Recent Updates

  • US: GDP by Industry (Q1), Consumer Sentiment (Jul - prelim)
  • Belgium: Retail Trade (May), Consumer Confidence Survey (Jul)
  • Canada: Retail Trade (May)
  • Canada Regional: Retail Trade by Province (May)
  • Spain: Number of Employees (Q1), Synthetic Indicators (Apr-Jun)
  • more updates...

Economy in Brief

ISM Factory Index Rose Unexpectedly
by Tom Moeller April 1, 2004

The Purchasing Managers’ Composite Index (PMI) for March released by the Institute of Supply Management rose to 62.5 from 61.4 in February. Consensus expectations were for a decline to 60.0.

During the last twenty years there has been a 71% correlation between the level of the Composite Index and the three month growth in factory sector industrial production. There has been a 56% correlation between the level of the Composite Index and quarterly growth in real GDP.

Higher readings for production (65.5 vs. 63.9) and employment (57.0 vs. 56.3) led the composite index higher. The index of vendor deliveries also rose to 67.9, indicating the slowest pace of vendor deliveries since April 1979.

The new orders index fell modestly to 65.7 and the inventory index fell 48.3 from 49.4.

The prices paid index surged to 86.0, the highest level since March 1980.

ISM Manufacturing Survey Mar Feb Mar '03 2003 2002 2001
Composite Index 62.5 61.4 46.6 53.3 52.4 43.9
  New Orders Index 65.7 66.4 47.1 58.1 56.6 46.1
Prices Paid Index (NSA) 86.0 81.5 70.0 59.6 57.6 42.9
 Producer Prices Tame In February, Mostly
by Tom Moeller April 1, 2004

Finished producer prices edged just 0.1% higher in February following a 0.6% spurt the prior month. The core PPI also rose a tame 0.1% on the heels of a 0.3% January rise. A 0.3% increase in the finished goods PPI and a 0.1% rise in the core had been the Consensus expectation.

Finished consumer goods prices rose just 0.1% after the 0.7% January spurt. Less food & energy finished consumer goods prices were unchanged (+1.0% y/y). Consumer durable prices fell 0.2% (+0.9% y/y) and core non-durable prices rose the same 0.2% as in January (1.0% y/y). Finished capital goods prices were unchanged (+1.1% y/y).

Strength in February was evident at the intermediate goods level where prices rose 0.9% after a 0.8% January spurt. Core intermediate prices surged 0.9%, the most for any month since January 1995. Prices for intermediate materials for durable manufacturing spiked 3.5% (8.0% y/y) and prices for construction components jumped 1.4% (4.1% y/y).

Crude goods prices spiked another 2.5%, led by a 5.5% surge in the core crude price measure. Higher prices for iron & steel scrap, up 19.2% m/m and 88.1% y/y, have been quite strong due to the recovery in the factory sector. Copper prices also surged 12.2% (45.9% y/y).

Finished energy prices rose just 0.2% (3.8% y/y) in February and finished foods prices were up a like 0.2% (4.1% y/y).

Producer Price Index Feb Jan Y/Y 2003 2002 2001
Finished Goods 0.1% 0.6% 2.1% 3.2% -1.3% 2.0%
  Core 0.1% 0.3% 1.1% 0.2% 0.1% 1.4%
Intermediate Goods 0.9% 0.8% 2.7% 4.7% -1.5% 0.4%
  Core 0.9% 0.6% 2.5% 2.0% -0.5% -0.1%
Crude Goods 2.5% 2.8% 10.7% 25.0% -10.6% 0.3%
  Core 5.5% 3.3% 26.2% 12.3% 3.8% -10.0%
Jobless Claims Fell
by Tom Moeller April 1, 2004

Initial claims for jobless insurance dipped 3,000 last week to 342,000 but the prior week's level was revised up sharply. The Consensus expectations had been for 340,000 claims.

The 4-week moving average of initial claims was unchanged at 340,250 (-19.1% y/y).

Continuing claims for unemployment insurance rose 32,000 in the latest week following a little-revised 47,000 drop the week prior.

The insured rate of unemployment was unchanged at 2.4%.

Comments from Federal Reserve Board Governor Ben S. Bernanke on "Trade and Jobs" can be found here.

Unemployment Insurance (000s) 3/27/04 3/20/04 Y/Y 2003 2002 2001
Initial Claims    342 345 -20.8% 403 404 406
Continuing Claims    -- 3,062 -14.3% 3,533 3,573 3,023
U.S. Construction Spending Edged Lower
by Tom Moeller April 1, 2004

The value of total construction put in place fell 0.1% in February and the previously reported 0.3% January decline was deepened to -0.8% due to lowered figures for residential and public building. No change was expected by the Consensus.

Private residential building activity fell moderately for the second consecutive month led by modest declines in single family home building (16.8% y/y). Construction on multi-family homes ticked up 1.0% (0.3% y/y) following four months of decline.

Nonresidential building rose 1.1% after a 1.8% January flop. Office building recovered just 0.3% of a 5.0% January plunge (2.7% y/y) but the health care (-2.4% y/y) and educational (+3.7% y/y) categories moved up more.

These more detailed categories represent the Census Bureau’s reclassification of construction activity into end-use groups. Finer detail is available for many of the categories; for instance, commercial construction is shown for Automotive sales and parking facilities, drugstores, building supply stores, and both commercial warehouses and mini-storage facilities. Note that start dates vary for some seasonally adjusted line items in 2000 and 2002 and that constant-dollar data are no longer computed.

Construction Put-in-place Feb Jan Y/Y 2003 2002 2001
Total -0.1% -0.8% 5.1% 4.0% 1.1% 2.7%
Private 0.1% -0.7% 7.5% 4.6% -0.2% 1.4%
  Residential -0.3% -0.2% 11.3% 10.1% 8.6% 3.3%
  Nonresidential 1.1% -1.8% -0.4% -5.5% -13.0% -1.3%
Public -1.0% -1.4% -2.5% 2.1% 5.3% 7.4%
close
large image