Deeper Analysis

Strong Factory Growth in Both the U.S. and Euroland

July 3, 2017

In June, U.S. manufacturing overcame a disadvantage relative the the euro area in a single month, as the euro advanced to its strongest monthly average in a year against the dollar. The U.S. Institute of Supply Management reported a 2.9-point increase in the manufacturing purchasing managers index to 57.8, signifying the strongest rate of improvement […] More

June and the Second Quarter in Figures

July 1, 2017

As in the previous quarter, a slide in the price of oil was a key development during the second quarter, and half of this move occurred in June. Gold also lost value both in June and the whole quarter. A second theme of the period was a shifting view about future monetary policies in the […] More

Comment on Revised U.S. GDP Figures

June 29, 2017

According to revised figures, real GDP expanded 1.4% at an annualized rate between the last quarter of 2016 and the first quarter of 2017. The initial estimate of 0.7% was revised a month ago to 1.2%. Personal consumption (up 1.1% annualized), non-residential business investment (10.4%) and residential construction (13.0%) collectively augmented real GDP growth by […] More

U.S. Non-Manufacturing PMI and Ezone Services PMI Compared

June 5, 2017

The 0.6-point difference in May between the ISM non-manufacturing purchasing managers index (56.9) and the euro zone services PMI compiled by IHS Markit (56.3) was 0.5 points smaller than in April. IHS Markit also measures a U.S. services PMI, and this rose by 0.5 points to 53.6. As was the case with the two economies’ […] More

Marginally Faster Manufacturing Activity in the U.S. and Euroland

June 1, 2017

In May, the U.S. manufacturing purchasing managers index edged 0.1 point higher to 54.9, while Euroland’s PMI gained 0.3 points to 57.0. Both results imply robust expansion. Euroland’s advantage, represented by the difference between the U.S. and Ezone scores widened by 0.2 points to -2.1 points, which as seen in the column labeled “spread” below […] More

May in Figures

June 1, 2017

U.S. and European sovereign debt yields fell during May. Short-term European interest rates also fell in contrast to a rise of the 3-month U.S. deposit rate. In Japan, rates rose at the long end but fell in short maturities. Stock markets improved in all markets examined here except Canada’s. The dollar climbed against sterling and […] More

Some Revealing Excerpts from May 2-3 FOMC Minutes

May 24, 2017

The excerpts below lend credence to rising expectations that the federal funds rate target will undergo its fourth increase at the June meeting. At the same time, great emphasis is placed on ensuring that rate normalization proceed at a gradual pace. The same feeling surrounds balance sheet reduction, which also will proceed at a very […] More

Bari Statement of G7 Finance Ministers and Central Bank Governors

May 14, 2017

Group of Seven finance ministers and central bank chiefs released a five-page statement following their two days of talks in Bari, Italy. The meeting was a preamble to the summit of G7 leaders later this month in Sicily. It will be the first one attended by President Trump, and the broad waves he has been […] More

U.S. Non-Manfacturing PMI and Ezone Services PMI

May 4, 2017

The U.S. non-manufacturing purchasing managers index rose 2.3 points to 57.5 in April, signifying a robust expansion whose rate of growth accelerated significantly that month. Production (up 3.5 to 62.4), orders (up 4.3 to 63.2) and prices (up 4.1 to 57.6) each expanded much more quickly than in March, while jobs continued to grow slowly. […] More

Soft Euro Lifting Euroland Manufacturing at U.S. Expense

May 2, 2017

The manufacturing purchasing managers index of Euroland, 56.7, surpassed its U.S. counterpart, 54.8, in April for the first time since April. The lagged effect of the post-Trump dollar rally is a major reason why. Manufacturing is more sensitive to currency movement than non-manufacturing. Although the table below uses the ISM compilation for its U.S. component […] More