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Monday, June 01, 2009


new orders turn up

calculated risk provided an overview of today's ISM manufacturing report for may, but ed harrison highlighted the greening of some of the report's internal aspects:

The key to the ‘beat’ was new orders, which rose from 47.2 in April to 51.1. That says that new orders in the manufacturing sector are growing for the first time in 18 months. You should also notice that customers’ inventories are moving in a big way as well, with that number registering too low and the contraction of inventories actually accelerating. Translation: the much fabled de-stocking of inventories is gathering pace, setting the stage for inventories to make a positive contribution to GDP by Q3. You should see these two trends as leading indicators for a recovery because they are the first two sub-indices to switch direction in this incipient bottoming process. You should also notice that the overall economy is also now growing according to this index.

a blip? a nascent cyclical upturn? hard to say.

CR also highlights the weak april consumer income report.

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