- Sweden: Consumer Confidence, Business Tendency Survey, Public Finance (Mar)
- Spain: Mortgage Market (Jan), Order Book Forecast (Mar)
- Italy: ISTAT Business & Consumer Survey Press Release (Mar)
- Germany: Business Registrations & Deregistrations (Dec), Import & Export Prices (Feb), IAB Labor Market Barometer (Mar)
- Vietnam: GDP (Q1), CPI, IP, International Trade, Passenger & Cargo Traffic Statistics, Manufacturing Sales and Inventories, International Visitor Arrivals (Mar); Korea: Economic Sentiment
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Economy in Brief
U.S. Energy Product Prices Remain Under Pressure
Regular gasoline prices held steady at $2.32 per gallon last week (12.1% y/y) for the third straight week...
German Federal Debt Levels Fall
German debt level fell outright in Q4 2016 as the ratio of federal debt-to-GDP also fell...
NABE 2018 Forecast: Modest Improvement in Economic Growth & Higher Inflation
The NABE expects 2.5% real U.S. economic growth in 2018 compared to 2.3% forecast for 2017...
Texas Factory Sector Activity Remains Strong
The Dallas Fed indicated in its Texas Manufacturing Outlook Survey that the General Business Activity Index eased during March...
EMU Money and Credit Growth Are Less Than Impressive Than Euro-PMIs
EMU nominal money supply growth is slightly higher over three months, but credit growth in the EMU is slower...
Durable Goods Orders Strengthened by Another Jump in Aircraft
New orders for durable goods rose 1.7% (5.0% y/y) during February...
by Tom Moeller June 13, 2016
Improvement in factory sector output continues to support pricing power in the industrial sector. The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) increased 0.7% during the last four weeks, and 5.8% during the last three months. Despite these gains, however, prices remained 4.2% lower versus one year ago as worldwide factory output remained under pressure.
Within the sector groupings of prices, the FIBER indexes showed increases in several categories. Prices were strongest in the crude oil & benzene area. The cost of WTI crude oil jumped 10.6% m/m to $49.96 per barrel, but remained down 16.8% y/y. Prices for the petro-chemical benzene were little changed last month but were off 18.0% y/y. Within the metals sector, pricing strength remained uneven. Steel scrap prices increased 13.0% recently, and were up 6.5% versus last year. Other metals prices remained under pressure with aluminum prices fairly steady last month but 8.5% lower than last year. Copper scrap prices moved 2.7% lower m/m, and were down roughly one quarter versus last year. In the textile group, cotton prices jumped 7.1% last month and were 1.5% higher versus last year. Down by 1.6% m/m were burlap prices, though they've risen 7.9% y/y. In the miscellaneous group, home building improvement raised framing lumber prices 0.6% last month and by 13.8% during the last six months. Prices for structural panels also gained 1.6% m/m, and by the same 1.6% y/y. Natural rubber prices declined 15.2% last month and they're down 15.3% y/y.
Over the near term, there may not be much support coming for commodity prices. The current industrial output projection from the National Association for Business Economics (NABE) calls for a 0.6% decline in industrial production in 2016. That is reduced from the earlier expectation of a 2.2% rise. The pricing environment may improve next year. In 2017 factory output is expected to rebound 2.2%. During the last ten years, there has been a 52% correlation between the three-month change in prices and the change in industrial output.
Commodity price data can be found in Haver's DAILY, WEEKLY, USECON and CMDTY databases. The NABE forecast is in the SURVEYS database.
|FIBER Industrial Materials Price Index (1990=100)||1-Mth %||3-Mth %||6-Mth %||12-Mth %||2015 %||2014 %||2013 %|
|Cotton (cents per pound)||7.1||14.4||0.7||1.5||2.6||-24.2||10.8|
|Aluminum ($ per metric ton)||0.2||-1.1||5.1||-8.5||-19.2||9.4||-15.8|
|Copper Scrap (cents per pound)||-2.7||-6.6||0.6||-22.4||-27.0||-12.0||-6.8|
|Steel Scrap ($ per ton)||13.0||49.1||76.4||6.5||-53.8||-18.6||8.4|
|Crude Oil & Benzene||3.8||11.0||8.7||-10.2||-19.4||-26.5||0.8|
|Crude Oil (WTI, $ per Barrel)||10.6||33.3||32.1||-16.8||-35.8||-43.2||10.3|
|Framing Lumber ($ per 1000 board ft.)||0.6||12.3||13.8||10.2||-16.4||-1.6||3.5|
|Natural Rubber (cents per pound)||-15.2||3.3||17.2||-15.3||-22.5||-32.3||-9.8|