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Economic Data Roundup

ISM Manufacturing Index 62.8%

Econoday reports: The November ISM manufacturing index soared to a level of 62.8 percent, significantly higher than predicted by economists. This was the highest index level since December 1999 and bodes well for the manufacturing sector. Most major components were above the 50 percent level, including new orders, production, and supplier deliveries. Employment rose to 51.0 in November from 47.7 in October and is finally beginning to reflect increases rather than declines.

Construction Spending +0.9%

Construction expenditures jumped 0.9 percent in October, more than expected by analysts. September's increase was unrevised at 1.3 percent. Residential construction spending continued to post strong gains in October - up a vigorous 2.2 percent after climbing 1.5 percent in September and 2.1 percent in August. Spending is 7.0 percent higher than a year ago. Private nonresidential construction expenditures fell back 2.1 percent after jumping 1.6 percent in September.

3-Month Treasury Bill Rate 0.925%

Econoday reports: The U.S. Treasury auctioned $16.0 billion of 3-month bills at an awarded yield of 0.925 percent, 1/2 basis point below last week's auction. The bid-to-cover ratio was a solid 2.45 vs. 2.46 last week. The 3-month yield has hardly budged despite the rush of strong economic data, reflecting conviction in the Federal Reserve's commitment to keep down overnight interest rates.

6-Month Treasury Bill Rate 1.03%

Econoday reports: The U.S. Treasury auctioned $16.0 billion of 6-month bills at an awarded yield of 1.030 percent, 2.0 basis points above last week's auction. The bid-to-cover ratio was a moderate 2.05 vs. 2.18 last week. The yield on the 6-month bill remains stable and rangebound despite sharply improving economic data, reflecting conviction in the Federal Reserve's commitment to keep down overnight interest rates.

NOTE: Have you noticed the language being used?  Everything is "surging" and now the Fed has a "commitment" to keep overnight rates down?  GAK!  Maybe I was asleep during Economics, but in a recovery and expansion, aren't long rates expected to rise, and therefore, why count the pennies on the short end of the yield curve when in all likelihood, big dollars are about to be lost on the long end?  It must be me...

03.12.01 12:52 #