U.S. Manufacturing PMI Index Edged Up to 51.7%

Today, the U.S. Manufacturing ISM report came out; according to the recent update, the U.S. Manufacturing PMI index edged up to 51.7% during October 2012. The U.S. Manufacturing PMI is an index that estimates the economic development of the U.S. manufacturing sectors; this means the manufacturing sector continues to grow at a slightly faster pace compared to the previous month; the index rose from 51.5% in September to 51.7% in October i.e. a 0.2 percent point rise. This means that the U.S. manufacturing sector has expanded in the past couple of months.

Among the factors that were examined in this survey: new orders, production, employment and exports. The production rose by 2.9 pp to 52.4 – the production has shifted from contraction to expansion. New orders, much like the PMI, are also growing faster as its index rose by 1.9pp to 54.2. Some items, however, shifted continue to contact including: backlog of orders, exports and imports. Further these items are not only contracting but they are also contracting faster in October than they did in September.

According to Roache et. al (2008) it was suggested that the PMI Manufacturing ISM report tends to be negatively correlated with the changes of gold and silver prices without controlling to the U.S dollar effect. Furthermore, the PMI news suppose to have a positive lagged effect on natural gas prices, i.e. all things being equal, including the U.S dollar, as the PMI Manufacturing ISM index increases, natural gas prices also tend to fall.


U.S Jobless Claims Declined by 9k

According to the recent jobless claims report, number of jobless claims declined by 9,000 compared to the previous week and reached 363,000. This figure is another positive signal for the progress of the U.S economy.

Non-Farm Payroll Report – Will It Surprise Again?

Tomorrow the non-farm payroll report will be published. In the previous report number of jobs added reached 114k. The rate of unemployment declined to 7.8%. Will the upcoming report be as positive as the previous report was? According to the ADP, the estimated number of jobs added in October was 158k. If these figures will be close to this estimate, it could help rally the commodities and stocks markets.

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