Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Coronavirus Infection Spread and Deaths Forecast 2020 - Video - 28th Jan 20
Is an Accommodative Fed Bullish for the Stock Market? - 28th Jan 20
Trillion-Dollar Stock Market Cap Club - 28th Jan 20
Corona Virus Wuhan Global Pandemic 2020 Deaths Forecast and Market Consequences - 28th Jan 20
Palladium Surges above $2,400. Is It Sustainable? - 27th Jan 20
THIS ONE THING Will Tell Us When the Bubble Economy Is Bursting… - 27th Jan 20
Stock Market, Gold Black Swan Event Begins - 27th Jan 20
This Will Signal A Massive Gold Stocks Rally - 27th Jan 20
US Presidential Cycle Stock Market Trend Forecast 2020 - 27th Jan 20
Stock Market Correction Review - 26th Jan 20
The Wuhan Wipeout – Could It Happen? - 26th Jan 20
JOHNSON & JOHNSON (JNJ) Big Pharama AI Mega-trend Investing 2020 - 25th Jan 20
Experts See Opportunity in Ratios of Gold to Silver and Platinum - 25th Jan 20
Gold/Silver Ratio, SPX, Yield Curve and a Story to Tell - 25th Jan 20
Germany Starts War on Gold  - 25th Jan 20
Gold Mining Stocks Valuations - 25th Jan 20
Three Upside and One Downside Risk for Gold - 25th Jan 20
A Lesson About Gold – How Bullish Can It Be? - 24th Jan 20
Stock Market January 2018 Repeats in 2020 – Yikes! - 24th Jan 20
Gold Report from the Two Besieged Cities - 24th Jan 20
Stock Market Elliott Waves Trend Forecast 2020 - Video - 24th Jan 20
AMD Multi-cores vs INTEL Turbo Cores - Best Gaming CPUs 2020 - 3900x, 3950x, 9900K, or 9900KS - 24th Jan 20
Choosing the Best Garage Floor Containment Mats - 23rd Jan 20
Understanding the Benefits of Cannabis Tea - 23rd Jan 20
The Next Catalyst for Gold - 23rd Jan 20
5 Cyber-security considerations for 2020 - 23rd Jan 20
Car insurance: what the latest modifications could mean for your premiums - 23rd Jan 20
Junior Gold Mining Stocks Setting Up For Another Rally - 22nd Jan 20
Debt the Only 'Bubble' That Counts, Buy Gold and Silver! - 22nd Jan 20
AMAZON (AMZN) - Primary AI Tech Stock Investing 2020 and Beyond - Video - 21st Jan 20
What Do Fresh U.S. Economic Reports Imply for Gold? - 21st Jan 20
Corporate Earnings Setup Rally To Stock Market Peak - 21st Jan 20
Gold Price Trend Forecast 2020 - Part1 - 21st Jan 20
How to Write a Good Finance College Essay  - 21st Jan 20
Risks to Global Economy is Balanced: Stock Market upside limited short term - 20th Jan 20
How Digital Technology is Changing the Sports Betting Industry - 20th Jan 20
Is CEOs Reputation Management Essential? All You Must Know - 20th Jan 20
APPLE (AAPL) AI Tech Stocks Investing 2020 - 20th Jan 20
FOMO or FOPA or Au? - 20th Jan 20
Stock Market SP500 Kitchin Cycle Review - 20th Jan 20
Why Intel i7-4790k Devils Canyon CPU is STILL GOOD in 2020! - 20th Jan 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

ISM Manufacturing Survey Shows Continuing Sluggish U.S. Economic Recovery

Economics / Economic Recovery Nov 02, 2010 - 04:59 AM GMT

By: Asha_Bangalore


Best Financial Markets Analysis ArticleThe ISM composite index of the manufacturing sector rose to 56.9 in October, the highest since May 2010.  The headline and details indicate that the factory sector is back on its feet after a sluggish performance in the third quarter.  The index tracking new orders, a forward looking indicator, increased to 58.9 in October vs. 51.1 in the prior month. 

The exports orders index also posted a strong increase of six points to 60.5 in October.  The import index fell to 51.5 from 56.5 in September.  If the export index continues to advance in the months ahead, it would be consistent with expectations of a positive contribution to real GDP growth. 

The index tracking prices has risen from 57.0 in May to 71.0 in October, largely a reflection of higher commodity prices.  Respondents indicated that a weak dollar has resulted in higher prices of commodities and reduction of margins.  This concern has another aspect to bear in mind because exporters are likely to gain from a weak dollar.  The overall tone of the report is positive because in addition to an increase in indexes of new orders and exports, indexes tracking production and employment also advanced (see table below) during October. 

Consumer Spending Shows Only a Mild Gain, Personal Income Inches Down, Inflation Remains Subdued

Personal income fell 0.1% in September after a 0.4% gain in the prior month, while wages and salaries held steady.  Real consumer spending grew only 0.1% in September following a 0.3% gain in the prior month.  The tepid readings of consumer spending and income are consistent with the third quarter headline GDP.  Going forward, robust hiring holds the key to stronger growth in consumer spending.  The saving rate of the U.S. economy edged down to 5.3% in September vs. 5.6% in the prior month.  In the first nine months of the year, the saving rate averaged 5.6% vs. 6.1% in the same period during 2009.

The personal consumption expenditure price index barely budged in September (+0.08%), putting the year to year increase at 1.36%.  The core personal consumption expenditure price index, which excludes food and energy, held steady (+0.04%) during September, with the year-to-year gain at 1.36%.  These readings are below the Fed's preference of inflation data.  The Fed's policy statement on November 4 should spell out the details of the much anticipated second round of quantitative easing. 

Asha Bangalore — Senior Vice President and Economist
Asha Bangalore is Vice President and Economist at The Northern Trust Company, Chicago. Prior to joining the bank in 1994, she was Consultant to savings and loan institutions and commercial banks at Financial & Economic Strategies Corporation, Chicago.

The opinions expressed herein are those of the author and do not necessarily represent the views of The Northern Trust Company. The Northern Trust Company does not warrant the accuracy or completeness of information contained herein, such information is subject to change and is not intended to influence your investment decisions.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules