Today's Economic Data - PPI, Industrial Production And Homebuilder Sentiment And Two POMOs

Here are today's economic highlights, for anyone who cares and is deluded to think that any economic numbers actually still matter and drive the market and not vice versa.

8:30: Producer Price Index (December): Moderate core. We forecast that the PPI increased by 0.3% (month-over-month) in December, helped by higher energy prices. However, we expect that the core PPI again increased by just 0.1%.

PPI: GS: +0.3%; Consensus: +0.1%; Last +0.3%.
Core PPI: GS: +0.1%; Consensus: +0.1%; Last +0.1%. MAP: 2

9:00: TICS net inflows (November). Foreign inflows into long-term US securities slowed in October on a drop in net purchases of US Treasury securities. Foreign investors also stepped up their net sales of corporate bonds during the month. In light of the improved performance of Treasuries in late October, these inflows likely recovered in the November report.

Consensus: +$40bn; last +$5bn.

9:15: Industrial production (December): Rebound. We forecast a solid 0.6% (month-over-month) increase in industrial production for December. Several factors point to a rebound following a decline of 0.2% in November. First, manufacturing surveys, such as the ISM report, picked up in December. Second, manufacturing employment and average weekly hours increased, suggesting production may have gained as well. Third, weekly production data show a sharp increase in US car and truck assemblies during the month.

Production: GS: +0.6%; Consensus: +0.5; Last -0.2%. MAP: 2
Capacity utilization: GS: 78.1%; Consensus: 78.1%; Last 77.8%.

9:30: Federal Reserve Governor Daniel Tarullo testifies on regulatory issues.

10:00: Housing Market Index (January): Another increase? Consensus forecasts expect another increase in the NAHB homebuilder sentiment index this month. The post-crisis high for this indicator is 22 (reached in May 2010). A reading above this level would be a fairly encouraging sign about the housing market recovery.

Consensus: 22; Last 21. MAP: 1

11:00: The Open Market Desk will sell nominal Treasury coupons in the 11/15/2013 - 02/28/2014 maturity range

14:00: - The Open Market Desk will buy nominal Treasury coupons in the 02/15/2020 - 11/15/2021 maturity range.


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