Thursday, 3 May 2007

More signs of strength in manufacturing

There were more signs of a recovery in US manufacturing yesterday. From MarketWatch:

Orders for U.S.-made factory goods rose 3.1% in March, the biggest gain in a year, the Commerce Department reported Wednesday...

The gains in March, led by a 38% increase in orders for civilian aircraft and an 11% increase in petroleum, were strong across the board. Read the full government report.

... Orders for core capital equipment...rose 4.8%, the fastest pace in nearly three years and stronger than originally reported. Orders for durable goods were revised higher to 3.7%. Shipments of factory goods increased 1.5%, the highest in 10 months. Unfilled orders grew 1.8%, the fastest pace this year. Orders in February were revised up by four-tenths of a percentage point to 1.4%...

In a report released Wednesday, payroll giant ADP said its monthly employment report showed 64,000 new jobs in the private sector in April, the weakest job growth in nearly four years. Manufacturing employment fell by 20,000, in line with the recent trends. See full story.

Manufacturing also accelerated in China, the CLSA China Purchasing Managers’ Index rising to 53.3 in April, its highest level since May 2005, from 52.3 in March.

In the euro zone, Bloomberg reports that the Royal Bank of Scotland's index of manufacturing was unchanged at 55.4 in April as the unemployment rate fell to 7.2 percent in March from 7.3 percent in the previous month.

In the UK, Reuters reports that construction activity growth picked up at its fastest rate in nearly 3-1/2 years in April. Nevertheless, a fall in mortgage approvals to 113,000 in March from 118,000 in February points to a possible moderation in the housing market.

Meanwhile, the recent negative trend in Japanese data continued yesterday, the Ministry of Health, Labour and Welfare reporting that Japanese wage earners' total cash earnings fell 0.4 percent in March from a year ago.

That could encourage more yen carry trades, although the Reserve Bank of Australia left interest rates at 6.25 percent yesterday.

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