US: Weak eco data
US initial jobless claims dropped slightly from 343K to 339K. However, this outcome failed to meet market expectations for a more pronounced decline after last week??™s sharp upswing that was at leased partially attributed to statistical noise (seasonal adjustment for Easter). Also the continuing claims trended higher again from 2525 K to 2531 K. It is still early day??™s but if this trend is confirmed in the coming week it might suggest that the weakening in the US economy is gradually having some impact on the labour market which proved rather up until now.
The leading indicators rose by 0.1% M/M in March, in line with expectations, following a downwardly revised 0.6% M/M drop in February, earlier reported as ??“0.5% M/M and 0.3% M/M drop in January (earlier ??“0.2% M/M). The Conference Board revised its outlook speaking now of slow growth in the near term, while a month ago slow to moderate growth was projected. In Q1, the leaders fell 0.9% Y/Y, the first negative growth rate since the 2001 recession. Also the widely followed 6-month annualized change slowed, notably to ??“0.3% from 0.3% in February.
The April Philadelphia Fed survey on manufacturing showed an unaltered weak picture of the situation in the manufacturing sector. Basically, activity is at a standstill already for about seven months. The headline, general business expectations, index stabilized at 0.2, below consensus (2) and the sub-indices showed a similar picture. New orders were up 1 point to a weak 2.8, while shipments dropped 2.5 points to 4.3. Unfilled orders and delivery time firmed, but remain deep in negative territory at - 13.7 and ??“11.9 respectively. Inventories were little changed at ??“3.1 and the labour market indices mixed. Employment stabilized at a weak 2.5, but the workweek improved to 5.5 from ??“4.9 previously. Also the price indices were mixed: prices paid rose to 24.3 from 21.8 in March, but prices received fell to 5.2 from 16.3 in March, the lowest since August 2005. This might be an indication that sluggish growth is taking its toll on pricing power.