Today's Economic Data Highlights
Goldman's Ed McKelvey summarizes today's key economic data:
Lots going on today, beginning with some labor market indicators, then industrial and construction data, then Fed speeches punctuated by reports from vehicle manufacturers….
The Mortgage Bankers Association’s index of mortgage applications rose 2.7%, the fifth consecutive weekly increase. This one was composed of a 1.8% increase in the purchase loan index and a 2.8% increase in the refinancing index. However, this index remains in a very low range.
7:30: Challenger job cuts for Aug….a moderation in the rate of improvement. With the labor market appearing to have stalled, the year-to-year decline may be less than 50%, especially since layoffs a year ago were already improving.
8:15: ADP employment report for Aug…did private hiring slow? The median forecast shows only a trivial increase. Since the last revamping of this report in December 2008, it has tended to understate the net change in private-sector payrolls (by 63k, on average) and has only overstated in two months.
Median forecast (of 35): +15k, ranging from -50k to +55k; last +42k.
10:00: ISM manufacturing index for Aug…slowdown? The industrial data continue to show a weakening trend in the US manufacturing sector, leading most economists to forecast a step down in the ISM’s index.
Median forecast (of 78) 52.7, ranging from 49.9 to 56; last 55.5.
10:00: Construction outlays for July…a decline? Our model suggests a sharp slowing in the wake of a post-tax-credit drop-off in starts and weak fundamentals outside the residential sector.
GS: -1.6%; median forecast (of 50): -0.5%, ranging from -1.6% to +0.5%; last +0.1%.
10:45: Federal Reserve Governor Elizabeth Duke speaks…at a Washington summit looking into the effects of foreclosures and vacant properties on neighborhoods. Although Gov. Duke was cited last week in the Wall Street Journal as one of seven FOMC members expressing reservations about the decision to reinvest MBS proceeds, she ultimately voted for it. It is unlikely that this appearance will shed any light on her views regarding this decision given the specific focus of this speech and the lack of a Q&A session.
13:40: Dallas Fed President Richard Fisher speaks on the US economy…in Houston. Mr. Fisher was also among the seven cited in the Wall Street Journal article. His next turn on the voting rotation of the FOMC comes in 2011.
Late morning/early afternoon: Lightweight vehicle sales for Aug…still subdued. Anecdotal reports from the manufacturers suggest a moderation in August.
For total sales: Median forecast (of 40): 11.55mm, ranging from 11.3mm to 11.85mm; last: 11.56mm.
For domestic only: Median forecast (of 16): 8.85mm, ranging from 8.5mm to 9.23mm; last 9.11mm.
8:45: Chicago Fed President Charles Evans speaks….closing the summit at which Gov. Duke is also expected to appear. Mr. Evans is not currently a voting member of the FOMC; his next turn is in 2011.