Economic Reports 11/09/06
Nov. U of Mich Consumer Sentiment DOWN 92.3 vs prior 93.6
Weekly Initial Jobless Claims: DOWN to 308K vs prior 327K, continuing claims +43K to 2.45M
Weekly EIA Inventories: Crude +0.4MB, Gasoline -0.6, Distillate -2.7, Propane -0.777. Prices rose on the unexpected draw down in distillates. Full Report
BOE Rate Announcement: The Bank of England raised 25bps to 5%.
The statement pointed to "rapid growth" in money supply and credit, but was non committal to further rate hikes, the Sterling pound fell on the lack of "hawkish" verbiage.
Sept. Trade Deficit -6.8% to -64.3B vs prior -69B Full Report
Inside the number: A large drop in import oil prices (-15.5%) and a one off increase in civilian aircraft exports (+34.5%) lowered the deficit and lifted exports to a record high of $123.2B high.
However, the trade gap with China, a record $23B. YTD, the deficit $586.2B, up 12.3% from the same period last year, when the U.S. set a record annual deficit of $716.7B.
Oct. Import Prices -2% vs prior +0.1% Full Report
Inside the number: Export Prices -0.4% vs prior -0.5%, the decline can be attributed to a Oct. -8.3% and Sept -9.7% drop in imported petroleum prices and a -20.5% drop in natural gas prices.
However, stagflation is not dead, prices of imported autos, +0.3%, the largest increase in a year. Consumer goods prices also rose 0.1%.
Sept. Wholesale Inventories +0.8% vs prior +1.2% Full Report
Inside the number: Wholesale sales -1.2%, the largest drop in 3 years. In the past year inventories +9.9%, sales +8.1%. The inventory to sales ratio UP to 1.53 from 1.50 for durable goods, the highest in 3 years.
Sales of durable goods -0.3%, auto sales -1.3%, durable goods inventories +1.5%, auto inventories +1.9%. Large increases were also reported in lumber, metals, machinery and computers.
Summary: The BOE raised and left the door open for further hikes. Consumer sentiment down as the "energy price drop" euphoria wears off. Continuing unemployment is building.
The trade deficit saw a minor pullback due to the "energy price drop", but is still on track for a record year. Import & export prices also benefitted, but stagflation is anything but dead, as consumer & auto import prices increased.
Any energy related price shock will further stoke the fire of stagflation. Further buildup in durable goods inventories throughout the supply chain, could also lead to cutbacks in output and employment.
Weekly Initial Jobless Claims: DOWN to 308K vs prior 327K, continuing claims +43K to 2.45M
Weekly EIA Inventories: Crude +0.4MB, Gasoline -0.6, Distillate -2.7, Propane -0.777. Prices rose on the unexpected draw down in distillates. Full Report
BOE Rate Announcement: The Bank of England raised 25bps to 5%.
The statement pointed to "rapid growth" in money supply and credit, but was non committal to further rate hikes, the Sterling pound fell on the lack of "hawkish" verbiage.
Sept. Trade Deficit -6.8% to -64.3B vs prior -69B Full Report
Inside the number: A large drop in import oil prices (-15.5%) and a one off increase in civilian aircraft exports (+34.5%) lowered the deficit and lifted exports to a record high of $123.2B high.
However, the trade gap with China, a record $23B. YTD, the deficit $586.2B, up 12.3% from the same period last year, when the U.S. set a record annual deficit of $716.7B.
Oct. Import Prices -2% vs prior +0.1% Full Report
Inside the number: Export Prices -0.4% vs prior -0.5%, the decline can be attributed to a Oct. -8.3% and Sept -9.7% drop in imported petroleum prices and a -20.5% drop in natural gas prices.
However, stagflation is not dead, prices of imported autos, +0.3%, the largest increase in a year. Consumer goods prices also rose 0.1%.
Sept. Wholesale Inventories +0.8% vs prior +1.2% Full Report
Inside the number: Wholesale sales -1.2%, the largest drop in 3 years. In the past year inventories +9.9%, sales +8.1%. The inventory to sales ratio UP to 1.53 from 1.50 for durable goods, the highest in 3 years.
Sales of durable goods -0.3%, auto sales -1.3%, durable goods inventories +1.5%, auto inventories +1.9%. Large increases were also reported in lumber, metals, machinery and computers.
Summary: The BOE raised and left the door open for further hikes. Consumer sentiment down as the "energy price drop" euphoria wears off. Continuing unemployment is building.
The trade deficit saw a minor pullback due to the "energy price drop", but is still on track for a record year. Import & export prices also benefitted, but stagflation is anything but dead, as consumer & auto import prices increased.
Any energy related price shock will further stoke the fire of stagflation. Further buildup in durable goods inventories throughout the supply chain, could also lead to cutbacks in output and employment.
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