear inflationary trend.
RELEASE: ECRI Weekly Leading Index [United States]: 132.0
FIRST TAKE: The smoothed, annualized growth rate of the ECRI Weekly Leading Index (WLI) improved slightly to -1.4% for the week ending October 29. This comes as the index’s level jumped from 130.4 to 132.0.
RELEASE: Consumer Credit (G19) [United States]: 9.84 billion
FIRST TAKE: Consumer credit increased by $9.8 billion in September, up 5.8% on an annualized basis. Revolving credit grew by an annualized 10.0%, while nonrevolving credit grew by 3.4%. |
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| occrider |
Week Ending November 14
RELEASE: Economy.com Survey of Business Confidence: 25.6%
FIRST TAKE: Business confidence stabilized in early November. This comes after a steady slide in confidence throughout much of the summer and early fall. Confidence is off across the globe, with the most pronounced decline occurring in Asia. Confidence is also off across nearly all industries. Retailers have turned notably less optimistic, and weak sales are again at the top of the list of business concerns. While confidence is down, it remains consistent with a global economy that is expanding near its potential of 3%.
RELEASE: Kansas City Fed Manufacturing Survey [United States]: 41
FIRST TAKE: Manufacturing activity eased some in October, but remained strong in the Tenth Federal Reserve District. The net percentage of firms reporting year-over-year increases in production dropped from 48 in September to 41 in October.
RELEASE: Wholesale Trade (MWTR) [United States]: 0.5%
FIRST TAKE: Wholesale inventories grew 0.5% in September, slightly below expectations for a 0.7% gain. Sales advanced 0.6%, in line with the consensus.
RELEASE: Job Openings and Labor Turnover Survey [United States]: 17.4%
FIRST TAKE: There was little change in the job openings and hiring rates in September. The job openings rate was unchanged at 2.4%. Similarly, the hire rate remained at 3.3%. The total separations
rate was likewise unchanged at 3.2%. The data are consistent with monthly payroll employment trends, as the August boost to payrolls of 198,000 was followed by an increase of 139,000, which was depressed mid-month by the effects of the hurricanes in the South.
RELEASE: Richmond Fed Manufacturing Survey [United States]: 14
FIRST TAKE: Manufacturing activity continued to expand in the Fifth Federal Reserve District in October, although the pace of growth slowed, consistent with national trends. The shipments index fell eight points to 14, its lowest level since July. Capacity utilization dropped 12 points and employment stagnated. However, the level of optimism about the outlook improved.
RELEASE: MBA Mortgage Applications Survey [United States]: 727.3
FIRST TAKE: The MBA index declined by 4.5% during the week ending November 5, 2004. The increase is not surprising in light of the index’s surge in the previous week. Additionally, mortgage interest rates have increased for the last two weeks. Both the refi and purchase components of the index declined.
RELEASE: ABC News/Money Magazine Consumer Comfort Index [United States]: -7
FIRST TAKE: Consumer confidence failed to build on last week’s strong gain, with the ABC News/Money Magazine consumer comfort index edging lower by two points in the week ending November 7. A dip in the economic and buying climate components is behind the overall decline.
RELEASE: Import and Export Prices [United States]: 1.5%
FIRST TAKE: Import prices rose 1.5% in October including an 11.7% increase in petroleum prices. Excluding petroleum, import prices fell 0.2% and are 2.7% higher than a year ago. Export prices rose 0.7% due to a 1.0% increase in nonagricultural export prices.
RELEASE: Jobless Claims [United States]: 333,000
FIRST TAKE: Initial jobless claims rose by 2,000, to 333,000 last week, as the prior week's claims were revised down by 1,000 to 331,000. This was well below consensus expectations. Claims are at a level that is consistent with strong labor market gains.
RELEASE: International Trade (FT900) [United States]: -$51.6 billion
FIRST TAKE: The U.S. trade deficit moderated during September. According to the BEA and Census, exports increased marginally, and imports fell to raise the balance of trade by $1.9 billion to -$51.6 billion.
RELEASE: Oil and Gas Inventories [United States]: 291.5 MB
FIRST TAKE: Commercial crude oil inventories recorded a moderate build for the week ending November 5. Net additions to inventories were in line with expectations. Thus, today’s inventory data should have a neutral effect on petroleum markets.
RELEASE: Weekly Natural Gas Storage Report [United States]: 3,327 Bcf
FIRST TAKE: Underground storage of natural gas increased by 34 Bcf during the week ending November 5. Expectations had called for a more moderate build of 22 Bcf. Thus, today’s storage data should have a slightly bearish effect on natural gas markets.
RELEASE: Treasury Budget [United States]: -57.3 billion
FIRST TAKE: The unified deficit for October, the first month of fiscal year 2005, was $57 billion, close to CBO’s preliminary estimate of $58 billion. The U.S. is on track to run another large deficit in the current fiscal year.
RELEASE: FOMC Meeting [United States]: 2.00%
FIRST TAKE: As widely expected, the FOMC raised the fed funds rate by another 25 basis points to 2.00%. The committee continues to view the risks facing its growth and inflation outlooks as balanced. The statement also maintained that policy accommodation can continue to be removed at a “measured” pace.
RELEASE: Retail Sales (MARTS) [United States]: 0.2%
FIRST TAKE: Total retail sales gained 0.2% in October, restrained by falling auto sales. Sales excluding autos sales rose 0.9%, the second consecutive healthy gain. Growth was led by gasoline stations and apparel stores. Core sales rose 0.5%. September’s gain was revised slightly higher.
RELEASE: University of Michigan Consumer Sentiment Survey [United States]: 95.5
FIRST TAKE: The University of Michigan Consumer Sentiment Index preliminary value for November rose by nearly four points from October, its first increase since July. At 95.5 the index is at its highest value since August, boosted by improvement in labor markets and declining energy prices.
RELEASE: Business Inventories (MTIS) [United States]: 0.1%
FIRST TAKE: Business inventories rose a modest 0.1%(m/m) in September. Sales advanced only 0.3%, and the business inventory-to-sales ratio was unchanged at 1.32 from August’s 1.32. The inventory-to-sales ratio is close to a historic low and hence a further decline in the rate of stockpiling is very unlikely.
RELEASE: ECRI Weekly Leading Index [United States]: 132.3
FIRST TAKE: The smoothed, annualized growth rate of the ECRI Weekly Leading Index (WLI) increased to -1.0% for the week ending November 5. This comes as the index’s level rose from 132.0 to 132.3. |
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Huge jump in the producer's price index today:
This is the largest jump in 14 years. Be watchful of the CPI as it comes out later this week, this could be significant warning signs of impending inflation. |
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Week Ending November 21
RELEASE: NY Empire State Manufacturing Survey [United States]: 19.8
FIRST TAKE: Manufacturing activity in New York state improved during November as the general business conditions index (BCI) increased from 17.4 to 19.8.
RELEASE: Economy.com Survey of Business Confidence: 25.5%
FIRST TAKE: Business confidence has stabilized during the past several weeks, after slipping throughout much of the summer and early fall. Sentiment has firmed across the globe, even in Asia, where it has fallen sharply since peaking this past summer. Confidence has also stabilized across nearly all industries, although retailers are notably less upbeat than they were a few months ago. Nearly all businesses say that sales are their most significant concern. Current business confidence levels are consistent with a global economy that is expanding near its potential of 3%.
RELEASE: Senior Loan Officer Opinion Survey [United States]: -21.1%
FIRST TAKE: The Fed’s October Loan Officer survey reported a further easing in terms and lending standards on C&I and commercial real estate loans. Banks reported stronger demand for both C&I and commercial real estate loans. Standards and terms on loans to households were little changed. Demand for residential mortgages and consumer loans reportedly declined, on net.
Thus, the Fed's rate hikes to date appear to have had little effect on lending standards or terms on various types of loans.
RELEASE: Chain Store Sales Snapshot [United States]: -0.4%
FIRST TAKE: Chain store sales slipped 0.4% in the week ending November 6 according to the ICSC-UBS chain store sales index. Year-over-year growth increased modestly, to 3.4%, as comparisons eased.
RELEASE: PPI [United States]: 1.7%
FIRST TAKE: Due largely to rapid inflation among energy products, producer prices rose rapidly at all stages of processing in October. Excluding food and energy, core prices for both intermediate and final producer goods rose by 0.3%.
RELEASE: NAHB Housing Market Index [United States]: 71
FIRST TAKE: Builder optimism remains strong, as low mortgage rates keep demand for homes solid. The NAHB index is flat in November at about 71. Notably, the present conditions index is moving up, while the indicators of future activity, expectations, and buyer traffic are softening.
RELEASE: MBA Mortgage Applications Survey [United States]: 758.3
FIRST TAKE: Mortgage demand increased during the week ending November 12, 2004, with the MBA index rising by 4%. Driving up the index is an increase in refi activity. Purchase demand slipped.
RELEASE: Consumer Price Index [United States]: 0.6%
FIRST TAKE: Consumer prices rose 0.6% in October including a 4.2% increase in energy prices. Excluding food and energy items, core inflation increased 0.2%, placing the annual rate of inflation for core consumer prices at 2.0%.
RELEASE: New Residential Construction (C20) [United States]: 2.03 million
FIRST TAKE: Residential construction increased in October, offsetting the previous month’s sharp decline. The 6.4% gain brings housing starts back up over a 2.0 million unit pace. Continued low mortgage interest rates are helping to support construction activity.
RELEASE: Industrial Production [United States]: 0.7%
FIRST TAKE: Industrial production rose 0.7% in October, increasing for the second straight month after several months of ups and downs. Increases were strong across market and industry groups. The increase in production pushed capacity utilization higher by 0.4% to 77.7%.
RELEASE: Oil and Gas Inventories [United States]: 292.3 MB
FIRST TAKE: Commercial crude oil stocks increased by 800,000 barrels during the week ending November 12, according to the Energy Information Administration. The build fell short of expectations for a more sizable build. Thus, today’s data should have a moderately bullish impact on petroleum markets. The API data are unavailable for now.
RELEASE: Jobless Claims [United States]: 334,000
FIRST TAKE: Initial jobless claims fell by 3,000 last week to 334,000, from the previous week's revised number of 337,000. Claims continue to reflect healthy labor market growth.
RELEASE: The Conference Board Leading Indicators [United States]: -0.3%
FIRST TAKE: The Conference Board’s leading indicator index fell 0.3% in October, lengthening the string of declines to five months. In addition to the decline in October, the September figure was revised to -0.3%, down from the -0.1% reported last month.
RELEASE: Weekly Natural Gas Storage Report [United States]: 3,321 Bcf
FIRST TAKE: Underground storage of natural gas decreased by 6 billion cubic feet during the week ending November 12, just in line with expectations. Today’s inventory data will have a neutral effect on natural gas markets.
RELEASE: Philadelphia Fed Survey [United States]: 20.7
FIRST TAKE: Manufacturing activity in the Third District slowed down more than expected in November. This month's reading for the Philly Fed Business Outlook Survey came in at 20.7, a 7.8 point drop from October.
RELEASE: ECRI Weekly Leading Index [United States]: 132.7
FIRST TAKE: The smoothed, annualized growth rate for the ECRI Weekly Leading Index (WLI) increased to -0.7% for the week ending November 12. The overall level of the index rose from a revised 132.2 to 132.7.
RELEASE: Internet Sales (E-Commerce Sales) [United States]: 17.6 billion
FIRST TAKE: Seasonally adjusted e-commerce sales rose to $17.6 billion in the third quarter, 4.7% above the second quarter and 21.5% better than last year. Year-over-year growth continues to slowly moderate. Internet sales' share of total retail sales excluding restaurant sales held at 1.9% in the third quarter. |
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Week Ending November 28
RELEASE: UBS Index of Investor Optimism [United States]: 69.0
FIRST TAKE: Investor confidence increased for the first time in four months, as the overall index rose seven points to 69, up from 62 in October.
RELEASE: Economy.com Survey of Business Confidence: 26.0%
FIRST TAKE: Business confidence has leveled off during the past month. This comes after a more or less steady decline throughout much of the summer and early fall. Sentiment has firmed the most in North America, where it remains the strongest. Asian confidence remains notably soft. Confidence has also stabilized across nearly all industries, although retailers continue to become less upbeat. Sales are the principal concern of most businesses. Current business confidence levels are consistent with a global economy that is expanding near its potential of 3%
RELEASE: Chain Store Sales Snapshot [United States]: 0.8%
FIRST TAKE: Chain store sales rose 0.8% in the week ending November 20 according to the ICSC-UBS chain store sales index. Year-over-year growth increased modestly, to 3.9%, its best showing since the start of July.
RELEASE: Chicago Fed National Activity Index [United States]: 0.52
FIRST TAKE: The Chicago Fed National Activities Index rose to +0.52 in October, a sharp contrast from its -0.04 value in September, suggesting strong economic growth, but also rising inflationary pressures.
RELEASE: Existing Home Sales [United States]: 6.75 Million
FIRST TAKE: Sales of existing homes remain strong in October, running at an annualized pace of 6.75 million units. This pace is about flat from September sales. A post-hurricane rebound in the South is holding up sales, however, as sales are declining in all other regions.
RELEASE: MBA Mortgage Applications Survey [United States]: 715.0
FIRST TAKE: The demand for mortgages declined during the week ending November 19, 2004, with the MBA index decreasing by 5.7% to 715. Both the refi and purchase components of the index fell.
RELEASE: Jobless Claims [United States]: 323,000
FIRST TAKE: Jobless claims fell to 323,000 last week, declining by 13,000 from the prior week. The four-week moving average, which smoothes out weekly fluctuations, has returned to its pre-recession level.
RELEASE: Durable Goods (Advance) [United States]: -0.4%
FIRST TAKE: Durable goods orders fell 0.4% in October with declines in most categories. Some of the losses partly reversed solid advances in the previous month in this extremely volatile series. Shipments were up 0.6% in October; unfilled orders advanced 0.9%--the 14th consecutive gain; and inventories were up 0.5%.
RELEASE: University of Michigan Consumer Sentiment Survey [United States]: 92.8
FIRST TAKE: Consumer sentiment improved by one point, to 92.8 at the end of November, but fell well short of the consensus expectation of 96. Both parts of the index, expectations and current conditions, rose modestly.
RELEASE: The Conference Board Help Wanted Index [United States]: 37
FIRST TAKE: Help wanted advertising rose by one point in October, to a reading of 37. A reading of 36 marked the low cyclical point, up from which advertising volume has had trouble rebounding. Given the strong October employment report, the usefulness of this gauge is questionable.
RELEASE: New Home Sales (C25) [United States]: 1,226,000
FIRST TAKE: New single-family home sales tracked a 1.226 million annualized pace in October, up 0.2% from the upward revised September rate; sales were up 7.4% from a year before. Inventory of new homes available for sale posted the fourth consecutive monthly increase and now stands at 412,000 units; at 4.1 months, the months supply remains tight.
RELEASE: Monthly Mass Layoffs [United States]: 1,241
FIRST TAKE: Employers initiated 1,241 mass layoff events involving 127,774 workers in October. The manufacturing industry continues to account for the largest portion of mass layoffs, while the West region accounted for the most initial claims for the third consecutive month.
RELEASE: Oil and Gas Inventories [United States]: 292.4 MB
FIRST TAKE: The Energy Information Administration reported a build in commercial crude oil stocks and distillate stocks for the week ending November 19. Today’s data should have a slightly bearish effect on petroleum markets. Data by the American Petroleum Institute are expected shortly.
RELEASE: Weekly Natural Gas Storage Report [United States]: 3,272 Bcf
FIRST TAKE: Underground storage of natural gas decreased by 49 billion cubic feet during the week ending November 19. The draw was steeper than anticipated; markets had expected a draw of only 11 Bcf on average. Thus, today’s data should provide some bullish momentum for natural gas markets.
RELEASE: Semiconductor Billings [United States]: 2.1%
FIRST TAKE: Global semiconductor sales grew by 1.5% to a level of $18.8 billion in October. Sales growth was seen in all regions excluding Japan, with the most rapid growth occurring in Europe and the Americas.
RELEASE: ECRI Weekly Leading Index [United States]: 132.7
FIRST TAKE: The smoothed, annualized growth rate of the ECRI Weekly Leading Index (WLI) increased to 0.1% for the week ending November 19. This comes as the index’s level rose from 132.6 to 132.7. |
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