Forex News | Currency News by Forexlive

WASHINGTON (MNI) – U.S. consumer sentiment improved in the final
reading for September after plummeting last month to levels not seen
since May 1980, according to the Reuters/University of Michigan Consumer
Sentiment survey released Friday.

The index came in at 59.4 — above median expectations of 57.8 —
vs. the preliminary reading of 57.8. The consumer sentiment index was
55.7 in August and 63.7 in July.

The index’s final measure of consumers’ view of current conditions
in September came in at 74.9, a phantom improvement over September’s
inital reading of 74.5. The index was 68.7 in August, and 75.8 in July.

After declining to 47.0 in the preliminary report, the lowest since
May 1980, the final gauge of consumers’ expectations rose slightly to
49.4. This after coming in at 47.4 in August and 56.0 in July.

Consumers’ final 1-year inflation expectations for September was
3.3%, down from an expectation of 3.5% in August. The expectation was
for 3.4% in July. Final five-year inflation expectations are at 2.9%,
down from the preliminary expectation of 3.0% but unchanged vs. the last
two months.

Despite the small move upwards, the fact that consumer sentiment
remains at low levels in September is hardly surprising, as ongoing
worries over anemic economic growth in the United States and the the
persistently high level of unemployment cause Americans to be — as
Federal Reserve Chairman Ben Bernanke put it — “exceptionally
cautious.”

The August U.S. Personal Income report Friday showed disappointing
consumption as wages dropped; moreover, July spending was revised lower.
August Personal Income declined by 0.1%, in its first drop since -0.1%
in October 2009. Private wages retreated $12.2 billion after gaining
$23.8 billion in July as goods and services payrolls fell.

Philadelphia Fed President Charles Plosser said in a speech
Thursday that recent volatility in financial markets has contributed to
sharp declines in business and consumer sentiment. “But with a high
degree of uncertainty over future taxes, regulations, and the financial
ramifications of the European sovereign debt situation, it is no wonder
that sentiment is flagging and this decline poses added risk to the
growth forecast,” he said.

The raging EU sovereign debt crisis, and the risk of a negative
feedback loop feeding into the financial system and real economy, has
policymakers in the U.S. and elsewhere very concerned.

Dallas Federal Reserve President Richard Fisher Tuesday said U.S.
federal regulators must make sure there is no contamination from the
turmoil across the Atlantic, and ensure that U.S. financial institutions
are not exposed to any “trip wires” or contagion from Europe’s woes.

** Market News International Washington Bureau: 202-371-2121 **

[TOPICS: M$U$$$,MAUDS$,M$$CR$]

US DATA: Sep final Rtrs-UMich consumer sentiment data show current conds
74.9 vs 74.5p, expectations 49.4 vs 47.0p. 1y infl expectations 3.3% and
5y at 2.9%.

US DATA: Sep final Rtrs-UMich consumer sentiment 59.4 vs 57.8p and
55.7 in Aug.

–’Surprisingly Strong Reprt in an Overall Fragile Economic Environment’
–’We Are Seeing Unannounced and Incredible Inflation’ From Europe

By Denny Gulino

WASHINGTON (MNI) – The Chicago Business Barometer jumped to 60.4
for September after seasonal adjustment, rebounding from August’s
21-month low of 56.5 by 3.9 points — 4.9 points more than the level
expected — with employment, new orders and production indexes showing
notable acceleration.

September was a second month of above-expectations performance,
after August’s level came in 3.5 points above the anticipated median,
even though it was 4.2 points below July. The September expectation in a
Market News International survey had centered on a slight softening from
August, at 55.5.

September’s improvement was equally impressive before seasonal
adjustment, going to 62.8, 4.1 points ahead of August’s unadjusted 58.7.

Employment’s index reading showed a sizable leap, going to 60.6,
8.4 points above August’s 52.1, the largest monthly gain since January
of last year and the highest level in four months.

The comparison for New Orders was even better, with the 65.3 a full
8.4 points above August’s 56.9 and the biggest monthly gain the best
since October 2009 that erased net declines accumulated since April.

The Production index was 63.9 adjusted in September, compared to
57.8 in August.

Elsewhere in the report, there was some backsliding. The Supplier
Deliveries index showed lead times accelerating, an index value of 51.9
compared to August’s 60.5 — and a two-year low.

Order Backlogs were pared back, with a reading of 45.4 compared to
the previous 49.6 to drop to a 23-month low. And inventory accumulation
began to mount, up to 60.3 vs. 52.9.

The Prices Paid reading suggested some pricing power weakness among
suppliers, going to 62.3 from 68.6, a one-year low. Prices Paid had
backed off somewhat in August as well, from July’s 71.7.

Said the Chicago PMI report formulators, “Collectively, the pattern
of a second month of contraction in Order Backlogs, faster Supplier lead
times and Inventory accumulation combined to reduce the luster of an
otherwise surprisingly strong report in an overall fragile economic
environment.” The 40-year median for the top headline number is 55.3.

The Business Activity indexes are derived from responses to the
monthly survey by ISM-Chicago of business executives in Chicago-linked
firms, many of them with extensive operations outside the Chicago region
and some with large services components.

Among the random comments from respondents, one saw “concerns with
double-dip recession due to short-term strategies for raw material and
energy pricing.”

Another said, “Our production is slammed right now, but our backlog
is still low, basically everything we are getting in we are pushing out
the door as fast as we can complete them.”

Still another said simply, “Business continues strong and the
backlog remains good.”

One firm is seeing imported inflation accelerating. “We are seeing
unannounced and incredible inflation on one product, multiple parts,
that we are purchasing out of Europe.” The respondent continued, “At
400% increase we thought surely must have been a mistake. This is not
related to dollar exchange since we pay in euros already. Supplier says
they cannot absorb costs any more.”

In a question posed in the survey, “How far in advance must you buy
to have when needed” for Production Materiel? the answer came back at
40.6 days, an increase from August’s 30.3 days and July’s 28.9 days. The
40-year median for that number is 30.9 days.

** Market News International Washington Bureau: 202-371-2121 **

[TOPICS: MAUDS$,MT$$$$,M$U$$$,MAUCS$]

CHICAGO (MNI) – The following are comments from members of the
survey panel who contributed to the September Chicago PMI report
released Friday:

1. “We are seeing unannounced and incredible inflation on one
product, multiple parts, that we are purchasing out of Europe. At 400%
increase we thought surely must have been a mistake. This is not related
to $ exchange since we pay in Euros already. Supplier says they cannot
absorb costs anymore.”

2. “Continued export of manufacturing with simultaneous mandates to
reduce global raw material inventories while maintaining high customer
service levels globally is the greatest challenge. Locating new
localized sources for raw goods in new manufacturing locations also
lengthy and expensive. Quality consistency seems to be the biggest
headache for new factories attempting to qualify local suppliers. US
based goods often continue to be used at a higher cost thus impacting
the bottom line but keeping customers coming back.”

3. “Talk of tax increases has many of my suppliers nervous and they
now are reluctant to expand their business with either labor or capital
investments.”

4. “Business continues strong & the backlog remains good.”

5. “We are finally adding personnel on a regular basis to help meet
the increasing demand we are facing. Our standards are lower in terms of
experience but not quality of the employee.”

6. “We buy gold for our manufacturing process. Pricing is Ugly!!!!”

7. “Concerns with double dip recession due to short term strategies
for raw material and energy pricing (example: oil pricing has dropped
significantly; however, prices at the pump remain elevated). This
approach to pricing appears to be systemic resulting in eroding margins
and lack of capital to fund growth for manufacturers in USA.”

8. “Our production is slammed right now, but our backlog is still
low, basically everything we are getting in we are pushing out the door
as fast as we can complete them.”

** Market News International Chicago Bureau: (708) 784-1849 **

[TOPICS: M$U$$$,MAUDS$]

US DATA: Chicago PMI rebounded to 60.4 in Sept vs 56.5 Aug, marking a
24th month of expansion. Sees significant gains in EMPLOYMENT and
NEW ORDERS while ORDER BACKLOGS contracted and SUPPLIER DELIVERIES
remained in a 14-month up-and-down pattern. New orders 65.3 vs 56.9,
Employment 60.6 vs 52.1. Prices paid 62.3 vs 68.6. Comments see
inflation in parts and commodities and see continued exports as a
challenge.

Forecast was for 57.8.

in EUR/USD below 1.3430…

Worries over Slovakian passage of the EFSF are helping keep EUR/USD from rebounding despite the strong Chicago PMI data.

The Slovakian PM says he cannot comment on progress on proposals made to his coalition partners designed to secure passage of EFSF. He says the debate on the matter will take place before the October EU summit.

USD/JPY tells no lies!

We don’t need no stinkin’ QE!

• <
• 1
• ...
• 3
• 4
• 5
• 6
• 7
• ...
• 305
• >