US industrial production rebounds but recession to persist

The fourth quarter may have started on a positive note for the US economy, at least as far as industrial production is concerned. From Bloomberg:

Industrial production rebounded in October after refinery shutdowns from Gulf Coast hurricanes caused the biggest drop since 1946 the month before.

The 1.3 percent gain wasn't enough to make up for the 3.7 percent September plunge, and output shrank by 0.7 percent in each of the past two months after excluding the effect of the hurricanes and a Boeing Co. strike, the Federal Reserve said...

Other data released on Monday weren't as positive.

The New York Fed's general economic index fell to minus 25.4, the lowest since records began in 2001, from minus 24.6 percent in October. Readings below zero for the so-called Empire State index signal manufacturing is shrinking.

For the day, investors chose to focus on the negative.

The Standard & Poor's 500 Stock Index fell 2.6 percent to close at 850.75. Yields on benchmark 10-year Treasury notes fell to 3.66 percent at 4:17 p.m. in New York from 3.73 percent at last week's close.

The same can be said of economists of late. Again from Bloomberg:

The U.S. has entered a recession that will persist into next year, and economies around the world will follow suit, according to a survey of business economists.

After growing 1.4 percent this year, the U.S. will contract 0.2 percent in 2009, according to the median estimate in a poll taken by the National Association for Business Economics. A majority of respondents said the U.K., euro area, Japan, Canada and Mexico are either now, or will soon be, in a recession...

Economists surveyed by Bloomberg News from Nov. 3 to Nov. 11 were more pessimistic about the U.S. economy than the NABE group. The economy will probably contract 0.3 percent next year, prompting central bankers to lower the key rate to a record-low 0.5 percent by March, the Bloomberg survey showed.