Tom Moeller

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<p></p>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510c.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510d.jpg" style="width: 312px; height: 265px;">
<p>The newspaper, word-of-mouth, and personal contacts each are
tools for job-searching. In this the internet age, however, postings of
available jobs can also be found online. <b>Monster.com</b>,
provided by Monster Worldwide Inc., is a web-site which keeps track of
many job listings. The monthly figures are available by Census region,
industry, and by occupation. Haver Analytics carries Monster's data
back to 2003 in its <b>SURVEYS </b>database.</p>
<p>Since its inception, the three-month change in the Monster
index has a 68% correlation with growth in nonfarm payrolls.</p>
<p>Keep in mind that 2003-04 = 100 is the base for the Monster
Index. From the end of the last recession until this past January, it
has stayed in a range from 114 to 121. Most recently, however, it's
broken from that range -- to the upside. The April figure of 133 was
the strongest in the last three months of improved readings. Moreover,
the figure was up 16.7% from its trough. For the most part,
double-digit gains have been logged across most of the U.S. Only two
regions are substantially lagging with single-digit readings in the
Mountain and in the East-South-Central areas.</p>
<p>By industry, recent improvement also has been broad-based with
strong double-digit growth in the construction, manufacturing and
retail trade sectors. Job openings in the white-collar finance
&amp; insurance, management and professional, scientific/tech
services industries also have grown at double-digit rates. Jobs
availability in health-care and education have grown at slower rates.</p>
<p>Looking once again at the overall level since 2003 shows
variation in industry postings. A level of 133 in the total indicates
that since inception, there has been a one-third rise in on-line
advertising for overall employment. That reflects a range of
near-doubling of listings for construction and government jobs to a
halving of listings for positions in finance &amp; insurance.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510e.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510f.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol">&nbsp;</th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>April '09</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol"><b>Monster Employment
Index&nbsp;</b></td>
<td>133</td>
<td>125</td>
<td>124</td>
<td>120</td>
<td>118</td>
<td>158</td>
<td>182</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;
Construction</td>
<td>195</td>
<td>176</td>
<td>165</td>
<td>170</td>
<td>167</td>
<td>202</td>
<td>225</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;
Manufacturing</td>
<td>91</td>
<td>84</td>
<td>83</td>
<td>82</td>
<td>81</td>
<td>111</td>
<td>129</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Retail
Trade</td>
<td>137</td>
<td>124</td>
<td>116</td>
<td>118</td>
<td>124</td>
<td>158</td>
<td>184</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Finance
&amp; Insurance</td>
<td>53</td>
<td>52</td>
<td>51</td>
<td>57</td>
<td>52</td>
<td>105</td>
<td>143</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Real
Estate &amp; Rental Leasing</td>
<td>62</td>
<td>63</td>
<td>57</td>
<td>53</td>
<td>54</td>
<td>92</td>
<td>135</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Company
&amp; Enterprise Mgmt.&nbsp;</td>
<td>117</td>
<td>111</td>
<td>111</td>
<td>107</td>
<td>107</td>
<td>144</td>
<td>157&nbsp;</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;
Education&nbsp;</td>
<td>89</td>
<td>82</td>
<td>81</td>
<td>80</td>
<td>81</td>
<td>106</td>
<td>126</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Heath
Care/Social Assistance</td>
<td>91</td>
<td>86</td>
<td>84</td>
<td>98</td>
<td>92</td>
<td>114</td>
<td>121</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Public
Administration</td>
<td>183</td>
<td>182</td>
<td>190</td>
<td>197</td>
<td>188</td>
<td>199</td>
<td>161</td>
</tr>
</tbody>
</table>
</body></html>

The newspaper, word-of-mouth, and personal contacts each are tools for job-searching. In this the internet age, however, postings of available jobs can also be found online. Monster.com, provided by Monster Worldwide Inc., is a web- [...]

Monster Website Helps Find Jobs, And It's Indicating Greater Availability

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<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510a.jpg" style="width: 353px; height: 265px;" align="right">Consumers
have backed away from reducing debt as rapidly as during last year. The
Federal Reserve reported late-Friday that consumer credit outstanding
rose $2.0B during March following a revised $6.0B February drop. That
decline was half the amount reported last month, suggesting that
consumers are more confident about spending. Despite this seeming
stabilization in credit outstanding, the 3.4% y/y decline ending in
March remained a near record.&nbsp;</p><p>Cutting the usage of revolving
credit remained in the forefront of consumers' pullback. A $3.2B March
decline followed a $6.0B drop and left usage down a near-record 8.8%
y/y. Pools of securitized assets led with a sharp m/m (-84.7% y/y drop.
Finance companies, however, countered and increased lending 29.3% y/y
due to a one month March spike. Commercial bank lending also jumped in
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510b.jpg" style="width: 353px; height: 265px;" align="right">March
and was up by three- quarters from last year.&nbsp; Loans
from credit unions rose 6.2% y/y while lending by savings institution
increased 4.7%.</p><p>Usage of non-revolving credit (autos &amp; other
consumer durables), which accounts for nearly two-thirds of the total,
actually rose $5.2B after the $0.2B February slip. Non-revolving credit
had fallen modestly during the recession, but has been relatively
stable for a year.&nbsp; Year-to-year figures ending in March show
that Federal government &amp; Sallie Mae lending expanded by nearly
three-quarters while commercial bank lending also rose 6.6%. These
gains were offset a nearly one-half decline in pools of securitized
assets, a 12.9% fall in savings institutions, a 4.3% decline in finance
companies and a 3.1% fall in credit union lending. <br>
</p><p>During
the last ten years, there has been a 60% correlation between the y/y
change in credit outstanding and the change in personal consumption
expenditures.&nbsp; Moreover, these figures are the major input to
the Fed's quarterly Flow of Funds accounts for the household sector.<br>
</p><p>Credit data are available in Haver's <b>USECON</b>
database. The Flow of Funds data are in Haver's <b>FFUNDS</b>
database.&nbsp;
</p>
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b>Consumer
Credit Outstanding (m/m Chg, SAAR)</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>January</b></th>
<th scope="col"><b>Y/Y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Total</td>
<td>$2.0B</td>
<td>$-6.2B</td>
<td>$6.5B</td>
<td>-3.4%</td>
<td>-4.4%</td>
<td>1.5%</td>
<td>5.7%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Revolving</td>
<td>$-3.2B</td>
<td>$-6.0B</td>
<td>$-4.3B</td>
<td>-8.8%</td>
<td>-9.6%</td>
<td>1.6%</td>
<td>8.1%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Non-revolving</td>
<td>$5.2B</td>
<td>$-0.2B</td>
<td>$10.8B</td>
<td>-0.2%</td>
<td>-1.3%</td>
<td>1.5%</td>
<td>4.4%</td>
</tr>
</tbody>
</table>
</span>
</body></html>

Consumers have backed away from reducing debt as rapidly as during last year. The Federal Reserve reported late-Friday that consumer credit outstanding rose $2.0B during March following a revised $6.0B February drop. That decline was [...]

U.S. Consumer Credit Retrenchment Eases

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<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510a.jpg" style="width: 353px; height: 265px;" align="right">Consumers
have backed away from reducing debt as rapidly as during last year. The
Federal Reserve reported late-Friday that consumer credit outstanding
rose $2.0B during March following a revised $6.0B February drop. That
decline was half the amount reported last month, suggesting that
consumers are more confident about spending. Despite this seeming
stabilization in credit outstanding, the 3.4% y/y decline ending in
March remained a near record.&nbsp;</p>
<p>Cutting the usage of revolving
credit remained in the forefront of consumers' pullback. A $3.2B March
decline followed a $6.0B drop and left usage down a near-record 8.8%
y/y. Pools of securitized assets led with a sharp m/m (-84.7% y/y drop.
Finance companies, however, countered and increased lending 29.3% y/y
due to a one month March spike. Commercial bank lending also jumped in
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510b.jpg" style="width: 353px; height: 265px;" align="right">March
and was up by three- quarters from last year.&nbsp; Loans
from credit unions rose 6.2% y/y while lending by savings institution
increased 4.7%.</p>
<p>Usage of non-revolving credit (autos &amp; other
consumer durables), which accounts for nearly two-thirds of the total,
actually rose $5.2B after the $0.2B February slip. Non-revolving credit
had fallen modestly during the recession, but has been relatively
stable for a year.&nbsp; Year-to-year figures ending in March show
that Federal government &amp; Sallie Mae lending expanded by nearly
three-quarters while commercial bank lending also rose 6.6%. These
gains were offset a nearly one-half decline in pools of securitized
assets, a 12.9% fall in savings institutions, a 4.3% decline in finance
companies and a 3.1% fall in credit union lending. <br>
</p>
<p>During
the last ten years, there has been a 60% correlation between the y/y
change in credit outstanding and the change in personal consumption
expenditures.&nbsp; Moreover, these figures are the major input to
the Fed's quarterly Flow of Funds accounts for the household sector.<br>
</p>
<p>Credit data are available in Haver's <b>USECON</b>
database. The Flow of Funds data are in Haver's <b>FFUNDS</b>
database.&nbsp;
</p>
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b>Consumer
Credit Outstanding (m/m Chg, SAAR)</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>January</b></th>
<th scope="col"><b>Y/Y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Total</td>
<td>$2.0B</td>
<td>$-6.2B</td>
<td>$6.5B</td>
<td>-3.4%</td>
<td>-4.4%</td>
<td>1.5%</td>
<td>5.7%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Revolving</td>
<td>$-3.2B</td>
<td>$-6.0B</td>
<td>$-4.3B</td>
<td>-8.8%</td>
<td>-9.6%</td>
<td>1.6%</td>
<td>8.1%</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Non-revolving</td>
<td>$5.2B</td>
<td>$-0.2B</td>
<td>$10.8B</td>
<td>-0.2%</td>
<td>-1.3%</td>
<td>1.5%</td>
<td>4.4%</td>
</tr>
</tbody>
</table>
</span>
<span id="articletitle">Monster Website Helps Find Jobs,
And It's Indicating Greater Availability</span><br>
<span id="byline">by <a href="/comment/Moeller.html">Tom
Moeller</a> May 10, 2010</span>
<span id="articletext">
<p></p>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510c.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510d.jpg" style="width: 312px; height: 265px;">
<p>The newspaper, word-of-mouth, and personal contacts each are
tools for job-searching. In this the internet age, however, postings of
available jobs can also be found online. <b>Monster.com</b>,
provided by Monster Worldwide Inc., is a web-site which keeps track of
many job listings. The monthly figures are available by Census region,
industry, and by occupation. Haver Analytics carries Monster's data
back to 2003 in its <b>SURVEYS </b>database.</p>
<p>Since its inception, the three-month change in the Monster
index has a 68% correlation with growth in nonfarm payrolls.</p>
<p>Keep in mind that 2003-04 = 100 is the base for the Monster
Index. From the end of the last recession until this past January, it
has stayed in a range from 114 to 121. Most recently, however, it's
broken from that range -- to the upside. The April figure of 133 was
the strongest in the last three months of improved readings. Moreover,
the figure was up 16.7% from its trough. For the most part,
double-digit gains have been logged across most of the U.S. Only two
regions are substantially lagging with single-digit readings in the
Mountain and in the East-South-Central areas.</p>
<p>By industry, recent improvement also has been broad-based with
strong double-digit growth in the construction, manufacturing and
retail trade sectors. Job openings in the white-collar finance
&amp; insurance, management and professional, scientific/tech
services industries also have grown at double-digit rates. Jobs
availability in health-care and education have grown at slower rates.</p>
<p>Looking once again at the overall level since 2003 shows
variation in industry postings. A level of 133 in the total indicates
that since inception, there has been a one-third rise in on-line
advertising for overall employment. That reflects a range of
near-doubling of listings for construction and government jobs to a
halving of listings for positions in finance &amp; insurance.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510e.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510f.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol">&nbsp;</th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>April '09</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol"><b>Monster Employment
Index&nbsp;</b></td>
<td>133</td>
<td>125</td>
<td>124</td>
<td>120</td>
<td>118</td>
<td>158</td>
<td>182</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;
Construction</td>
<td>195</td>
<td>176</td>
<td>165</td>
<td>170</td>
<td>167</td>
<td>202</td>
<td>225</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;
Manufacturing</td>
<td>91</td>
<td>84</td>
<td>83</td>
<td>82</td>
<td>81</td>
<td>111</td>
<td>129</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Retail
Trade</td>
<td>137</td>
<td>124</td>
<td>116</td>
<td>118</td>
<td>124</td>
<td>158</td>
<td>184</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Finance
&amp; Insurance</td>
<td>53</td>
<td>52</td>
<td>51</td>
<td>57</td>
<td>52</td>
<td>105</td>
<td>143</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Real
Estate &amp; Rental Leasing</td>
<td>62</td>
<td>63</td>
<td>57</td>
<td>53</td>
<td>54</td>
<td>92</td>
<td>135</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Company
&amp; Enterprise Mgmt.&nbsp;</td>
<td>117</td>
<td>111</td>
<td>111</td>
<td>107</td>
<td>107</td>
<td>144</td>
<td>157&nbsp;</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;
Education&nbsp;</td>
<td>89</td>
<td>82</td>
<td>81</td>
<td>80</td>
<td>81</td>
<td>106</td>
<td>126</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Heath
Care/Social Assistance</td>
<td>91</td>
<td>86</td>
<td>84</td>
<td>98</td>
<td>92</td>
<td>114</td>
<td>121</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Public
Administration</td>
<td>183</td>
<td>182</td>
<td>190</td>
<td>197</td>
<td>188</td>
<td>199</td>
<td>161</td>
</tr>
</tbody>
</table>
<span id="articletitle">OECD LEIs Continue To Advance</span><br>
<span id="byline">by <a href="/comment/Brusca.html">Robert
Brusca</a> May 10, 2010</span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510g.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>After a jackrabbit jump the OECD trend restored Leading
Economic indicators are slowing their pace. Still, viewed over six
months which is the OECD&#8217;s preferred way of using them, the grow rates
across the OECD region remain quite strong, Japan is even accelerating
to the second best growth rate in the table. Still, all rates decay
over three-months compared to six months.</p>
<p>The challenge to growth, however, is for the period ahead.
Evidence is that China is slowing. The Greek crisis and its knock-on
effects damaged Europe and have more permanently helped to re-shape
Europe&#8217;s political power structure.</p>
<p>Now a new support package is in place for Greece and a one
trillion dollar backstop for Europe&#8217;s laggards has been set up. The ECB
is supporting this with bond purchases and the Fed has reactivated its
swap lines to help. How much will these new actions compensate for the
damage that came before them? How weak will China actually be? And how
much if at all will the US economy and its financial markets be damaged
by its one-off (?) intra-day thousand point drop in the DJIA from last
week? Investing dollars, yen and euros want to know.</p>
<p>As of March things look good across the OECD area. The most
up-to-date economic data from the US have been very upbeat. Europe&#8217;s
most recent readings have been good as well, but the new investor
confidence reading from Sentix turned sharply and decisively into
negative territory.</p>
<p>Nonetheless it&#8217;s a good thing to have the economies hit by
these adverse forces while they are gaining momentum. All the trends
will bear watching. Upward momentum bolstered with these new pushes by
policymakers yet may carry the day.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="5" scope="col"><b>OECD
Trend-restored leading Indicators</b> </th>
</tr>
</thead>
<tbody>
<tr style="font-weight: bold;" class="even">
<td colspan="5" class="firstcol">Growth
progression-SAAR</td>
</tr>
<tr class="even">
<td class="firstcol">&nbsp;</td>
<td>3Mos</td>
<td>6Mos</td>
<td>12mos</td>
<td>Yr-Ago</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD</td>
<td style="color: red;">5.6%</td>
<td style="color: red;">7.3%</td>
<td>10.2%</td>
<td style="color: red;">-11.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD7</td>
<td style="color: red;">6.0%</td>
<td style="color: red;">7.8%</td>
<td>10.5%</td>
<td style="color: red;">-12.5%</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD.Ezone</td>
<td style="color: red;">2.9%</td>
<td style="color: red;">5.1%</td>
<td>9.4%</td>
<td style="color: red;">-11.4%</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD.Japan</td>
<td style="color: red;">8.0%</td>
<td>9.1%</td>
<td>8.8%</td>
<td style="color: red;">-14.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD US</td>
<td style="color: red;">8.4%</td>
<td style="color: red;">9.7%</td>
<td>11.5%</td>
<td style="color: red;">-12.8%</td>
</tr>
<tr style="font-weight: bold;">
<td colspan="5" class="firstcol">Six month
readings at
6-Mo Intervals:</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;</td>
<td>Recent six</td>
<td>6Mo Ago</td>
<td>12Mo Ago</td>
<td>18MO Ago</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD</td>
<td style="color: red;">7.3%</td>
<td>13.1%</td>
<td>-10.8%</td>
<td style="color: red;">-11.4%</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD7</td>
<td style="color: red;">7.8%</td>
<td>13.3%</td>
<td><span style="color: red;">-13.1%</span></td>
<td style="color: red;">-11.9%</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD.Eur</td>
<td style="color: red;">5.1%</td>
<td>13.8%</td>
<td>-9.0%</td>
<td style="color: red;">-13.7%</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD.Japan</td>
<td>9.1%</td>
<td>8.6%</td>
<td style="color: red;">-18.1%</td>
<td style="color: red;">-10.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">OECD US</td>
<td style="color: red;">9.7%</td>
<td>13.4%</td>
<td style="color: red;">-14.6%</td>
<td style="color: red;">-11.1%</td>
</tr>
<tr class="odd">
<td colspan="5" class="firstcol"><span style="color: red; font-weight: bold;">Slowdowns</span>
indicated by BOLD RED</td>
</tr>
</tbody>
</table>
<span id="articletitle">The Euro Area Crisis: Some
Background Data </span><br>
<span id="byline">by <a href="/comment/Curley.html">Louise
Curley</a> May 10,2010</span>
<span id="articletext">
<p></p>
<p>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510h.jpg" style="width: 353px; height: 265px;" align="right">The
European
Union, the IMF and the European Central Bank agreed today on a package
of emergency measures that are intended to stabilize financial
conditions in the Eurozone.&nbsp; Government deficits and rising
debt, particularly in Greece threatened the stability of the Euro
Area.&nbsp; By last Friday, the euro was down to $1.2746 a decline
of almost 16% from the high of $1.512 reached on December 3rd of last
year. In addition to uncertainty in Greece there were fears that other
countries, notably Portugal, Spain and Ireland would be next in line.
The continuation of the Euro Area was in question.&nbsp; The
success of the rescue plan will not be known for some time, however,
the initial response of the financial markets has been positive. The
euro has risen almost 2% today and stock markets around the world are
up sharply.</p>
<p>Data for the sixteen countries in Euro Area and the eleven
other countries that make up&nbsp; the European Union are available
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100510i.jpg" style="width: 353px; height: 265px;" align="right">in
the Haver Data base--EUROSTAT.&nbsp; To illustrate the
seriousness of the problems confronting Greece, Portugal, Spain and
Ireland we have attached two charts.&nbsp; The first shows the
government deficit as a percentage of Gross Domestic Product on an
annual basis.&nbsp; In 2009, and conditions have probably worsened
since the, the government deficit as a percent of GDP was 9.4% in
Portugal, 11.2% in Spain, 13.6% in Greece and even higher at 14.3% in
Ireland.&nbsp;&nbsp; It should be noted that among the
convergence criteria for membership in the Euro Area, the deficit as a
percentage of GDP was expected to be no higher than 3%.&nbsp; Even
allowing for occasional shortfalls, the 2009 percentages are
alarming.&nbsp; As shown in the chart and the&nbsp; table
below, the deficit as a percentage of GDP for Greece has been
consistently above the 3% level.</p>
<p> The second chart showing government
debt as a percentage of GDP tells a similar story. (These data are
quarterly.)&nbsp; Government Debt in Portugal was 73.7% of GDP in
the third quarter of last year.&nbsp; In Spain it was 49.7%, in
Ireland, 62.25 and in Greece,113.2%.&nbsp; In this case, Spain's
debt as a percentage of GDP is below the convergence criterion of
60%.&nbsp; In Portugal and Ireland the debt to GDP percentages are
not too far above the 60% standard, but in Greece, the percentage is
almost double the standard and has been close to 100 over the past two
years.&nbsp;</p>
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol">&nbsp;</th>
<th scope="col"><b>2009&nbsp;</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
<th scope="col"><b>2006</b></th>
<th scope="col"><b>2005</b></th>
<th scope="col"><b>2004</b></th>
<th scope="col"><b>2003</b></th>
<th scope="col"><b>2002</b></th>
</tr>
</thead>
<tbody>
<tr class="even">
<td colspan="9" class="firstcol"><b>Deficit
as % of
GDP</b></td>
</tr>
<tr class="odd">
<td class="firstcol">Portugal</td>
<td>-9.4</td>
<td>-2.8</td>
<td>-2.6</td>
<td>-3.9</td>
<td>-6.1</td>
<td>-3.4</td>
<td>-2.9</td>
<td>-2.8</td>
</tr>
<tr class="odd">
<td class="firstcol">Spain</td>
<td>-11.2</td>
<td>-4.1</td>
<td>1.9</td>
<td>2.0</td>
<td>1.0</td>
<td>-0.3</td>
<td>-0.2</td>
<td>-0.5</td>
</tr>
<tr class="odd">
<td class="firstcol">Ireland</td>
<td>-14.2</td>
<td>-7.3</td>
<td>0.1</td>
<td>3.0</td>
<td>1.7</td>
<td>1.4</td>
<td>0.4</td>
<td>-0.4</td>
</tr>
<tr class="odd">
<td class="firstcol">Greece</td>
<td>-13.6</td>
<td>-7.7</td>
<td>-5.1</td>
<td>-3.6</td>
<td>-5.2</td>
<td>-7.5</td>
<td>-5.6</td>
<td>-4.8</td>
</tr>
<tr class="grey2">
<td style="font-weight: bold;" class="firstcol">Debt
as % of GDP</td>
<td><b>Q3 09</b></td>
<td><b>Q2 09</b></td>
<td><b>Q1 097</b></td>
<td><b>Q4 08</b></td>
<td><b>Q3 08</b></td>
<td><b>Q2 08</b></td>
<td><b>Q1 08</b></td>
<td><b>Q4 07</b></td>
</tr>
<tr class="odd">
<td class="firstcol">Portugal</td>
<td>73.7</td>
<td>74.2</td>
<td>68.7</td>
<td>66.3</td>
<td>64.0</td>
<td>63.8</td>
<td>62.6</td>
<td>63.6</td>
</tr>
<tr class="odd">
<td class="firstcol">Spain</td>
<td>49.7</td>
<td>47.1</td>
<td>43.0</td>
<td>39.7</td>
<td>36.7</td>
<td>35.8</td>
<td>35.3</td>
<td>36.1</td>
</tr>
<tr class="odd">
<td class="firstcol">Ireland</td>
<td>62.2</td>
<td>59.3</td>
<td>49.9</td>
<td>44.0</td>
<td>38.9</td>
<td>32.4</td>
<td>27.6</td>
<td>25.2</td>
</tr>
<tr class="odd">
<td class="firstcol">Greece</td>
<td>113.2</td>
<td>111.4</td>
<td>107.0</td>
<td>99.2</td>
<td>98.5</td>
<td>97.5</td>
<td>97.3</td>
<td>94.1</td>
</tr>
</tbody>
</table>
</span>
</body></html>

U.S. Consumer Credit RetrenchmentEases

Robert Brusca

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<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507f.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>In the midst of chaos in markets in the aftermath of the US
stock market snafu on Thursday and ongoing turmoil over Greece in
Europe despite the Greek bail-out being substantially approved by all
parties, Europe&#8217;s growth is looking better. German IP rose by a sharp
4% in March on the same day that the US was reporting nearly 300K in
job gains for April. Ironically, in the midst of such upbeat growth
reports markets are starting to get negative on global growth prospects
over Greece.</p>
<p>The German report on strong IP shows us building strength over
three-months compared to six- months. Both MFG and construction are
building momentum. Unfortunately the output of consumer goods continues
to not just lag but to decline and the pace of decline for consumer
goods output has accelerated. But for intermediate and capital goods,
output is advancing and accelerating strongly. Germany has a two-tier
economy. One tier seems to be strongly supported by capital goods
spending and orders linked to strong international demand. The other
tier is its consumer goods sector that is weak both in Germany and
abroad leading the output in that sector to falter. Still the message
overall is that IP is advancing and doing so with strength and good
solid underpinnings.</p>
<p>Our main point here, is that growth both in Europe and in the
US is looking better, not worse despite what markets are doing. As for
analysts, in an effort to look &#8216;smart&#8217; they are always looking for a
way to explain the &#8216;decline du-jour.&#8217; But the recent news has been
good, not bad. In recent days we have seen patches approved to stopper
those things that could have gotten out of control and hampered growth.
I&#8217;m not sure we want to throw a party for the March German IP report
and the April US employment report (and its revisions) but we do have
on balance net good news over the past two days. And that is not what
markets are trading to. In the end, that is a point to ponder. But it&#8217;s
not a reason to throw out the good news and go rummaging in the trash
bin of old news for an excuse to explain what appears to be an
irrational act by the markets, and one that could easily be reversed in
the coming weeks. Markets have seemingly irrational sharp sell offs
from time to time. Accept it. Think about it. But don&#8217;t let it cripple
you or lead you to shove a square peg through a round hole to get
closure.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup><col></colgroup>
<thead><tr><th colspan="8" scope="col"> Total German IP</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td style="font-weight: bold;" class="firstcol">Saar exept m/m</td>
<td style="font-weight: bold;">Mar-10</td>
<td style="font-weight: bold;">Feb-10</td>
<td style="font-weight: bold;">Jan-10</td>
<td style="font-weight: bold;">3-mo</td>
<td style="font-weight: bold;">6-mo</td>
<td style="font-weight: bold;">12-mo</td>
<th>Quarter- <br>
to-Date
</th></tr>
<tr>
<td class="firstcol">IP total</td>
<td>4.0%</td>
<td>-0.2%</td>
<td>0.1%</td>
<td>16.4%</td>
<td>3.9%</td>
<td>8.6%</td>
<td>3.7%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Consumer</td>
<td>1.7%</td>
<td>-2.3%</td>
<td>-0.3%</td>
<td>-3.5%</td>
<td>-0.2%</td>
<td>2.9%</td>
<td>1.2%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Capital</td>
<td>4.4%</td>
<td>1.2%</td>
<td>-1.7%</td>
<td>16.4%</td>
<td>1.3%</td>
<td>6.9%</td>
<td>3.9%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Intermed</td>
<td>3.5%</td>
<td>-0.1%</td>
<td>3.4%</td>
<td>30.2%</td>
<td>9.2%</td>
<td>15.3%</td>
<td>8.5%</td>
</tr>
<tr style="font-weight: bold;" class="odd">
<td colspan="8" class="firstcol">Memo</td>
</tr>
<tr>
<td class="firstcol">Construction</td>
<td>26.7%</td>
<td>0.0%</td>
<td>-14.2%</td>
<td>39.8%</td>
<td>12.1%</td>
<td>1.6%</td>
<td>-27.3%</td>
</tr>
<tr>
<td class="firstcol">MFG IP</td>
<td>3.4%</td>
<td>0.0%</td>
<td>0.6%</td>
<td>17.4%</td>
<td>3.7%</td>
<td>9.7%</td>
<td>5.0%</td>
</tr>
<tr>
<td class="firstcol">MFG Orders</td>
<td>5.0%</td>
<td>0.0%</td>
<td>0.1</td>
<td>49.1%</td>
<td>18.7%</td>
<td>26.0%</td>
<td>28.5%</td>
</tr>
</tbody>
</table>
</body></html>

In the midst of chaos in markets in the aftermath of the US stock market snafu on Thursday and ongoing turmoil over Greece in Europe despite the Greek bail-out being substantially approved by all parties, Europe’s growth is looking [...]

German IP Continues To Run Up

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<p></p>
<p><img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507a.jpg" border="0" height="265" width="312">
<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507b.jpg" border="0" height="265" width="312"></p>
<p>Several factors made the latest job report, from the Bureau of
Labor Statistics, an interesting read. The best news was an improvement
in the rate of hiring. But that wasn't as encouraging as at first
glance because it was accompanied by a rise in the jobless rate. The
rate increase, however, wasn't too troubling because it didn't reflect
job cuts. The bottom line is that earlier weakness in the labor market
is on the mend.</p>
<p>Let's begin with the figures from the establishment survey
which indicate a firm 290,000 rise in nonfarm payrolls. The gain
followed an upwardly revised 230,000 March increase. These increases
were inflated by a 66,000 increase in Census workers which followed a
48,000 March rise. Cutting out government hiring altogether left
private sector jobs up 231,000 (-1.2% y/y), the strongest of the five
increases in the last six months.</p>
<p>The payroll gain reflected a 116,000 increase in
private-services. It also was the best of five gains during the last
six months. Since December, jobs have risen 0.5%. Temporary jobs, which
have sometimes been a leading job market indicator, rose 26,200 (13.8%
y/y) for the seventh consecutive monthly increase. Professional
&amp; business services jobs rose 80,000 (0.1% y/y), leisure
&amp; hospitality employment increased 45,000 (0.1% y/y) and
education &amp; health services jobs rose 35,000 (2.0% y/y).
Factory sector employment followed the service sector with a 44,000
<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507e.jpg" align="right" border="0" height="265" width="312">increase which was the fourth consecutive
monthly increase. Gains have
been notable in the metals &amp; machinery industries. Amongst
construction businesses, employment rose 14,000 but it was just the
second monthly gain of the economic recovery.</p>
<p>Most impressive was the rise in the breadth of hiring last
month. Sixty-four percent of 278 private industries increased hiring.
That's improved from the recession low when just 17% were increasing
payrolls. During the last three months 61% increased hiring. As
impressive was that a like 66% of manufacturing industries raised
hiring versus 5% at the low.</p>
<p>Not only are there more individuals being hired, they are
working longer. The total workweek of 34.1 hours was up from a low of
33.7 last autumn and was the longest in over a year. The factory sector
workweek showed an even greater expansion to its longest since early in
the recession.</p>
<p>Workers' pay is starting to improve as well. Last month's 0.3%
increase in average hourly earnings followed two months of having been
unchanged. Nevertheless the y/y gain of 2.3% remains close to its
weakest since early-2004.</p>
<p>Let's look at the unemployment rate's increase. The rise to
9.9% reversed three months of stability when the rate was at its lowest
since the recession's end. But here's where the figure gets most
interesting. The increase was the product of a 550,000 rise (-1.0% y/y)
in employment which roughly matched the strongest since before the
recession began. That gain was accompanied by a 805,000 jump (-0.0%
y/y) in the labor force which was the strongest since the recession's
end.</p>
<p>The unemployment rate hides, however, some added strains on
the labor market. First, the average duration of unemployment rose to a
record 33.0 weeks, roughly twice the level when the recession began. Of
those unemployed, 45.9% have been so for six months or longer. If those
who are unemployed are added to those individuals who either are
marginally attached or who are part-time for economic reasons, the rate
rose last month to 17.1%, just under the recession high.</p>
<p>The figures referenced above are available in Haver's <b>USECON</b>
database. Additional detail can be found in the <b>LABOR </b>and
in the <b>EMPL</b> databases.</p>
<p><strong>What is behind the rise in long-term
unemployment?</strong> from the Federal Reserve Bank of Chicago
is available <a href="http://www.chicagofed.org/digital_assets/publications/economic_perspectives/2010/2qtr2010_part1_aaronson_mazumder_schechter.pdf">here</a>.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507c.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507d.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b>Employment:
000s</b></th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>Y/Y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Payroll Employment &nbsp;</td>
<td>290</td>
<td>230</td>
<td>39</td>
<td>-1.0%</td>
<td>-4.3%</td>
<td>-0.6%</td>
<td>1.1%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;Previous</td>
<td>--</td>
<td>162</td>
<td>-14</td>
<td>--</td>
<td>--</td>
<td>--</td>
<td>--</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;&nbsp;Manufacturing</td>
<td>44</td>
<td>19</td>
<td>16</td>
<td>-3.5%</td>
<td>-11.3%</td>
<td>-3.4%</td>
<td>-2.0%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;Construction</td>
<td>14</td>
<td>26</td>
<td>-51</td>
<td>-9.0%</td>
<td>-15.7%</td>
<td>-6.1%</td>
<td>-0.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;&nbsp;Private
Service Producing</td>
<td>166</td>
<td>119</td>
<td>90</td>
<td>-0.3%</td>
<td>-3.4%</td>
<td>-0.2%</td>
<td>1.7%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;Government</td>
<td>59</td>
<td>56</td>
<td>-23</td>
<td>-0.5%</td>
<td>0.2%</td>
<td>1.3%</td>
<td>1.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">Average Weekly Hours</td>
<td>34.1</td>
<td>34.0</td>
<td>33.9</td>
<td>33.9(April '09)</td>
<td>33.1</td>
<td>33.6</td>
<td>33.8</td>
</tr>
<tr>
<td class="firstcol">Average Hourly Earnings</td>
<td>0.3%</td>
<td>-0.1%</td>
<td>0.1%</td>
<td>2.3%</td>
<td>3.0%</td>
<td>3.8%</td>
<td>4.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">Unemployment Rate</td>
<td>9.9%</td>
<td>9.7%</td>
<td>9.7%</td>
<td>8.6%(April '09)</td>
<td>9.3%</td>
<td>5.8%</td>
<td>4.6%</td>
</tr>
</tbody>
</table>
</body></html>

Several factors made the latest job report, from the Bureau of Labor Statistics, an interesting read. The best news was an improvement in the rate of hiring. But that wasn't as encouraging as at first glance because it was accompanied [...]

U.S. Job Market Emits Mixed Signals; Payrolls & Jobless Rate Firm

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<span id="articletext">
<p></p>
<p><img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507a.jpg" border="0" height="265" width="312">
<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507b.jpg" border="0" height="265" width="312"></p>
<p>Several factors made the latest job report, from the Bureau of
Labor Statistics, an interesting read. The best news was an improvement
in the rate of hiring. But that wasn't as encouraging as at first
glance because it was accompanied by a rise in the jobless rate. The
rate increase, however, wasn't too troubling because it didn't reflect
job cuts. The bottom line is that earlier weakness in the labor market
is on the mend.</p>
<p>Let's begin with the figures from the establishment survey
which indicate a firm 290,000 rise in nonfarm payrolls. The gain
followed an upwardly revised 230,000 March increase. These increases
were inflated by a 66,000 increase in Census workers which followed a
48,000 March rise. Cutting out government hiring altogether left
private sector jobs up 231,000 (-1.2% y/y), the strongest of the five
increases in the last six months.</p>
<p>The payroll gain reflected a 116,000 increase in
private-services. It also was the best of five gains during the last
six months. Since December, jobs have risen 0.5%. Temporary jobs, which
have sometimes been a leading job market indicator, rose 26,200 (13.8%
y/y) for the seventh consecutive monthly increase. Professional
&amp; business services jobs rose 80,000 (0.1% y/y), leisure
&amp; hospitality employment increased 45,000 (0.1% y/y) and
education &amp; health services jobs rose 35,000 (2.0% y/y).
Factory sector employment followed the service sector with a 44,000
<img src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507e.jpg" align="right" border="0" height="265" width="312">increase which was the
fourth consecutive
monthly increase. Gains have
been notable in the metals &amp; machinery industries. Amongst
construction businesses, employment rose 14,000 but it was just the
second monthly gain of the economic recovery.</p>
<p>Most impressive was the rise in the breadth of hiring last
month. Sixty-four percent of 278 private industries increased hiring.
That's improved from the recession low when just 17% were increasing
payrolls. During the last three months 61% increased hiring. As
impressive was that a like 66% of manufacturing industries raised
hiring versus 5% at the low.</p>
<p>Not only are there more individuals being hired, they are
working longer. The total workweek of 34.1 hours was up from a low of
33.7 last autumn and was the longest in over a year. The factory sector
workweek showed an even greater expansion to its longest since early in
the recession.</p>
<p>Workers' pay is starting to improve as well. Last month's 0.3%
increase in average hourly earnings followed two months of having been
unchanged. Nevertheless the y/y gain of 2.3% remains close to its
weakest since early-2004.</p>
<p>Let's look at the unemployment rate's increase. The rise to
9.9% reversed three months of stability when the rate was at its lowest
since the recession's end. But here's where the figure gets most
interesting. The increase was the product of a 550,000 rise (-1.0% y/y)
in employment which roughly matched the strongest since before the
recession began. That gain was accompanied by a 805,000 jump (-0.0%
y/y) in the labor force which was the strongest since the recession's
end.</p>
<p>The unemployment rate hides, however, some added strains on
the labor market. First, the average duration of unemployment rose to a
record 33.0 weeks, roughly twice the level when the recession began. Of
those unemployed, 45.9% have been so for six months or longer. If those
who are unemployed are added to those individuals who either are
marginally attached or who are part-time for economic reasons, the rate
rose last month to 17.1%, just under the recession high.</p>
<p>The figures referenced above are available in Haver's <b>USECON</b>
database. Additional detail can be found in the <b>LABOR </b>and
in the <b>EMPL</b> databases.</p>
<p><strong>What is behind the rise in long-term
unemployment?</strong> from the Federal Reserve Bank of Chicago
is available <a href="http://www.chicagofed.org/digital_assets/publications/economic_perspectives/2010/2qtr2010_part1_aaronson_mazumder_schechter.pdf">here</a>.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507c.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507d.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b>Employment:
000s</b></th>
<th scope="col"><b>April</b></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>Y/Y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Payroll Employment &nbsp;</td>
<td>290</td>
<td>230</td>
<td>39</td>
<td>-1.0%</td>
<td>-4.3%</td>
<td>-0.6%</td>
<td>1.1%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;Previous</td>
<td>--</td>
<td>162</td>
<td>-14</td>
<td>--</td>
<td>--</td>
<td>--</td>
<td>--</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;&nbsp;Manufacturing</td>
<td>44</td>
<td>19</td>
<td>16</td>
<td>-3.5%</td>
<td>-11.3%</td>
<td>-3.4%</td>
<td>-2.0%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;Construction</td>
<td>14</td>
<td>26</td>
<td>-51</td>
<td>-9.0%</td>
<td>-15.7%</td>
<td>-6.1%</td>
<td>-0.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;&nbsp;Private
Service Producing</td>
<td>166</td>
<td>119</td>
<td>90</td>
<td>-0.3%</td>
<td>-3.4%</td>
<td>-0.2%</td>
<td>1.7%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;Government</td>
<td>59</td>
<td>56</td>
<td>-23</td>
<td>-0.5%</td>
<td>0.2%</td>
<td>1.3%</td>
<td>1.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">Average Weekly Hours</td>
<td>34.1</td>
<td>34.0</td>
<td>33.9</td>
<td>33.9(April '09)</td>
<td>33.1</td>
<td>33.6</td>
<td>33.8</td>
</tr>
<tr>
<td class="firstcol">Average Hourly Earnings</td>
<td>0.3%</td>
<td>-0.1%</td>
<td>0.1%</td>
<td>2.3%</td>
<td>3.0%</td>
<td>3.8%</td>
<td>4.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">Unemployment Rate</td>
<td>9.9%</td>
<td>9.7%</td>
<td>9.7%</td>
<td>8.6%(April '09)</td>
<td>9.3%</td>
<td>5.8%</td>
<td>4.6%</td>
</tr>
</tbody>
</table>
<span id="articletitle">German IP Continues To Run Up</span><br>
<span id="byline">by <a href="/comment/Brusca.html">Robert
Brusca</a> May 07, 2010</span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100507f.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>In the midst of chaos in markets in the aftermath of the US
stock market snafu on Thursday and ongoing turmoil over Greece in
Europe despite the Greek bail-out being substantially approved by all
parties, Europe&#8217;s growth is looking better. German IP rose by a sharp
4% in March on the same day that the US was reporting nearly 300K in
job gains for April. Ironically, in the midst of such upbeat growth
reports markets are starting to get negative on global growth prospects
over Greece.</p>
<p>The German report on strong IP shows us building strength over
three-months compared to six- months. Both MFG and construction are
building momentum. Unfortunately the output of consumer goods continues
to not just lag but to decline and the pace of decline for consumer
goods output has accelerated. But for intermediate and capital goods,
output is advancing and accelerating strongly. Germany has a two-tier
economy. One tier seems to be strongly supported by capital goods
spending and orders linked to strong international demand. The other
tier is its consumer goods sector that is weak both in Germany and
abroad leading the output in that sector to falter. Still the message
overall is that IP is advancing and doing so with strength and good
solid underpinnings.</p>
<p>Our main point here, is that growth both in Europe and in the
US is looking better, not worse despite what markets are doing. As for
analysts, in an effort to look &#8216;smart&#8217; they are always looking for a
way to explain the &#8216;decline du-jour.&#8217; But the recent news has been
good, not bad. In recent days we have seen patches approved to stopper
those things that could have gotten out of control and hampered growth.
I&#8217;m not sure we want to throw a party for the March German IP report
and the April US employment report (and its revisions) but we do have
on balance net good news over the past two days. And that is not what
markets are trading to. In the end, that is a point to ponder. But it&#8217;s
not a reason to throw out the good news and go rummaging in the trash
bin of old news for an excuse to explain what appears to be an
irrational act by the markets, and one that could easily be reversed in
the coming weeks. Markets have seemingly irrational sharp sell offs
from time to time. Accept it. Think about it. But don&#8217;t let it cripple
you or lead you to shove a square peg through a round hole to get
closure.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup><col></colgroup>
<thead><tr>
<th colspan="8" scope="col"> Total German IP</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td style="font-weight: bold;" class="firstcol">Saar
exept m/m</td>
<td style="font-weight: bold;">Mar-10</td>
<td style="font-weight: bold;">Feb-10</td>
<td style="font-weight: bold;">Jan-10</td>
<td style="font-weight: bold;">3-mo</td>
<td style="font-weight: bold;">6-mo</td>
<td style="font-weight: bold;">12-mo</td>
<th>Quarter- <br>
to-Date
</th>
</tr>
<tr>
<td class="firstcol">IP total</td>
<td>4.0%</td>
<td>-0.2%</td>
<td>0.1%</td>
<td>16.4%</td>
<td>3.9%</td>
<td>8.6%</td>
<td>3.7%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Consumer</td>
<td>1.7%</td>
<td>-2.3%</td>
<td>-0.3%</td>
<td>-3.5%</td>
<td>-0.2%</td>
<td>2.9%</td>
<td>1.2%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Capital</td>
<td>4.4%</td>
<td>1.2%</td>
<td>-1.7%</td>
<td>16.4%</td>
<td>1.3%</td>
<td>6.9%</td>
<td>3.9%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Intermed</td>
<td>3.5%</td>
<td>-0.1%</td>
<td>3.4%</td>
<td>30.2%</td>
<td>9.2%</td>
<td>15.3%</td>
<td>8.5%</td>
</tr>
<tr style="font-weight: bold;" class="odd">
<td colspan="8" class="firstcol">Memo</td>
</tr>
<tr>
<td class="firstcol">Construction</td>
<td>26.7%</td>
<td>0.0%</td>
<td>-14.2%</td>
<td>39.8%</td>
<td>12.1%</td>
<td>1.6%</td>
<td>-27.3%</td>
</tr>
<tr>
<td class="firstcol">MFG IP</td>
<td>3.4%</td>
<td>0.0%</td>
<td>0.6%</td>
<td>17.4%</td>
<td>3.7%</td>
<td>9.7%</td>
<td>5.0%</td>
</tr>
<tr>
<td class="firstcol">MFG Orders</td>
<td>5.0%</td>
<td>0.0%</td>
<td>0.1</td>
<td>49.1%</td>
<td>18.7%</td>
<td>26.0%</td>
<td>28.5%</td>
</tr>
</tbody>
</table>
</body></html>

U.S. Job Market Emits MixedSignals; Payrolls & Jobless Rate Firm

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<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100506e.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>The Bureau of Labor Statistics reported that initial claims
for jobless insurance fell 7,000 to 444,000 after the prior week's
lessened 8,000 drop. The latest level was near this cycle's lowest but
fell slightly short of Consensus expectations for a decline to 440,000
claims. Last week's figure was down from the recession peak of 651,000
reached in March of 2009. The four-week moving average of initial
claims increased to 458,500.</p>
<p>A 59,000 decline in continuing claims for unemployment
insurance during the latest week followed a little-revised 10,000 drop
during the prior week. They were down by one-third from the June '09
peak. The overall decline is a function of the improved job market but
also reflects the exhaustion of 26 weeks of unemployment benefits.
Continuing claims provide an indication of workers' ability to find
employment. The four-week average of continuing claims at 4.649M
remained near the cycle low. This series dates back to 1966.</p>
<p>Extended benefits for unemployment insurance slipped w/w to
201,487. However, they were down by three-quarters from a peak of
597,688 reached in November.</p>
<p>The insured unemployment rate remained at 3.6% where it has
been since mid-February. The rate reached a high of 4.9% during May.
During the last ten years, there has been a 96% correlation between the
level of the insured unemployment rate and the overall rate of
unemployment published by the Bureau of Labor Statistics.</p>
<p>The highest insured unemployment rates in the week ending
April 17 were in Alaska (6.6 percent), Puerto Rico (6.0), Oregon (5.8),
Nevada (5.1), Wisconsin (5.1), California (5.0), Michigan (4.9),
Montana (4.9), Pennsylvania (4.9), Idaho (4.7), and North Carolina
(4.7). The lowest insured unemployment rates were in Virginia (1.9),
Texas (2.3), Georgia (2.8), Maryland (3.0), Florida (3.2), Wyoming
(3.4), Ohio (3.4), New York (3.5) and Maine (3.7). These data are not
seasonally adjusted but the overall insured unemployment rate is.</p>
<p>The unemployment insurance claims data is available in Haver's
<b>WEEKLY</b> database and the state data is in the <b>REGIONW</b>
database.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100506f.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100506g.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b><a ;="" href="http://www.haverselect.com/dlx/WEEKLY/@W5/@W507/@W507.HTM" style="color: black;">Unemployment Insurance (000s)</a></b></th>
<th scope="col"><b>05/01/10</b></th>
<th scope="col"><b>04/24/10</b></th>
<th scope="col"><b>04/17/10</b></th>
<th scope="col"><b>Y/Y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Initial Claims</td>
<td>444</td>
<td>451</td>
<td>459</td>
<td>-26.5%</td>
<td>572</td>
<td>419</td>
<td>321</td>
</tr>
<tr>
<td class="firstcol">Continuing Claims</td>
<td>--</td>
<td>4,594</td>
<td>4,653</td>
<td>-26.2%</td>
<td>5,809</td>
<td>3,340</td>
<td>2,549</td>
</tr>
<tr class="odd">
<td class="firstcol">Insured Unemployment Rate (%)</td>
<td>--</td>
<td>3.6</td>
<td>3.6</td>
<td>4.9(5/2009)</td>
<td>4.4</td>
<td>2.5</td>
<td>1.9</td>
</tr>
</tbody>
</table>
</body></html>

The Bureau of Labor Statistics reported that initial claims for jobless insurance fell 7,000 to 444,000 after the prior week's lessened 8,000 drop. The latest level was near this cycle's lowest but fell slightly short of Consensus [...]

U.S. Initial Unemployment Insurance Claims Decline

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<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100506d.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>In March German orders spurted beyond expectations rising by
5% after being flat in February. Foreign orders built on a 1.7% gain in
February rising by 4.7% in March. Domestic orders spurted by 5.4%
coming off a 1.7% decline in February. Over three months domestic and
foreign orders are growing at almost identical 48% compounded growth
rates; over six month their growth is clearly identical as well. Yr/Yr
foreign orders are stronger, rising by 29% compared to nearly 23% for
domestic orders. German orders are strong no matter how you slice them.
But not all sectors are strong.</p>
<p>Consumer orders remain mixed in Germany. Consumer durables
goods orders did better in March by reducing the pace at which they
declined to -0.7% from -2.4% in February. Consumer durable goods orders
are rising over three months, however, at a compounded annual rate pace
of just 3.7%, up from 1.8% over six months. Consumer nondurables orders
spiked by 5.4% in March, after dropping by 2.2% in February. They are
still declining at an 8.2% annual rate over three months, however.</p>
<p>Capital goods are the backbone of the German recovery. Those
orders rose by 2.4% in March after rising by 0.5% in February. Over
three months capital goods orders are rising at a 24.7% pace up from an
11.7% pace over six months and from 6.7% Yr/Yr.</p>
<p>Intermediate goods orders also rose in March making gains of
2.8% after edging lower by 0.3% in February. Intermediate goods orders
spurted at a 21% annual rate over three months compared to rising at a
10% over three months.</p>
<p>Manufacturing sales also were strong in March and their
sequential growth rates show persisting strength.</p>
<p>On balance German orders were an upside surprise. The strength
remains in the industrial sector with consumer goods starting to break
out of their declining ways but still not clearly shaking off the
lethargy. Orders grew at a 28% annualized rate in the quarter while
sales grew at a 5% pace.</p>
<p>The weakening euro is going to help cement these trends as
long as the financial problems in Greece do not spread too much and
damp growth in the e-Zone and the surrounding environs. Right now
tensions are running high as Moody&#8217;s warned on potential banking sector
problems as banks hold a lot of government bonds and it is some of the
debt-ridden European government&#8216;s that issued those bonds that are
under ratings pressure. If debt reschedulings were to occur there could
be losses pushed onto bond holders and slapped onto bank balance
sheets. In its meeting today the ECB held rates steady but that was all
it held steady. So far it is not willing to do nay more, much to the
markets consternation. Nervousness in the European markets is clear.
The potential for knock-on effects even to an economy like Germany that
seems to be doing so well is a real risk.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th colspan="9">German Orders and Sales
By Sector and Origin</th>
</tr>
</thead>
<tbody>
<tr class="grey2">
<td class="firstcol">Real and SA</td>
<td colspan="3">% M/M</td>
<td colspan="5">% Saar</td>
</tr>
<tr class="grey2">
<td class="firstcol">&nbsp;</td>
<td>Mar-10</td>
<td>Feb-10</td>
<td>Jan-10</td>
<td>3-MO</td>
<td>6-Mo</td>
<td>12-Mo</td>
<td>YrAgo</td>
<td>QTR-2-Date</td>
</tr>
<tr class="odd">
<td class="firstcol">Total Orders</td>
<td>5.0%</td>
<td>0.0%</td>
<td>5.2%</td>
<td>49.1%</td>
<td>22.1%</td>
<td>26.0%</td>
<td>-32.8%</td>
<td>28.5%</td>
</tr>
<tr>
<td class="firstcol">Foreign</td>
<td>4.7%</td>
<td>1.7%</td>
<td>3.8%</td>
<td>48.7%</td>
<td>21.9%</td>
<td>29.0%</td>
<td>-36.2%</td>
<td>28.5%</td>
</tr>
<tr class="odd">
<td class="firstcol">Domestic</td>
<td>5.4%</td>
<td>-1.7%</td>
<td>6.7%</td>
<td>48.9%</td>
<td>22.0%</td>
<td>22.8%</td>
<td>-28.6%</td>
<td>28.2%</td>
</tr>
<tr class="grey2">
<td colspan="9" class="firstcol">Real Sector Sales</td>
</tr>
<tr class="odd">
<td class="firstcol">MFG/Mining</td>
<td>2.9%</td>
<td>-0.2%</td>
<td>1.2%</td>
<td>16.3%</td>
<td>7.8%</td>
<td>8.5%</td>
<td>-21.8%</td>
<td>5.6%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Consumer</td>
<td>4.6%</td>
<td>-2.1%</td>
<td>-4.0%</td>
<td>-6.8%</td>
<td>-3.5%</td>
<td>2.5%</td>
<td>-11.3%</td>
<td>-6.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;Cons
Durables</td>
<td>-0.7%</td>
<td>-2.4%</td>
<td>4.1%</td>
<td>3.7%</td>
<td>1.8%</td>
<td>5.4%</td>
<td>-22.7%</td>
<td>6.4%</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Cons
Non-Durable</td>
<td>5.4%</td>
<td>-2.2%</td>
<td>-5.0%</td>
<td>-8.2%</td>
<td>-4.2%</td>
<td>2.1%</td>
<td>-9.4%</td>
<td>-8.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Captial Gds</td>
<td>2.4%</td>
<td>0.5%</td>
<td>2.6%</td>
<td>24.7%</td>
<td>11.7%</td>
<td>6.7%</td>
<td>-24.5%</td>
<td>12.9%</td>
</tr>
<tr>
<td class="firstcol">Intermediate Gds</td>
<td>2.8%</td>
<td>-0.3%</td>
<td>2.3%</td>
<td>21.0%</td>
<td>10.0%</td>
<td>15.2%</td>
<td>-24.4%</td>
<td>4.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">All MFG-Sales</td>
<td>2.7%</td>
<td>-0.2%</td>
<td>1.2%</td>
<td>15.7%</td>
<td>7.6%</td>
<td>8.3%</td>
<td>-21.7%</td>
<td>5.3%</td>
</tr>
</tbody>
</table>
</body></html>

In March German orders spurted beyond expectations rising by 5% after being flat in February. Foreign orders built on a 1.7% gain in February rising by 4.7% in March. Domestic orders spurted by 5.4% coming off a 1.7% decline in [...]

German Orders Take A Strong Hold On Growth

USD/EUR exchange rate uncoupling from interest rate differential

Widespread downgrading of 2025 GDP outlook

Trade and fiscal policy uncertainty has exploded with the new administration

Much lower US electricity costs gives it a competitive advantage

Wage growth slowing in the US and Euro area; elevated and sticky in the UK

Stagflation-lite: Blue Chip forecasts below-trend growth and elevated inflation

US policy gyrations boosting policy uncertainty worldwide

Expected tariff hikes have boosted inflation expectations

US and Japan ended 2024 on solid ground in contrast to Europe

US economy expected to outperform other major economies in 2025

Only modest evidence of AI-related surge in US productivity growth

Previous Trump tariffs fading. A boost from new tariffs ahead?

Heavy US manufacturing states underperforming while Sun Belt states outperforming

Rising long-term yields a global phenomenon

US financial market concerns shifting from growth to inflation

Economic activity is picking up in the US but remains lackluster abroad

Policy uncertainty has surged since the US national elections.

Recent turnaround in US economic surprises leading to increases in rate-cut expectations

The outlook has brightened in the US, while it has dimmed for other major economies

Headline US PCE inflation elevated by sticky services prices

US and global equity prices have recently diverged

US leading global upturn in economic surprises

Blue Chip forecasters look for further significant monetary easing apart from Japan

Recent rise in global supply chain pressures could augur a pickup in global inflation pressures

Underperforming German economy generating increased policy uncertainty relative to Europe and the US

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Nonfarm payrolls increased 177,000 (1.2% y/y) during April after rising 185,000 in March, revised from 228,000, and 102,000 in February, revised from 117,000. Expectations had been for a 130,000 rise in the Action Economics Forecast Survey. The latest figure left the three-month average change at 155,000 in April, down from 232,000 in January.

Average hourly earnings rose 0.2% during April after unrevised increases of 0.3% in March and 0.2% in February. Earnings growth of 3.8% y/y was below the 5.9% high in March 2022.

The unemployment rate, measured in the household survey, held m/m at an expected 4.2% in April, and compared to 4.1% in February and 4.0% in January. It reached a low of 3.4% in April 2023. The unemployment rate, including employees working part-time for economic reasons plus all marginally-attached workers, eased to 7.8% in April from 7.9% in March.

The employment and earnings data are collected from surveys taken each month during the week containing the 12th day of the month. The labor market data are contained in Haver's **USECON** database. Detailed figures are in the **EMPL** and **LABOR** databases. The expectations figures are in the **AS1REPNA** database.

- Job growth spreads across most sectors.
- Earnings growth trend decelerates.
- Jobless rate holds steady.

U.S. Job Growth Is Firm in April but March Gain Is Lessened

Andrew Cates

**China-US shipping activity** 
The economic fallout from escalating US-China trade tensions is becoming increasingly visible in the data. A clear example is the chart below, which highlights a sharp drop in vessel arrivals at the ports of Los Angeles and Long Beach, along with a notable decline in ships waiting offshore. These trends point to a tangible weakening in bilateral trade flows, as the effects of tit-for-tat tariffs imposed by both countries begin to bite. Given the outsized role the US and China play in global commerce, this slowdown is likely to reverberate through global supply chains, weighing on trade volumes, dampening demand, and curbing economic growth worldwide.

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**GDP growth in Q1**
Data this week showed that the US economy contracted, albeit modestly, in Q1 even as the euro area recorded a modest expansion—an unusual divergence. The contraction in US GDP can be largely attributed to a sharp increase in imports, as firms rushed to front-load purchases ahead of anticipated tariff hikes. In addition, domestic demand was subdued, with weaker contributions from both consumer spending and government consumption. This decoupling between the US and euro area economies is particularly striking given the current global focus on the US dollar. While the euro area has shown unexpected signs of resilience, the US downturn raises important questions about its underlying momentum, especially as trade dynamics and policy uncertainty continue to cloud the outlook.

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**The US dollar versus yield differentials**
Chart 3 below illustrates a sharp breakdown in the correlation between the US-Germany 10-year yield differential and the EUR/USD exchange rate. Historically, the dollar has moved closely with interest rate spreads, as yield-seeking capital flowed into US assets. But since early 2025—and more acutely following the April tariff actions—the dollar has weakened markedly even as the yield spread has narrowed only modestly. This decoupling underscores a critical shift: capital markets are reacting not just to monetary policy, but to rising trade and geopolitical uncertainty. In other words, the exchange rate is now being driven as much by risk sentiment as by interest rate arbitrage.

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**The US economy’s structural outperformance and the dollar**
A second dynamic, captured in the next chart, reveals a tight correlation between the US real effective exchange rate and the potential GDP growth differential between the US and euro area over the past 50-60 years. This raises the question: has dollar strength (until recently) merely been a reflection of US growth leadership—or are capital inflows themselves helping to sustain this growth outperformance? In effect, the tail may be wagging the dog. Global investors have long allocated capital to the US, attracted by its macroeconomic resilience, technological leadership, and deep, liquid financial markets. The danger now is that the US trade war may disrupt this equilibrium. A sharp or sustained reduction in capital inflows could undermine growth, weaken the dollar, and trigger broader financial instability. Moreover, reversing this dynamic is not straightforward—barring a credible structural resurgence in European (or Asian) growth, the global investment landscape remains tilted toward the US.

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**US competitiveness versus Europe, China and Japan** 
The next chart below examines relative unit labour costs across major economies since 2011. The US and China have seen a broadly similar trajectory, with steady increases in relative cost structures, while the euro area has remained flat and Japan has seen dramatic improvement. This suggests that, from a cost competitiveness standpoint, the US is not uniquely disadvantaged vis-à-vis China. However, as we discuss further below, this parallel erosion of cost competitiveness is occurring at much higher nominal wage levels in the US, which blunts its ability to regain export share through tariff-related shifts alone. The trade war strategy—absent a corresponding improvement in productivity or structural reforms—risks imposing costs without delivering material competitiveness gains.

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**Average wages in selected developed and developing economies**
This point is reinforced by the final chart, which shows estimates for average monthly wages across countries in 2024. US labour remains much more expensive than in peer or emerging economies. So even if China’s costs rise in tandem with the US, the global supply chain has ample alternatives. 'China plus one' strategies are accelerating, and the US remains structurally misaligned with low-cost production hubs. Tariffs aimed at reshoring supply chains are unlikely to deliver sustained gains unless accompanied by deep supply-side reforms, and risk further disincentivizing foreign direct investment if global firms perceive US trade policy as erratic or punitive.

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Financial markets found a measure of calm this week, buoyed by some subtle shifts in tone from US policymakers. A softening in the administration’s rhetoric around trade tariffs coupled with a less confrontational stance toward Federal Reserve Chair Jerome Powell, helped ease tensions that had roiled markets earlier in the month. Equities rebounded modestly, and volatility indicators edged lower, reflecting cautious optimism that the worst of the policy shocks may be behind us. But beneath the surface, significant downside risks persist. New shipping data point to a pronounced slowdown in US-China trade flows (chart 1), suggesting the damage from recent tariff escalations is already rippling through global supply chains. Meanwhile, incoming data for the US revealed an unexpected contraction in the economy in Q1 and further signs of weakness in the labour market (chart 2). The US dollar, in the meantime, while long supported by superior growth and yield differentials, has begun to decouple from traditional drivers (charts 3 and 4) suggesting growing pressure on capital flows. At the same time, structural imbalances are drawing renewed scrutiny: unit labour cost comparisons show the US steadily losing competitiveness (chart 5), while nominal wage disparities remain stark versus China and other Asian economies, further complicating any effort to restore trade balance without broader reforms (chart 6). In short, while markets may be drawing temporary comfort from a pause in tariff brinkmanship, the deeper economic and financial vulnerabilities exposed this month remain unresolved—and increasingly central to the global macro narrative.

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Charts of the Week: Tariff Truce, Tenuous Trust

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U.S. light vehicle sales dropped 2.9% (+6.5% y/y) to 17.31 million units (SAAR) in April after surging 10.8% to 17.82 million units in March. The retreat in April vehicle sales accompanied a 1.7% y/y rise in real disposable income through March, which compared to 2.0% growth last year.

Sales declines were broad-based last month. Light truck sales fell 1.3% (+9.9% y/y) during April to 14.34 million units (SAAR), after rising 12.4% in March. Purchases of domestically-made light trucks declined 1.2% (+11.9% y/y) to 11.02 million units, after jumping 12.5% in March. Sales of imported light trucks fell 1.8% (+4.4% y/y) to 3.32 million units, following an 11.6% March surge.

Trucks’ record 82.8% share of the light vehicle market last month compared to 81.5% in March and 80.3% in April of last year. The share averaged 80.3% during all of 2024 versus 53.3% ten years earlier.

Auto sales also declined last month, down 9.5% (-7.5%) to 2.97 million units (SAAR) following a 3.5% March rise. The decline reversed all of the increase over the prior two months. Purchases of domestically-produced cars fell 9.8% (-4.3% y/y) last month to 2.22 million units, after rising 3.8% in March. Sales of imported autos declined 9.6% (-15.7% y/y) to 0.75 million units, following a 2.5% March increase.

Imports' 23.5% share of the U.S. light vehicle market was little changed from 23.6% in March and compared to a May 2023 low of 22.9% and a high of 26.3% in November of 2023. Imports' share of the passenger car market held steady at 25.3% last month and compared to 27.7% in April of last year. It reached a high of 38.7% in September 2021. Imports' share of the light truck market eased to 23.2% last month after falling to 23.3% in March.

U.S. vehicle sales figures can be found in Haver's **USECON** database. Additional detail by manufacturer is in the I**NDUSTRY** database.

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- Light truck sales pull back, while auto sales tumble.
- Both domestic and imported sales decline.
- Imports' market share slips further.

U.S. Light Vehicle Sales Fall in April

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The ISM Purchasing Managers Index of activity in the manufacturing sector slipped to 48.7 in April from 49.0 during March and 50.3 in February. It remained up from a low of 46.9 in October of last year. A level of 50 is the break-even point between a rising and falling level of activity. The Action Economics Forecast Survey expected a reading of 47.8 for April. The series reached a monthly high of 63.8 in March 2021.

Two of the five component indexes weakened last month. The April production index fell to 44.0 after declining to 48.3 in March. It was the lowest level since May 2020. A lessened 19.8% (NSA) of respondents reported higher production while an increased 24.2% reported lower output. The inventories index declined to 50.8 last month from 53.4 in March. The index remained up from a low of 43.2 in October of last year.

Moving higher, the new orders index rose to 47.2 last month from 45.2 in March. The index remained below a January high of 55.1. Twenty-eight percent (NSA) of respondents reported higher new orders while 26.7% reported a decline. The employment index rose to 46.5 from 44.7 in March. It was below a high of 50.3 in January. A greater 13.1% (NSA) of respondents reported more hiring while a fewer 16.2% indicated less. The supplier delivery index rose to 55.2 from 53.5 in March. A higher 16.6% (NSA) of respondents reported slower delivery speeds while a fairly steady 6.2% reported a quickening.

The prices index, which is not part of the composite series, edged up to 69.8 (NSA) in April after increasing to 69.4 in March. It was the highest level since June 2022, up from a December 2022 low of 39.4. An increased 49.2% of respondents reported higher prices last month, up from 12.2% in November, while a higher 9.7% reported lower prices.

In other series, the export orders index plummeted to 43.1 in April from 49.6 during March. It was down from the high of 52.4 in January. The imports index fell sharply to 47.1 from 50.1 in March. It was the lowest reading since December 2023. The order backlog index dropped to 43.7 (NSA) last month from 44.5 in March. It was the lowest level in five months.

The ISM figures are based on responses from over 400 purchasing executives from 18 industries, which are weighted according to each industry’s contribution to GDP. These indexes are diffusion indexes where a reading above 50 indicates expansion and a reading below 50 points to contraction. The figures from the Institute for Supply Management can be found in Haver’s **USECON** database; further detail is found in the **SURVEYS** database. The expectations number is available in Haver’s **AS1REPNA** database.

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- Declines in last three months follow earlier improvement.
- Production & inventories account for m/m shortfall.
- Prices index edges up to another three-year high.

U.S. ISM Manufacturing Index Indicates Contraction in April

Winnie Tapasanun

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The value of construction put in place unexpectedly fell 0.5% m/m in March after rises of 0.6% in February (+0.7% initially) and 0.1% in January (-0.5% previously), data from the U.S. Census Bureau showed. The March reading was the first m/m fall following five straight m/m gains. A 0.3% m/m March rise had been expected in the Action Economics Forecast Survey. The year-on-year rate of increase decelerated to 2.8% in March, the lowest since May 2019, after registering at 3.4% in February and January. The latest y/y figure was lower than 8.7% in March 2024; thus, having remained below its recent high of 9.8% in January 2024 and a peak of 18.6% in April 2022.

Private construction slid 0.6% (+2.3% y/y) in March, down for the first time since September, following increases of 0.7% in February (+0.9% initially) and 0.1% in January (-0.7% previously). Residential private construction fell 0.4% (+2.8% y/y) in March, the first m/m fall in six months, after an unrevised 1.3% gain in February. Home improvement building dropped 1.2% (+13.4% y/y), the first m/m decline since December, following a 2.3% February gain; it was 41.1% of the residential private construction. Single-family building edged up 0.1% (-0.8% y/y), the smallest of seven consecutive m/m increases, after a 0.8% February rise; it was 46.6% of the residential private construction. Meanwhile, multi-family building was essentially unchanged m/m (-12.1% y/y) in March following 15 straight m/m decreases; it was 12.3% of the residential private construction.

Nonresidential private construction fell 0.8% (+1.6% y/y) in March after a 0.1% increase in February (+0.4% initially) and a 0.1% easing in January (-0.2% previously). The March fall reflected m/m drops in the following nonresidential private constructions. These included religious (-2.9%; +16.4% y/y), health care (-2.2%; -5.2% y/y), office (-1.8%; +2.7% y/y), educational (-1.7%; -4.2% y/y), lodging (-1.6%; -1.0% y/y), commercial (-1.0%; -5.8% y/y), manufacturing (-0.4%; +3.6% y/y), communication (-0.3%; +2.2% y/y), and utilities (-0.1%; +7.0% y/y). In contrast, private constructions for amusement & recreation (1.5%; 7.0% y/y) and transportation (0.7%; 10.2% y/y) rose m/m in March.

The value of public construction declined 0.2% (+4.7% y/y) in March after holding steady in February (+0.2% initially), reflecting a 0.2% increase (-1.9% y/y) in residential public construction and a 0.2% easing (+4.8% y/y) in nonresidential public construction. The March decline reflected m/m drops in the following nonresidential public constructions. These included utilities (-4.8%; -12.8% y/y), commercial (-1.6%; +40.3% y/y), amusement & recreation (-1.0%; +19.1% y/y), educational (-0.6%; +7.6% y/y), sewage & waste disposal (-0.6%; +10.6% y/y), and health care (-0.4%; +13.0% y/y). Notably, spending on highways & streets, which made up 28.7% of public construction spending, fell 0.5% (-2.4% y/y) in March, the first m/m fall since October, following a 0.9% increase in February. To the upside, the following public constructions rose m/m in March: office (1.6%; 6.0% y/y), transportation (1.4%; 7.3% y/y), public safety (0.7%; 4.1% y/y), conservation & development (0.6%; 4.7% y/y), and water supply (0.6%; 12.2% y/y).

The construction figures can be found in Haver's **USECON** database. The expectations figure is from the Action Economics Forecast Survey in **AS1REPNA**.

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- March construction spending -0.5% m/m; +2.8% y/y, the lowest y/y rate since May ’19.
- Residential private construction -0.4% m/m, led by a 1.2% drop in home improvement building.
- Nonresidential private construction -0.8% m/m, down for the second month in three.
- Public sector construction -0.2% m/m, reflecting a 0.2% decline in nonresidential public building.

Economy in Brief: May 2010

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