Manufacturing slowing but consumer electronics sales to hit record; German unemployment falls

Many commentators see the minutes of the last FOMC meeting as signalling an impending end to interest rate hikes. The latest manufacturing data would probably have reinforced this view.

Global manufacturing activity improved in 2005, but showed signs of losing momentum at year-end, bogged down by slower growth in the United States, the world's largest economy.

Japan's economic turnaround and ongoing improvement in the euro zone have offset slower U.S. growth. After posting record highs in September in the aftermath of Hurricane Katrina, falling energy costs have been a relief for manufacturers.

A global Purchasing Managers Index (PMI), compiled by J.P. Morgan from national and regional polls of thousands of companies worldwide, slipped to 54.0 in December from November's 54.6, but was above a reading of 53.6 a year ago...

In the United States, [t]he ISM manufacturing index...fell to 54.2 in December from 58.1 in November...

The Japanese index rose to 55.7, the highest reading since December 2003 and up from 55.3 in November...

The overall euro zone PMI...rose to 53.6 in December from 52.8 in November, while Italy's PMI hit a five-year high...

But in Britain, the main index inched up to 51.1 from 51.0 in November...

The China index rose to 50.1, buoyed by new export orders, from 49.8 in November...

Reuters covers the US reports, including the milder-than-expected 0.2 percent rise in construction spending and the US markets' excited responses.

Slowdown or not, the Consumer Electronics Association forecasts record sales in consumer electronics this year. Bloomberg reports.

Worldwide sales of consumer electronics will probably rise to a record $135.4 billion this year, fueled by demand for televisions, a trade association said.

Industry sales will probably rise 8 percent this year after growing a better-than-expected 11 percent in 2005, the Consumer Electronics Association said in a statement. Digital TV sales are poised to grow more than 35 percent and exceed $23 billion, according to the Arlington, Virginia-based group.

Spending on consumer electronics would depend on the employment picture, on which there was good news from Germany yesterday.

The number of people without work, adjusted for usual seasonal swings, fell by 110,000 to 4.64 million, the Federal Labor Agency in Nuremberg said today. That's the biggest monthly drop since German reunification in October 1990, the agency said...

The Berlin-based DIW institute...today raised its forecast for 2006 growth to 1.7 percent from 1.5 percent and said it expects the average unemployment rate to fall by 0.2 percentage points this year.