Deeper Analysis

U.S. Manufacturing Edge Versus Euro Area Increased Last Month

February 1, 2019

The ISM-compiled U.S. manufacturing purchasing managers index rose 2.3 index points in January, while IHS-compiled counterpart fell 0.9 points. Consequently, the differential between these two data series, which had narrowed from 7.0 points in November to 2.9 index points in December, ballooned back to 6.1 points in January. This strong U.S. advantage exists in spite […] More

January 2019 in Figures

January 31, 2019

Equities rebounded sharply in January from their December slump, and the price of crude oil (West Texas Intermediate) soared 18.2%. There were no central bank policy rate changes among the major economies surveyed in this monthly feature, but the Federal Reserve signaled a shift from rate normalization to one of patience with no more increases […] More

Powell’s Press Conference

January 30, 2019

Fed Chairman Powell’s press conference reinforced the significant change in monetary policy forward guidance contained in the formal statement released today by the Federal Open Market Committee. He declined to agree that the current hold on further near-term changes in the federal funds target is merely a “pause in a tightening cycle,” conceding instead that […] More

The Next U.S. Recession

January 22, 2019

I can’t recall any U.S. President, Treasury Secretary, or Fed Chairman predicting a recession prior to its onset. For that matter, financial advisers tend to avoid the R-word until its partly in the rear-view mirror, and conventional wisdom all around usually doesn’t identify a recession until it’s underway. Because of this phobia against shouting that […] More

U.S. Non-Manufacturing PMI and Euroland’s Service-Sector PMI Fell in December But Not Below a 50 Reading

January 7, 2019

The ISM’s non-manufacturing U.S. purchasing managers index declined 3.1 points in December to a 5-month low of 57.6. This slowdown in positive growth was led by lessening production/sales, whose subindex retraced 5.3 points. The report also revealed slower employment conditions and less inflation intensity. The IHS service sector PMI fell by 2.2 points last month […] More

Growth in U.S. Manufacturing Slowed Sharply Last Month Both Absolutely and Relative to Euroland Counterpart

January 3, 2019

In contrast to November when the ISM-compiled U.S. purchasing managers index exceeded the IHS-compiled PMI for the euro area by the widest margin in four years, that differential in December narrowed by 4.8 index points in December to an 8-month low of 2.7 points. The U.S. index dropped 5.2 points to a 25-month low of […] More

December and 2017 in Figures

January 1, 2019

Ten-year sovereign debt yields fell last month, resulting in end-2017 to end-2018 declines in Germany, Switzerland, Canada and Japan but end of year to end of year increases in both the United States and Great Britain. The Fed tightened its fed funds target rate four times by a total of one full percentage point last […] More

Trump and the U.S. Stock Market

December 24, 2018

Earlier in his presidency, Donald Trump would frequently cite rising U.S. share prices as a vote of confidence in his leadership and economic policies. However, less than two years into his term, the Nasdaq and S&P 500 have entered bear market territory, and the Dow Jones Industrials, with a 19.1% slide from peak, is knocking […] More

U.S. PMI Readings Improved Last Month Relative to Euroland’s

December 6, 2018

The ISM-compiled U.S. non-manufacturing PMI rebounded 0.4 points to a reading in November of 60.7. That still reflects rapidly improved conditions. Sub-indices for production, orders and prices climbed by 2.7, 1.0 and 2.6 points between October and last month, but the measure of employment declined 1.3 points. The IHS-compiled service sector purchasing managers index for […] More

Spread Between U.S. and Ezone Manufacturing PMIs at a 4-Year High

December 3, 2018

The point differential between the ISM-compiled U.S. manufacturing PMI and the IHS-compiled Euroland manufacturing purchasing managers index widened 1.8 points in November to 7.5, its greatest width since a similar spread in November 2014. This more sizable U.S. advantage happened in spite of a pricier dollar. With a large export-derived base, manufacturing prosperity┬átends to ebb […] More