US: CHICAGO FED NAT. ACTIVITY INDICATOR SUGGESTS MORE ECO WEAKNESS
The Chicago National Activity Indicator continues to point to economic weakness. The index rose marginally to –0.31 from an upwardly revised –0.51 in September. However, the less volatile 3 month moving average slid to –0.19 from –0.15 in September. Values below zero point to below trend growth and to few inflationary pressures in the year ahead. We are closely watching this indicator as values below –0.70 indicate that chances a recession has started exceed 70%. The Chicago Fed Activity Indicator has little market moving potential though, as it simply aggregates a high number of other, already published data. .
OTHER NEWS: STRONG CBI INDUSTRIAL TRENDS
The CBI Industrial Trends survey showed an improving picture as especially export orders soar. Indeed, the total orders balance rose to –6 in November from –20 in October, driven by a jump in the export orders balance to +3 from –11 previously. Output expectations eased to 5 from 9 and average price expectations rose to 19 from 12. The latter development will certainly be looked at with worry in BoE circles, as it shows capacity pressures are starting to affect prices. .
