Oh My Goodness! Where are we???
Written by A Forex View From Afar on Friday, February 01, 2008Back to www.thelfb.com
Last week was like no other. In essence, everything we were told was dismissed a couple of days later, starting from the most simple releases to the most complex.
Here starts the story;
Jobs: The ADP announced there were 70k new jobs created, while NFP said that 17k jobs were shredded from the economy. The ADP number was revised down 3k to 37k, the NFP was revised to 82k up from 18k. Unemployment Claims rose while the Unemployment rate measured by the NFP actually dropped. ISM also showed contraction in the employment sector.
Prices: PCE said prices remain somehow stable at 0.2%, while ISM Manufacturing Index indicated the price index has increased 8%
Income: The Personal Income index showed that income had increased 1.1%, while the NFP's Average Hourly Earnings told us income had increase a feeble 0.2%
Spending: Retailers announced this December as being one of the worst, while statistics such as Durable good and Personal Spending indicated that consumers are actually spending more.
Business: Chicago PMI showed contraction in the Business sector while ISM actually shows they are expanding.
GDP: ISM shows expansions, and quoting from the ISM release "The past relationship between the PMI and the overall economy indicates that the PMI for January (50.7) corresponds to a 3 percent increase in real gross domestic product (GDP) on an annual basis." but the GDP came in at 0.6% with lower odds of increase in the future, and with the 3.0% growth in GDP seen by ISM, the Fed had cut another 50 points.
Despite the rate cut, consumer confidence is very high (probably dreaming of a bigger house, with teaser interest rates)
This is why I like the Swiss economy. The most important national statistic is the income sheet of UBS and Credit Suisse :))
After this past week of important economic releases, the question has to be asked: Where are we? and the answer seems to be, right where we were before last week.
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