The Chinese economy continues to slow, with the HSBC Flash China Manufacturing Purchasing Managers’ Index (PMI) contracting for the first time since May. The headline index declined from 50.0 in November to 49.5 in December. New orders (down from 51.3 to 49.6), output (up from 49.6 to 49.7) and employment (up from 48.7 to 48.9) were below 50 – the threshold signifying reduced activity – in December, with production declining for the second straight month. On the positive side, new export orders (up from 51.1 to 51.7) were still growing somewhat modestly. As such, this report suggests that the Chinese economy is ending 2014 much as it began it, with softness in the manufacturing sector. (continue reading…)
USTR Gives India’s Weak IP Policies a Pass
India got a pass when the Office of the U.S. Trade Representative (USTR) dropped its out-of-cycle review of that country’s abysmal IP regime, which consistently ranks as one of the very worst in the world.
The NAM and its partners in the Alliance for Fair Trade with India have long called for concrete action to address the threat of India’s deteriorating intellectual property environment and other discriminatory policies to manufacturing and jobs in the United States. (continue reading…)
The Census Bureau and the U.S. Department of Housing and Urban Development said that housing activity eased somewhat in November. New residential construction starts decreased from a revised 1,045,000 at the annual rate in October to 1,028,000 in November. Despite the slightly decelerated pace, these data continue to show movement in the right direction. To illustrate this, new starts averaged 955,167 in the first half of 2014, but that average has shifted up to 1,032,400 in the five months so far in the second half. (continue reading…)
The Empire State Manufacturing Survey contracted for the first time since January 2013, according to the New York Federal Reserve Bank. The composite index of general business conditions declined from 10.2 in November to -3.6 in December. Indeed, new orders (down from 9.1 to -2.0) and shipments (down from 11.8 to -0.2) both moved lower for the month, with the average employee workweek (down from -7.5 to -11.5) contracting further. Illustrating this shift, the percentage of respondents saying that their orders had increased from the previous month declined from 32.2 percent in November to 23.9 percent in December. (continue reading…)
Manufacturing production was up sharply in November, increasing 1.1 percent after a softer-than-desired autumn. More importantly, production in the sector has risen a relatively healthy 4.8 percent over the past 12 months, suggesting healthy gains over the past year in terms of output. This data tends to mirror other reports, including the latest NAM/IndustryWeek survey, that show manufacturers relatively upbeat about new orders and output as we are about to move into the new year. These stronger gains should bode well for the coming months, we hope, even as business leaders grapple with continuing global economic uncertainties.
Capacity utilization for manufacturers was also higher, up from 77.6 percent in October to 78.4 percent. This was the highest utilization rate since December 2007, the first month of the Great Recession. (continue reading…)
Here is the summary for this week’s Monday Economic Report:
The biggest domestic economic news story last week was actually a global one: The price of petroleum continued to plummet. Since peaking at $107.95 per barrel on June 20, the price of West Texas Intermediate crude has fallen dramatically, down to $57.49 a barrel on Friday. There are a number of factors at play here, including increased North American energy production, excess supply worldwide, a stronger U.S. dollar and a slowing global economy. It is this latter point that has spooked financial markets, on fear that the weakened global demand for petroleum might be a harbinger of larger challenges. Indeed, as discussed in the most recent Global Manufacturing Economic Update, North America’s economy appears to be a bright spot in an otherwise sluggish international economic climate. (continue reading…)
Here are the files for this month’s Global Manufacturing Economic Update:
It has become increasingly clear over the past few weeks that North America stands out as a bright spot in an ever-challenging global economic environment. Real GDP in the United States grew an annualized 4.2 percent in the second and third quarters, and U.S. manufacturers remain mostly optimistic about the next year. Indeed, the U.S. economy is expected to expand by around 3 percent, its fastest rate in a decade. Likewise, Canada and Mexico — our two largest trading partners — have made improvements in their respective economies since earlier this year. Canada has the distinction of having the highest purchasing managers’ index (PMI) of any of our top 10 trading partners, holding steady in November at 55.3. (continue reading…)
The President’s Export Council (PEC) met yesterday at the White House to discuss U.S. policies and programs that promote export expansion. In advance of the meeting, the NAM submitted comments to highlight priority trade issues for manufacturers – including Trade Promotion Authority (TPA), ongoing negotiations for the Trans-Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership (T-TIP), trade facilitation initiatives, WTO negotiations, export control reform and Ex-Im Bank reauthorization. (continue reading…)
Preliminary consumer confidence numbers soared to their highest level since January 2007, according to the University of Michigan and Thomson Reuters. The Consumer Sentiment Index rose from 88.8 in November to 93.8 in December. Measures for the current (up from 102.7 to 105.7) and forward-looking (up from 79.9 to 86.1) economic outlook were both higher for the month. This data suggests that Americans were more upbeat in their assessments of the economy, perhaps boosted by improvements in the labor market and by cheaper gasoline prices. (continue reading…)
Today, the National Labor Relations Board thumbed its nose at businesses and individuals who expressed serious concerns with their proposed rule to shorten the election period for union representation cases and short-circuited employer rights to ensure a fair election. (continue reading…)