In September, US industrial production rose by 0.7% M/M, while the consensus was looking for an increase by 0.2% M/M. Also the previous figure was upwardly revised from 0.8% M/M to 1.2% M/M. Looking at the details, the upward surprise was again based in the manufacturing sector (0.9% M/M) as the “Cash for Clunkers” program supported motor vehicle production (8.1% M/M). Also mining (0.7% M/M) improved, while utilities fell by 0.7% M/M. Excluding vehicles, industrial production rose by 0.4% M/M. In September, industrial production rose for the third consecutive month due to the “Cash for Clunkers” programme. In the coming quarter, it will be interesting to see whether this trend can be sustained when the program expires.
University of Michigan consumer confidence dropped from 73.5 to 69.4 in October, while only a marginal decline was expected. The breakdown shows deterioration in both the economic outlook (67.6 from 73.5) and economic conditions (72.1 from 73.4). The worsening is however no surprise after the sharp rise in the previous month and the deterioration in both ABC and Conference Board’s consumer confidence more recently.
EMU: exports drop the most since January 2009
In August, the euro zone seasonally adjusted trade surplus contracted from a downwardly revised €6.0B to €1.0B, while a surplus of €4.9B was forecasted. Looking at the details, both imports and exports dropped in August, but the decline in exports (-5.8% M/M) was bigger than the drop in imports (-1.3% M/M). The decline in exports was the biggest since January 2009, which indicates that the economic recovery is still fragile and the euro strength might start biting.
