Mixed U.S. data likely after release of GDP

imperialfxonline

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Jan 12, 2010
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Coming on the heels of the release of U.S. preliminary Q4 GDP data at 13:30GMT (for which no change is expected for the advance estimate of 5.7%) will be the batch of data due out between 14:45-15:00GMT, starting with the Chicago PMI and to be followed by the University of Michigan consumer sentiment index and then existing home sales.

Economists forecast the February Chicago PMI to drop to 59.3 from the reading of 61.5 in January (which happened to the highest since November 2009), signaling a pause in the index’s steady rise since May 2009. The 50 level which is the threshold dividing economic contraction and expansion was crossed in October when the index increased from 46.0 to 53.2.

Even with a pause in the Chicago PMI’s uptrend, the stronger-than-expected rise in the ISM manufacturing and Empire State manufacturing figures released earlier this month are pointing further strength going into March and the second quarter of 2010.

The University of Michigan’s consumer sentiment index will probably see the preliminary figure of 73.7 revised upwards to 73.9, representing an improvement in the expectations component (from the original of 66.9). Analysts were wrong-footed on the release of the preliminary number, which was below their forecast of a jump to 75.0 from the January result of 74.4 (highest since January 2008). The index has risen from a trough of 67.4 seen in November.

Finally, after a sharp fall of 16.7% in December, U.S. existing home sales should have increased by around 0.9% to 5.50 million units from 5.45 million units. The decline in December was due to the surge in the few months leading up to the deadline for tax breaks for first time buyers (the recent peak was November’s number of 6.54 million).


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