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- Canada: Industrial Products & Raw Material Prices (Feb)
- Spain: Flash HICP and CPI, Construction Business Survey Press (Mar)
- Euro area: EC Business and Consumer Surveys (Mar)
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Economy in Brief
U.S. Initial Claims for Unemployment Insurance Ease
Initial jobless insurance applications fell to 258,000 (-3.1% y/y) during the week ended March 25...
U.S. Pending Home Sales Jump
The NAR reported that pending home sales increased 5.5% in February to an index level of 112.3...
U.S. Mortgage Loan Applications Remain Little Changed; Variable Rate Apps Surge
The MBA total Mortgage Market Volume Index slipped 0.8% last week (-12.4% y/y)...
La Dolce Vita? Italian Confidence Bumps Higher
Italian business and consumer confidence moved higher in March...
U.S. Consumer Confidence Improves Significantly
The Conference Board Consumer Confidence Index for March strengthened 8.2% (30.7% y/y) to 125.6...
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...
by Tom Moeller December 15, 2016
The Philadelphia Federal Reserve reported that its General Factory Sector Business Conditions Index jumped to 21.5 during December from November's 7.6. It was the highest level since November 2014. The reading for all of 2016 increased to 4.8, but remained below the 2010 high of 12.1. The latest monthly reading compared to expectations for 9.0 in the Action Economics Forecast Survey.
The ISM-Adjusted General Business Conditions Index, constructed by Haver Analytics eased to 53.8 this month, but remained near the two-year high. The ISM-Adjusted headline index is the average of five diffusion indexes: new orders, shipments, employment, supplier deliveries and inventories with equal weights (20% each). This figure is comparable to the ISM Composite Index. During the last ten years, there has been a 71% correlation between the adjusted Philadelphia Fed Index and real GDP growth.
There was mixed movement amongst the component series this month. New orders fell, but remained near the two-year high. Shipments, however, increased to a two-year high. Unfilled orders and delivery times improved, but inventories backpedaled to the lowest level in three months.
The employment component turned positive for the first time this year. It jumped to the highest level since May 2015. During the last ten years, there has been an 81% correlation between the jobs index and the m/m change in manufacturing sector payrolls. The average workweek reading jumped to the highest point since April 2011.
Prices paid strengthened to the highest level since July 2011. Prices received fell, but remained positive.
The future business activity index surged to the highest level since January of last year. The component series exhibited broad-based strength.
The survey panel consists of 150 manufacturing companies in Federal Reserve District III (consisting of southeastern PA, southern NJ and Delaware). The diffusion indexes represent the percentage of respondents indicating an increase minus the percentage indicating a decrease in activity. The ISM adjusted figure, calculated by Haver Analytics, is the average of five diffusion indexes: new orders, production, employment, supplier deliveries and inventories with equal weights (20% each). Each diffusion index is the sum of the percent responding "higher" and one-half of the percent responding "same."
The figures from the Philadelphia Federal Reserve can be found in Haver's SURVEYS database. The Action Economics figure is available in AS1REPNA.
|Philadelphia Fed - Manufacturing Business Outlook Survey (%, SA)||Dec||Nov||Oct||Dec'15||2016||2015||2014|
|General Factory Sector Business Conditions||21.5||7.6||9.7||-10.2||4.8||3.6||18.3|
|ISM-Adjusted Business Conditions||53.8||55.3||49.8||45.2||48.2||49.4||53.7|
|Number of Employees||6.4||-2.6||-4.0||2.2||-5.6||3.9||10.5|