Leading Economic Indicators Exercise: Search, ​Locate Identify, ​ & Interpret

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The University of Michigan’s consumer sentiment for the United States was revised up to 98.5 in November of 2017 from a preliminary of 97.8. Still, it was lower than 100.7 in October which was the strongest since January 2004. Expected economic conditions deteriorated compared to the previous month although less than initially estimated.

The gauge of consumer expectations fell to 88.9 from 90.5 in October but was higher than a preliminary of 87.6. The current conditions index went down to 113.5 from 116.5 in October and a preliminary reading of 113.6.

Also, Americans expect the inflation rate to be 2.5 percent, next year, higher than 2.4 percent in October but lower than a preliminary of 2.6 percent. The 5-year expectation was also revised down to 2.4 percent from 2.5 percent in October and in the first estimate.
What has changed recently is the degree of certainty with which consumers hold their economic expectations. In contrast to the media buzz about approaching cyclical peaks and an aging expansion, with the implication of greater uncertainty about future economic trends, consumers have voiced greater certainty about their expectations for income, employment, and inflation.
Inflation expectations have shown the smallest dispersion on record, and increased certainty about future income and job prospects has become a key factor that has supported discretionary purchases. To be sure, caution is warranted given that the current expansion will soon be the second longest expansion since the mid-1800s, as well as the potential for significant changes in tax policies and the new Fed leadership and Board members.
Interestingly, the data indicate that neither changes in fiscal nor monetary policies have yet had any noticeable impact on consumer expectations. Overall, the data signal an expected gain of 2.7% in real consumption expenditures in 2018, and more importantly for retailers, the best runup to the holiday shopping season in a decade.
–> Trading Economics 

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US 10Y increased 0.04 percent or 0.04% to 2.40 on Monday December 4 from 2.36 in the previous trading session. Historically, the United States Government Bond 10Y reached an all time high of 15.82 in September of 1981 and a record low of 1.36 in July of 2016.

–> Trading Economics

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Via Mr. Sanders of  Snake Hole Lounge

 

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New Orders in the United States increased to 478455 USD Million in September from 471684 USD Million in August of 2017. New Orders in the United States averaged 375309.75 USD Million from 1992 until 2017, reaching an all time high of 565232 USD Million in July of 2014 and a record low of 223500 USD Million in February of 1992.

–> Trading Economics

New orders for US manufactured durable goods shrank 1.2 percent month-over-month in October of 2017, following a 2.2 percent increase in September and compared to market expectations of a 0.3 percent gain. Orders for transport equipment slumped 4.3 percent and those for nondefense aircraft and parts went down 18.6 percent, after jumping 4.4 percent and 33.9 percent respectively in September due to a rise in Boeing aircraft orders. Non-defense capital goods orders excluding aircraft, seen as a proxy for business spending plans went down 0.5 percent, the biggest drop since September of 2016 and following an upwardly revised 2.1 percent gain in the previous month.

Excluding transportation, new orders increased 0.4 percent. Excluding defense, new orders decreased 0.8 percent.
Shipments of manufactured durable goods in October, up five of the last six months, increased $0.3 billion or 0.1 percent to $241.0 billion. This followed a 1.0 percent September increase. Primary metals, up three of the last four months, led the increase, $0.3 billion or 1.5 percent to $19.9 billion.
Unfilled orders for manufactured durable goods in October, down three of the last four months, decreased $0.5 billion or virtually unchanged to $1,134.6 billion. This followed a 0.2 percent September increase. Transportation equipment, also down three of the last four months, drove the decrease, $2.0 billion or 0.3 percent to $769.7 billion.
Inventories of manufactured durable goods in October, up fifteen of the last sixteen months, increased $0.5 billion or 0.1 percent to $404.1 billion. This followed a 0.6 percent September increase. Primary metals, also up fifteen of the last sixteen months, led the increase, $0.1 billion or 0.4 percent to $33.9 billion.
Nondefense new orders for capital goods in October decreased $3.4 billion or 4.5 percent to $72.3 billion. Shipments decreased $1.4 billion or 1.9 percent to $72.4 billion. Unfilled orders decreased $0.1 billion or virtually unchanged to $705.2 billion. Inventories increased less than $0.1 billion or virtually unchanged to $179.7 billion. Defense new orders for capital goods in October decreased $1.1 billion or 9.6 percent to $9.9 billion. Shipments increased $0.3 billion or 2.4 percent to $10.9 billion. Unfilled orders decreased $0.9 billion or 0.7 percent to $142.3 billion. Inventories increased $0.2 billion or 1.0 percent to $23.6 billion.
–> Trading Economics

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The number of Americans filing for unemployment benefits decreased by 2 thousand to 238 thousand in the week ended November 25th from the previous week’s revised level of 240 thousand and below market expectations of 240 thousand. It is the second straight week of declines in initial claims. Claims taking procedures continue to be disrupted in the Virgin Islands.

Claims remained below the 300,000 threshold for 143 straight weeks, the longest such stretch since 1970 when the labor market was smaller.

The 4-week moving average was 242,250, an increase of 2,250 from the previous week’s revised average. The previous week’s average was revised up by 250 from 239,750 to 240,000.

The advance seasonally adjusted insured unemployment rate was 1.4 percent for the week ending November 18, unchanged from the previous week’s unrevised rate.
The advance number for seasonally adjusted insured unemployment (continuing jobless claims) during the week ending November 18 was 1,957,000, an increase of 42,000 from the previous week’s revised level. The previous week’s level was revised up 11,000 from 1,904,000 to 1,915,000. The 4-week moving average was 1,911,000, an increase of 18,250 from the previous week’s revised average. The previous week’s average was revised up by 2,750 from 1,890,000 to 1,892,750.
–> Trading Economics

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Privately-owned housing units authorized by building permits jumped 7.4 percent in October to seasonally adjusted annual rate of 1,316 thousand, according to revised figures. Preliminary estimates showed building permits went up at a slower 5.9 percent to 1,297 thousand. Building Permits in the United States averaged 1356.13 Thousand from 1960 until 2017, reaching an all time high of 2419 Thousand in December of 1972 and a record low of 513 Thousand in March of 2009.

–> Trading Economics

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Government Debt in the United States increased to 20442474 USD Million in October from 20244900 USD Million in September of 2017. Government Debt in the United States averaged 4214528.72 USD Million from 1950 until 2017, reaching an all time high of 20442474 USD Million in October of 2017 and a record low of 253400 USD Million in April of 1951.

–> Trading Economics

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Unit labor costs in the US nonfarm business sector rose an annualized 0.5 percent on quarter in the third quarter of 2017, higher than an upwardly revised 0.3 percent increase in the second quarter and in line with market expectations, preliminary estimates showed. It reflects a 3.5 percent increase in hourly compensation and a 3.0 percent increase in productivity. Unit labor costs decreased 0.1 percent over the last four quarters. Labour Costs in the United States averaged 59.75 Index Points from 1950 until 2017, reaching an all time high of 109.07 Index Points in the third quarter of 2016 and a record low of 17.12 Index Points in the first quarter of 1950.

–> Trading Economics

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The US economy expanded an annualized 3.3 percent on quarter in the third quarter of 2017, above an advance reading of 3 percent and higher than market expectations of 3.2 percent, the second estimate from the BEA showed. It is the highest growth rate since the third quarter of 2014 when the economy advanced 5.2 percent as nonresidential fixed investment, private inventory investment and government spending were revised up.

Personal consumption expenditure (PCE) contributed 1.6 percentage points to growth (1.62 percent in the advance estimate) and rose 2.3 percent (2.4 percent in the advance estimate). Spending slowed more than anticipated for nondurable goods (2 percent compared to 2.1 percent in the advance estimate) and rose less for durable goods (8.1 percent compared to 8.3 percent in the advance estimate). Services went up 1.5 percent, the same as in the advance estimate.
Fixed investment added 0.39 percentage points to growth (0.25 percentage points in the advance estimate) and increased 2.4 percent, compared to a 1.5 percent expansion in the advance estimate. Investment rose more for equipment (10.4 percent compared to 8.6 percent in the advance estimate) and intellectual property products (5.8 percent compared to 4.3 percent) and shrank less for residential (-5.1 percent compared to -6 percent). On the other hand, it fell more for structures (-6.8 percent compared to -5.2 percent).
Private inventories added 0.8 percentage points to growth, compared to 0.73 percent in the advance estimate.
Meanwhile, exports went up at a slower 2.2 percent (2.3 percent in the advance estimate) and imports shrank 1.1 percent, faster than a 0.8 percent drop in the advance estimate. As a result, the impact from trade was revised higher to 0.43 percent from 0.41 percent.
Government spending and investment added 0.07 percentage points to growth, compared to a drag of 0.02 percentage points. It increased 0.4 percent, compared to an initial estimate of a 0.1 percent fall.
–> Trading Economics

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The trade deficit in the United States widened to USD 43.5 billion in September 2017 from an upwardly revised USD 42.8 billion in August and compared to market expectations of a USD 43.2 billion gap. Exports rose 1.1 percent to the highest since December of 2014 while imports increased at a slightly faster 1.2 percent.

Exports went up 1.1 percent month-over-month to USD 196.8 billion, reaching the highest value since December of 2014. Exports of goods increased USD 1.8 billion to USD 130.6 billion, also the highest since December of 2014: industrial supplies and materials rose USD 1.9 billion; crude oil went up USD 1.1 billion; nonmonetary gold increased USD 0.3 billion and other goods rose USD 0.8 billion. In contrast, sales of consumer goods decreased 0.2 billion and pharmaceutical preparations went down USD 1.0 billion. Exports of services increased USD 0.3 billion to a record high of USD 66.2 billion in September, with transport rising USD 0.3 billion.
Imports jumped 1.2 percent month-over-month to USD 240.3 billion, recovering from an upwardly revised 0.2 percent drop in August. Imports of goods increased USD 2.4 billion to USD 196.0 billion: capital goods surged USD 1.5 billion; semiconductors increased USD 0.5 billion; civilian aircraft rose USD 0.3 billion; industrial supplies and materials went up USD 1.1 billion and other petroleum products increased USD 0.7 billion. In contrast, purchases of automotive vehicles, parts, and engines decreased USD 0.6 billion and those of passenger cars fell USD 0.5 billion. Imports of services increased USD 0.4 billion to USD 44.3 billion in September: transport went up USD 0.3 billion.
On a non-seasonally adjusted basis, exports went up to OPEC (26.8 percent), Japan (10.3 percent) and the European Union (3.8 percent) but fell to Mexico (-3.7 percent), China (-1.1 percent) and Canada (-0.2 percent). Imports declined from all main import patners, namely China (-0.8 percent), Canada (-2.4 percent) and  Mexico (-4.6 percent). As a result, the US trade deficit narrowed with all main trading partners: China (USD -34.6 billion from USD -34.89 billion), the EU (USD -11.4 billion from USD -12.4 billion); Mexico (USD -5.7 billion from USD -6.2 billion); Japan (USD -4.8 billion from USD -6.5 billion) and Canada (USD -0.25 billion from USD -0.8 billion).
 –> Trading Economics

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Consumer Price Index CPI in the United States increased to 246.64 Index Points in October from 246.37 Index Points in September of 2017. Consumer Price Index CPI in the United States averaged 109.38 Index Points from 1950 until 2017, reaching an all time high of 246.64 Index Points in October of 2017 and a record low of 23.51 Index Points in January of 1950.

–> Trading Economcis

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The IHS Markit US Manufacturing PMI was revised marginally higher to 53.9 in November of 2017 from a preliminary reading of 53.8 but remained below 54.6 in October. Output, new orders, employment all rose at a softer pace while signs of capacity pressures persisted, with backlogs of work increasing again. In addition, cost pressures intensified with output inflation reaching the highest since December of 2013. On the other hand, business confidence was the strongest since January of 2016. Manufacturing PMI in the United States is reported by Markit Economics.

–> Circa Trading Economics

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Average Weekly Hours in the United States remained unchanged at 34.40 Hours in October from 34.40 Hours in September of 2017. Average Weekly Hours in the United States averaged 34.34 Hours from 2006 until 2017, reaching an all time high of 34.60 Hours in March of 2014 and a record low of 33.70 Hours in June of 2009.

–> Trading Economics

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