North American Data Run-Down

January 19, 2012

U.S. inflation is benign.  Total U.S. consumer prices slid 0.4% at an annualized rate in the final quarter of 2011, cutting on-year inflation to 3.0% in December from 3.9% in September.  Core consumer prices increased 2.2% between end-2010 and end-2011.  That represents a slight acceleration from 1.8% between end-2009 and end-2010.  Core consumer prices, which exclude food and energy, rose 1.9% per annum in the decade between end-2001 and end-2011, down from 2.7% per annum in the prior ten years and 4.5% per annum between end-1981 and end-1991.

U.S. housing figures showed resilience considering the mountain of foreclosed properties still in the pipeline.  Building permits of 679K in December only gave back 0.1% after a 15.4% two-month jump between September and November.  Housing starts declined 4.1% last month but at 657K were still 11.6% greater than a year earlier.  The National Association of Home Builders reported that its index of builders’ confidence printed at 25 in January, 11 points better than September’s reading.  In spite of such good news, one has to reserve doubts if sustained improvement is here to stay.

The Philly Fed manufacturing index climbed a half-point in January to 7.3.  2011 figures underwent a benchmark revision that included a mark-down of December’s reading to 6.8 from 10.3 reported earlier.  A score of 7.3 is 30 points higher than last year’s revised low point of minus 22.7 in August but still low viewed from a broader historical perspective.  Readings in January and March of 2011 were 17.3 and 39.2.

A 50-point week-to-week drop in new U.S. jobless insurance claims near the cusp between 2011 and 2012 looks predictably fishy, but the underlying trend is encouraging.  New claims averaged 384.5K in the dozen week to January 14, down from 411K in the previous twelve weeks to October 22.  Many laid-off sixty-somethings gave up job searching and transitioned instead to collecting social security. 

Despite competitiveness pressures from an elevated Canadian dollar, manufacturing sales in Canada during November posted their fourth substantial monthly advance in five months.  The only exception was an 0.8% drop in October.  Sales in November were 10.2% higher than a year earlier.  Manufacturing sales increased between October and November by 2.0%, while new orders went up 3.6%.  Inflation-adjusted sales rose by 1.7%, and the ratio of inventories to nominal sales dipped to 1.31 from 1.33.

Copyright 2012, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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