Today's Economic Data Highlights
A heavy day for data, with readings on consumer spending and spending, industrial activity, and construction. Also, a couple of Fed speeches on tap….
8:30: Personal income and outlays for Aug....small increases in real terms. The jobs report for August suggests a modest gain in personal income, while retail and auto sales data imply a similar outcome for spending. The PCE core index appears likely to post an increase well above the +0.04% reading on the core CPI, as it gives more weight to medical costs and less to shelter.
On income….median forecast (of 77): +0.3%, ranging from +0.2% to +0.6%; last +0.2%.
On spending....median forecast (of 79): 0.3%, ranging from +0.2% to +0.5%; last +0.4%.
On PCE core price index: median forecast (of 57): +0.1%, ranging from flat to +0.2%; last +0.11%.
10:00 (9:55 to subscribers): Reuters/University of Michigan consumer sentiment for Sep (final)…slight uptick? This index fell unexpectedly in the preliminary survey, and forecasts are biased to expect a small recovery of that decline. The median expectation for inflation five to ten years ahead remains in a tight 2.7%-2.9% range (since November), with the latest reading at 2.8%.
Median forecast (of 64): 67.0, ranging from 65.5 to 68.5; last 66.6 (Sep prelim).
10:00: ISM manufacturing index for Sep…slowdown? Despite increases in the Chicago index and in our own analyst index, we look for a setback in the ISM’s national survey of purchasing agents in the manufacturing sector. Most Fed surveys point in this direction as does the detail from the August ISM survey, specifically the virtual disappearance of the difference between new orders and inventories.
Our ISM call for the September report is only modestly below the median forecast. We are expecting this index to move below 50, but that is a 3-6 month view, not our call for today’s figure.
GS: 54; median forecast (of 83) 54.5, ranging from 51.5 to 57, last 56.3.
10:00: Construction outlays for Aug…a decline? We likewise look for a small setback in construction, with the decline concentrated in private residential projects.
GS: -0.4%; median forecast (of 54): -0.4%, ranging from -1.0% to +1.5%; last -1.0%.
10:30: Chicago Fed President Charles Evans speaks at a monetary policy conference in Rome….The conference is on “The Future of Monetary Policy,” and it is hosted by the Bank of Italy, the Banque de France, and the Einaudi Institute for Econoims and Finance. Mr. Evans’ next turn on the voting rotation of the FOMC comes in 2011.
Late morning/early afternoon: Lightweight vehicle sales for Sep…still subdued. Anecdotal reports from the manufacturers suggest little change in September from the low levels that have prevailed for the last half year or so.
For total sales: GS: 11.7 million; median forecast (of 45): 11.5mm, ranging from 11.1mm to 11.9mm; last: 11.46mm.
For domestic only: GS: 8.4mm; median forecast (of 17): 8.85mm, ranging from 8.4mm to 8.9mm; last 8.66mm.
13:40: Dallas Fed President Richard Fisher speaks on the US economy, recovery, and monetary policy.…in Vancouver. His next turn on the voting rotation of the FOMC comes in 2011.
Ed McKelvey of Goldman Sachs