Thursday October 08 2015
Fed Shows Concerns Over Global Economy
Federal Reserve | Joana Taborda | email@example.com
Federal Reserve policymakers worried recent global and financial market developments might restrain economic activity in the US. Although their outlook had not materially altered, the committee decided to wait for additional information confirming it had not deteriorated before raising rates, minutes of the meeting held last month showed.
Extracts From the Minutes of the Federal Open Market Committee:
In their discussion of monetary policy for the period ahead, members judged that information received since the FOMC met in July indicated that economic activity was expanding at a moderate pace. Although net exports remained soft, economic growth was broadly based. Members noted that recent global and financial market developments might restrain economic activity somewhat as a result of the higher level of the dollar and possible effects of slower economic growth in China and in a number of emerging market and commodity-producing economies. Nevertheless, they still viewed the risks to U.S. economic activity as nearly balanced, and they continued to expect that, with appropriate policy accommodation, economic activity would most likely continue to expand at a moderate pace.
In assessing whether economic conditions had improved sufficiently to initiate a firming in the stance of policy, many members said that the improvement in labor market conditions met or would soon meet one of the Committee's criteria for beginning policy normalization. But some indicated that their confidence that inflation would gradually return to the Committee's 2 percent objective over the medium term had not increased, in large part because recent global economic and financial developments had imparted some restraint to the economic outlook and placed further downward pressure on inflation in the near term. Most members agreed that their confidence that inflation would move to the Committee's inflation objective would increase if, as expected, economic activity continued to expand at a moderate rate and labor market conditions improved further. Many expected those conditions to be met later this year, although several members were concerned about downside risks to the outlook for real activity and inflation.
After assessing the outlook for economic activity, the labor market, and inflation and weighing the uncertainties associated with the outlook, all but one member concluded that, although the U.S. economy had strengthened and labor underutilization had diminished, economic conditions did not warrant an increase in the target range for the federal funds rate at this meeting. They agreed that developments over the intermeeting period had not materially altered the Committee's economic outlook. Nevertheless, in part because of the risks to the outlook for economic activity and inflation, the Committee decided that it was prudent to wait for additional information confirming that the economic outlook had not deteriorated and bolstering members' confidence that inflation would gradually move up toward 2 percent over the medium term. One member, however, preferred to raise the target range for the federal funds rate at this meeting, indicating that the current low level of real interest rates was not appropriate in the context of current economic conditions.
The Committee agreed to maintain the target range for the federal funds rate at 0 to 1/4 percent and to reaffirm in its postmeeting statement that the Committee's decision about how long to maintain the current target range for the federal funds rate would depend on its assessment of actual and expected progress toward its objectives of maximum employment and 2 percent inflation. Members agreed that the Committee's evaluation of progress on its objectives would take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.
Thursday October 08 2015
US Jobless Claims at 3-Month Low
DOL | Joana Taborda | firstname.lastname@example.org
The number of Americans filing for unemployment benefits was 263,000 in the week ended October 3rd, a decrease of 13,000 from the previous week. It is the lowest figure since mid-July.
The previous week's level was revised down by 1,000 from 277,000 to 276,000.
Claims stayed below 300,000 for the 31th straight week and 4-week moving average decreased further by 3,000 to 267,500. The previous week's average was revised down by 250 from 270,750 to 270,500.
The advance seasonally adjusted insured unemployment rate was 1.6 percent for the week ending September 26, unchanged from the previous week's unrevised rate.
The number of people continuing to receive jobless benefits (advance number for seasonally adjusted insured unemployment) during the week ending September 26 was 2,204,000, an increase of 9,000 from the previous week's revised level. The previous week's level was revised up 4,000 from 2,191,000 to 2,195,000. The 4-week moving average was 2,221,500, a decrease of 14,750 from the previous week's revised average. The previous week's average was revised up by 1,000 from 2,235,250 to 2,236,250.
Tuesday October 06 2015
US Trade Deficit Widens in August
The Commerce Department | Joana Taborda | email@example.com
US trade gap increased to USD 48.33 billion in August of 2015, from a slightly downwardly revised USD 41.8 billion in July, reaching the highest in five months. Exports fell nearly 2 percent to its lowest since October of 2012, dragged down by a strong dollar and weak external demand while imports rose 1.2 percent boosted by higher demand for consumer goods.
Total exports decreased USD 3.7 billion to USD 185.09 billion. Exports of goods decreased USD 4.1 billion to USD 124.5 billion: industrial supplies and materials decreased USD 2.2 billion; fuel oil decreased USD 0.6 billion; plastic materials decreased USD 0.2 billion and crude oil decreased USD 0.2 billion. In contrast, exports of services increased USD 0.4 billion to USD 60.6 billion, led by financial services (increased USD 0.1 billion) and travel (for all purposes including education - increased USD 0.1 billion).
Total imports rose USD 2.8 billion to USD 233.42 billion. Imports of goods increased USD 2.5 billion to USD 192.4 billion: consumer goods increased USD 4.0 billion; cell phones and other household goods increased USD 2.1 billion; toys, games and sporting goods increased USD 0.3 billion. Imports of services increased USD 0.3 billion to USD 41.1 billion in August, due to travel (for all purposes including education - increased USD 0.2 billion) and transport, which includes freight and port services and passenger fares (increased USD 0.1 billion).
Among trading partners, sales to Mexico fell by USD 1.5 billion and those to the European Union decreased USD 0.5 billion and imports from China rose 3 percent.
Monday October 05 2015
US Services Sector Growth Slows
ISM | Joana Taborda | firstname.lastname@example.org
The ISM Non-Manufacturing PMI index registered 56.9 percent in September of 2015, down from 59 in August and below market expectations. It was the weakest growth in the services sector since June as business activity, new orders and prices decreased while job creation went up.
The Non-Manufacturing Business Activity Index decreased to 60.2 percent, which is 3.7 percentage points lower than the August reading of 63.9 percent, reflecting growth for the 74th consecutive month at a slower rate.
The New Orders Index registered 56.7 percent, 6.7 percentage points lower than the reading of 63.4 percent in August.
The Employment Index increased 2.3 percentage points to 58.3 percent from the August reading of 56 percent and indicates growth for the 19th consecutive month.
The Prices Index decreased 2.4 percentage points from the August reading of 50.8 percent to 48.4 percent, indicating prices decreased in September for the first time since February of this year.
13 non-manufacturing industries reported growth in September. There has been a cooling off in the rate of growth during the month of September. Also, the trend of lower costs and little pricing power continues as reflected in the contraction of the pricing index. Overall, respondents continue to remain positive about current business conditions.
Friday October 02 2015
US Economy Adds Only 142K Jobs In September
Bureau of Labor Statistics | Joana Taborda | email@example.com
American payrolls increased by 142,000 in September, well below market expectations while the unemployment rate was unchanged at 5.1 percent, matching forecasts. Job gains occurred in health care and information, while mining employment fell. Thus far in 2015, job growth has averaged 198,000 per month, compared with an average monthly gain of 260,000 in 2014.
Figures for August and July were revised downwards to 136 thousand and 223 thousand respectively.
Health care added 34,000 jobs in September, in line with the average increase of 38,000 jobs per month over the prior 12 months. Hospitals accounted for 16,000 of the jobs gained in September, and employment in ambulatory health care services continued to trend up (+13,000).
Employment in information increased by 12,000 in September and has increased by 44,000 over the year.
Employment in professional and business services continued to trend up in September (+31,000). Job growth has averaged 45,000 per month thus far in 2015, compared with an average monthly gain of 59,000 in 2014. In September, job gains occurred in computer systems design and related services (+7,000) and in legal services (+5,000).
Retail trade employment trended up in September (+24,000), in line with its average monthly gain over the prior 12 months (+27,000). In September, employment rose in general merchandise stores (+10,000) and automobile dealers (+5,000).
Employment in food services and drinking places continued on an upward trend in September (+21,000). Over the year, this industry has added 349,000 jobs.
Employment in mining continued to decline in September (-10,000), with losses concentrated in support activities for mining (-7,000). Mining employment has declined by 102,000 since reaching a peak in December 2014.
Employment in other major industries, including construction, manufacturing, wholesale trade, transportation and warehousing, financial activities, and government, showed little or no change over the month.
The average workweek for all employees on private nonfarm payrolls declined by 0.1 hour to 34.5 hours in September. The manufacturing workweek decreased by 0.2 hour to 40.6 hours, and factory overtime declined by 0.2 hour to 3.1 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls decreased by 0.1 hour to 33.6 hours.
In September, average hourly earnings for all employees on private nonfarm payrolls, at $25.09, changed little (-1 cent), following a 9-cent gain in August. Hourly earnings have risen by 2.2 percent over the year. Average hourly earnings of private-sector production and nonsupervisory employees were unchanged at $21.08 in September.
Friday October 02 2015
US Unemployment Rate Steady at 5.1%
BLS | Joana Ferreira | firstname.lastname@example.org
Jobless rate in the US was unchanged at 5.1 percent and total nonfarm payroll employment increased by 142,000 in September. Job gains occurred in health care and information, while mining employment fell.
In September, the unemployment rate held at 5.1 percent, and the number of unemployed persons (7.9 million) changed little. Over the year, the unemployment rate and the number of unemployed persons were down by 0.8 percentage point and 1.3 million, respectively.
Among the major worker groups, the unemployment rates for adult men (4.7 percent), adult women (4.6 percent), teenagers (16.3 percent), whites (4.4 percent), blacks (9.2 percent), Asians (3.6 percent), and Hispanics (6.4 percent) showed little or no change in September.
The number of persons unemployed for less than 5 weeks increased by 268,000 to 2.4 million in September, partially offsetting a decline in August. The number of long-term unemployed (those jobless for 27 weeks or more) was little changed at 2.1 million in September and accounted for 26.6 percent of the unemployed.
The civilian labor force participation rate declined to 62.4 percent in September; the rate had been 62.6 percent for the prior 3 months. The employment-population ratio edged down to 59.2 percent in September, after showing little movement for the first 8 months of the year.
The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) declined by 447,000 to 6.0 million in September. These individuals, who would have preferred full-time employment, were working part time because their hours had been cut back or because they were unable to find a full-time job. Over the past 12 months, the number of persons employed part time for economic reasons declined by 1.0 million.
In September, 1.9 million persons were marginally attached to the labor force, down by 305,000 from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.
Among the marginally attached, there were 635,000 discouraged workers in September, little changed from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.3 million persons marginally attached to the labor force in September had not searched for work for reasons such as school attendance or family responsibilities.
Thursday October 01 2015
US Factory Activity Remains The Weakest Since May 2013
ISM | email@example.com
The Institute for Supply Management’s Manufacturing PMI decreased to 50.2, the third straight drop from 51.1 the prior month as a stronger dollar and lower demand from oversees led to the slowest pace of orders since November 2012.
The New Orders Index registered 50.1 percent, a decrease of 1.6 percentage points from the reading of 51.7 percent in August. The Production Index registered 51.8 percent, 1.8 percentage points below the August reading of 53.6 percent. The Employment Index registered 50.5 percent, 0.7 percentage point below the August reading of 51.2 percent. Backlog of Orders registered 41.5 percent, a decrease of 5 percentage points from the August reading of 46.5 percent. The Prices Index registered 38 percent, a decrease of 1 percentage point from the August reading of 39 percent, indicating lower raw materials prices for the 11th consecutive month. The New Export Orders Index registered 46.5 percent, the same reading as in August. Comments from the panel are mixed with some concern about the global economy and customer confidence."
Of the 18 manufacturing industries, seven are reporting growth in September in the following order: Printing & Related Support Activities; Textile Mills; Furniture & Related Products; Food, Beverage & Tobacco Products; Miscellaneous Manufacturing; Paper Products; and Nonmetallic Mineral Products. The 11 industries reporting contraction in September — listed in order — are: Primary Metals; Apparel, Leather & Allied Products; Petroleum & Coal Products; Wood Products; Electrical Equipment, Appliances & Components; Machinery; Computer & Electronic Products; Fabricated Metal Products; Plastics & Rubber Products; Transportation Equipment; and Chemical Products.
Thursday October 01 2015
Markit Manufacturing PMI Rises Slightly in September
Markit | firstname.lastname@example.org
U.S. Manufacturing Purchasing Managers' Index rose slightly to 53.1 in September from 53.0 in August, which marked the lowest level since October 2013. The September level was also up from a preliminary reading of 53.0.
Both output and new business volumes continued to expand at slower rates than those seen earlier in 2015, which contributed to a marked slowdown in job creation during the latest survey period. A renewed fall in input prices provided support to operating margins in September. That said, factory gate charges were unchanged over the month, which ended a three-year period of sustained output price inflation, Markit said.
The employment subindex fell to 50.8 in September from 52.4 in August, the lowest level since June 2013. Output rose to 54.5 after hitting 53.8 in August, its lowest level since January 2014.
Thursday October 01 2015
US Jobless Claims at 4-Week High
DOL | Joana Taborda | email@example.com
The number of Americans filling for unemployment benefits was 277,000 in the week ended September 26th, an increase of 10,000 from the previous week's level of 267,000. However, claims stayed below 300,000 for the 30th straight week, 4-week moving average decreased and continuing claims were at the lowest since November of 2000, pointing to labour market strength.
The 4-week moving average was 270,750, a decrease of 1,000 from the previous week's unrevised average of 271,750.
The advance seasonally adjusted insured unemployment rate was 1.6 percent for the week ending September 19, a decrease of 0.1 percentage point from the previous week's unrevised rate.
The advance number for seasonally adjusted insured unemployment during the week ending September 19 was 2,191,000, a decrease of 53,000 from the previous week's revised level. This is the lowest level for insured unemployment since November 11, 2000 when it was 2,161,000. The previous week's level was revised up 2,000 from 2,242,000 to 2,244,000.
The 4-week moving average was 2,235,250, a decrease of 17,000 from the previous week's revised average. The previous week's average was revised up by 500 from 2,251,750 to 2,252,250.
Monday September 28 2015
US Personal Spending Above Forecasts
U.S. Bureau of Economic Analysis | Joana Taborda | firstname.lastname@example.org
Personal consumption in the US went up 0.4 percent in August of 2015, the same as in July and beating market expectations. It is the seventh consecutive month of spending growth. Income rose 0.3 percent, the smallest gain in five months.
Consumer spending which accounts for more than two-thirds of U.S. GDP was previously reported to have advanced 0.3 percent in July.
Personal income increased $52.5 billion or 0.3 percent, and disposable personal income (DPI) increased $47.1 billion, or 0.4 percent, in August. In July, personal income increased $69.6 billion, or 0.5 percent, DPI increased $63.9 billion, or 0.5 percent, and PCE increased $45.7 billion, or 0.4 percent, based on revised estimates.
Wages and salaries increased $35.6 billion in August, compared with an increase of $43.8 billion in July. Private wages and salaries increased $31.5 billion, compared with an increase of $40.0 billion. Government wages and salaries increased $4.1 billion, compared with an increase of $3.8 billion.
The price index for PCE increased less than 0.1 percent in August, compared with an increase of 0.1 percent in July. The PCE price index, excluding food and energy, increased 0.1 percent in August, the same as in July.