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The Empire State Manufacturing Survey produced a January reading of 19.5, well above analyst expectations for a 15 and indicative that business conditions improved significantly. January's reading was 13.48.
Manufacturing in the New York region expanded in February at the fastest pace since June 2010, a sign factories are propelling the expansion.
The Federal Reserve Bank of New York’s general economic index increased to 19.5 this month from 13.5 in January. The index exceeded all forecasts in a Bloomberg News survey of economists. Readings greater than zero signal expansion in the so-called Empire State Index, which covers New York, northern New Jersey, and southern Connecticut.
Investment in new equipment and inventory restocking this quarter will help keep American factories expanding even as slower global growth limits exports. A pickup in job creation that helps drive bigger gains in consumer spending may further fuel production.
“Given all that’s going on in the world, manufacturing is pretty healthy,” Paul Ashworth, chief U.S. economist at Capital Economics Ltd. in Toronto, said before the report. “We’ve seen a pretty marked turnaround in manufacturing.”
The median projection in the Bloomberg survey of 56 economists called for a gain to 15. Estimates ranged from 10 to 18.
Production at U.S. factories increased in January, reflecting gains in demand for U.S.-made automobiles and business equipment that may keep manufacturing at the forefront of the expansion.
Output at factories rose 0.7 percent after a revised 1.5 percent gain in December that was the largest in five years, figures from the Federal Reserve showed today in Washington. A 2.5 percent decline in utility output prompted by the fourth- warmest January on record caused total industrial output to be little changed, less than forecast.
Business investment in new equipment and the need to rebuild inventories will probably keep factory assembly lines rolling at the start in 2012. Nonetheless, Europe’s financial crisis and slowing growth in emerging economies like China threaten to temper orders for U.S. goods.
“We are in the middle of inventory rebuilding, and consumer demand for autos has picked up,” Julia Coronado, chief economist for North America at BNP Paribas in New York, said before the report. “There has also been investment in the commodity-related sectors such as agro-business, mining and energy that are doing well.”
The median forecast of 81 economists surveyed by Bloomberg News projected total production would rise 0.7 percent. Estimates ranged from gains of 0.1 percent to 1.2 percent.
The back-to-back increases in factory output were the biggest since July and August of 2009.
Chalk this one to "seasonal adjustments" or something, cause we no longer have any clue what is going on with the data fudging in America. When it comes to banana republic economic indicators the US is rapidly eclipsing China - case in point the Empire State Manufacturing Survey, which despite seeing the majority, or 6 out of 9 sub indices, declining in February, managed to not only rise, but beat the highest Wall Street estimate, printing at 19.53, the highest since June 2010, on expectations of 15.00, and compared to a previous print of 13.48. What lead to this epic surge? Why nothing short of a decline in just about two thirds of the components: New Orders declined from 21.69 to 22.79, Unfilled Orders declined from -5.49 to -7.06; Inventories declined from 6.59 to -4.71, Prices Paid declined from 26.37 to 25.88; Prices received declined from 23.08 to 15.29, and Number of Employees declined from 12.09 to 11.76. What increased? Shipments, Average Employee Workweek, and, drumroll, Delivery Times. And somehow this disaster of a report is supposed to bring peace and comfort to the market that things are getting better? Perhaps at the Fed's data manipulation department. And just like a 2.9 million seasonal NFP adjustment in January has resulted in an ebullient market tone, we wonder just how high 3 out of 9 subindices improving will send the market today?
Today's disappointing TIC report confirmed what Zero Hedge reported back in January, namely the record dumping of Treasurys by foreign entities. And while we will spare you the details of the report (found here), two things bear pointing out: the very demonstrative selling of US paper by Russia continues, and is now in its 14th consecutive month (as has been reported here consistently), as total USTs in Putin's possession declined to a fresh multi-year low of $88.4 billion, half of the $176 billion in October 2010. Also confirming that the Asian anti-USD axis is now one which consists of at least Russia and China (and certainly Iran), was the stepwise dump of US paper by Beijing which sold $32 billion in US bonds in December, bringing its total to a new post 2010 low of $1100.7 billion. And lastly, this was not isolated to just these two: in December the grand total of US Treasury holding by foreigners declined from $4.75 trillion to $4.732 trillion. The question then is: just what are China and Russia buying (ahem stockpiling) with all the dollars that are not recycled back into Treasurys?
Home builder confidence in the market for new single-family homes rose to its highest level in more than four years in February, according to a new survey released on Wednesday.
Confidence on the National Association of Home Builder's monthly sentiment index jumped 4 points to 29. Fifty, however, is still the line between positive and negative sentiment.
“This is the longest period of sustained improvement we have seen in the HMI since 2007, which is encouraging,” said NAHB Chief Economist David Crowe.
Home builder confidence in the market for new single-family homes climbed in February for the fifth straight month to reach the highest level in more than four years, according to a survey released Wednesday. The National Association of Home Builders/Wells Fargo housing market index rose to 29 in February from 25 in January, meaning the gauge has more than doubled since September. Economists polled by MarketWatch had expected a reading of 26. Though that's still far below the level considered "good" - the seasonally adjusted gauge needs a reading of 50 to do that, which hasn't been the case since April 2006 - it does indicate improving sentiment for builders. The home-builder gauge tracks closely with single-family housing starts, with the January data from that series due for release from the Commerce Department on Thursday.
Armageddon wrote:Despite Two Thirds Of Components Declining, Empire Fed Prints At Highest Since June 2010Chalk this one to "seasonal adjustments" or something, cause we no longer have any clue what is going on with the data fudging in America. When it comes to banana republic economic indicators the US is rapidly eclipsing China - case in point the Empire State Manufacturing Survey, which despite seeing the majority, or 6 out of 9 sub indices, declining in February, managed to not only rise, but beat the highest Wall Street estimate, printing at 19.53, the highest since June 2010, on expectations of 15.00, and compared to a previous print of 13.48. What lead to this epic surge? ...
The American Trucking Associations’ advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index jumped 6.8% in December after rising 0.3% in November 2011. The latest gain put the SA index at 124.5 (2000=100) in December, up from the November level of 116.6.
For all of 2011, tonnage rose 5.9% over the previous year – the largest annual increase since 1998. Tonnage for the last month of the year was 10.5% higher than December 2010, the largest year-over-year gain since July 1998. November tonnage was up 6.1% over the same month last year.
“While I’m not surprised that tonnage increased in December, I am surprised at the magnitude of the gain,” ATA Chief Economist Bob Costello said.
“Not only did truck tonnage increase due to solid manufacturing output in December, but also from some likely inventory restocking. Inventories, especially at the retail level, are exceedingly lean, and I suspect that tonnage was higher than expected as the supply chain did some restocking during the month.” he said.
rangerone314 wrote:The figures I gave were for January, which reflected a much sharper change downward than December, which was not looking grim.
This index has been weaker than other measures of transportation such as the ATA trucking index or the AAR rail traffic report. In the full report, Dr. Leamer looks at several possible explanations for the divergence - a shift to rail traffic, the difference between diesel fuel transaction (up for the year) and gallons (down for the year), and possible efficiency due to the high price of diesel fuel. There isn't a clear explanation.
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