Economy

Economic Data Roundup (12/30/2016)

12/30/16 12:00 PM

iStock_000009003675_Small.jpgThe Chicago purchasing managers’ index (PMI) from Market News International (MNI), a measure of regional business activity that is often viewed as an indicator for the overall U.S. economy, fell to 54.6 in December. Some pullback was to be expected following November’s post-election spike but the decline this month was much larger than anticipated. Most of the weakness in the headline index was due to a large slowdown in new orders and production growth, and the inventories gauge also dipped back into contraction territory in December. Several surveyed managers this month reported that the prices of “metals, plastics, and transportation costs” were all increasing (inflation), hinting at an additional strain on margins. However, the headline index is still near the best level of the past two years, as reported optimism about future business activity remains elevated. An economist at MNI added that “Most respondents to our survey remain upbeat about the fate of their business as we head into 2017, buoyed by fresh hope of better things to come under the new administration. Hopefully, 2017 can build on the momentum generated in the latter stages of 2016.” Surveyed managers this month were also asked a special question about how they expect the new administration’s policies to impact their business in 2017. A majority of respondents believe that their firm will prosper in the new year as a result of the anticipated “tax reform and deregulation,” while 40 percent expect the new regime to have no impact on their operations. Only 9 percent of managers anticipate a negative business impact.

u4656511546.jpg

 


 

Sources: Econoday, Bloomberg, ZH, MNI, ISM, FRBSL

Post author: Charles Couch