US: NY Fed manufacturing index rebounds sharply

In November, US CPI inflation rose by 0.1% M/M, while the annual figure dropped
from 1.2% Y/Y to 1.1% Y/Y, in line with expectations. The details show that price increases were widespread as energy (0.2% M/M), food and beverages (0.2% M/M),
apparel (0.2% M/M), transportation (0.3% M/M), medical care (0.1% M/M), education
& communication (0.1% M/M) other goods and services (0.3% M/M) and commodities (0.1% M/M) all became more expensive. Prices of housing and recreation stabilized in November. Core CPI, on the contrary rose from record low levels last month
(0.6% Y/Y) to 0.8% Y/Y, while a stable outcome was expected. Although core CPI
surprised on the upside of expectations, the inflation data were still rather
close to expectations and confirm that inflationary pressures remain very
muted.

The NY Fed manufacturing index rose from -11.14 to 10.57 in December, beating
market expectations and almost reversing the awful losses from the previous month.
The breakdown shows, however, a more mixed picture. New orders (2.60 from -
24.38) and shipments (7.11 from -6.12) rose sharply and also delivery time (-6.82
from -9.09) and unfilled orders (-18.18 from -24.68) improved in December. Inventories (-15.91 from 0.00), number of employees (-3.41 from 9.09) and average workweek (-14.77 from -12.99), on  the contrary, deteriorated. Price pressures increased
as prices paid rose from 22.08 to 28.41 and prices received increased from -2.60 to
3.41. The forward looking index dropped slightly from 54.55 to 48.86. The rebound
in the NY Fed index is an encouraging sign and indicates that last month’s
plunge was only temporary, although the index is very volatile and often conflicts with the other business confidence indicators.

US industrial production rose by 0.4% M/M in November, slightly more than expected, while the previous figure was downwardly revised from 0.0% M/M to -0.2% M/M. The details show an 0.3% M/M increase in manufacturing as production of machinery rose by 1.2% M/M and computers increased by 1.1% M/M, while motor vehicles and parts dropped sharply (-6.0% M/M). Also utilities rebounded (by 1.9% M/M) after a 3.7% M/M plunge due to unusual mild weather in October. Mining dropped slightly (by 0.1% M/M). Also capacity utilization surprised slightly on the upside of expectations rising from 74.9% to 75.2%. Industrial production rose in November at its fastest pace since July which indicates that production will probably continue to support growth in the fourth quarter.

EMU: employment stabilized in the third quarter 
The  number of people employed in the euro zone remained stable in the third
quarter of 2010, compared with the previous quarter, while the second quarter figure
was upwardly revised from 0.0% Q/Q to 0.1% Q/Q. The details show that employment dropped in construction (-1.1% Q/Q), manufacturing (-0.3% Q/Q) and agriculture (-0.2% Q/Q), while employment rose  in financial services & business activities (0.3% Q/Q) other services (0.2% Q/Q) and trade, transport and communication services (0.1% Q/Q). Compared with the same period last year, employment fell by
0.2% Y/Y. Also in employment data, there is a remarkable difference between
countries as in Germany (0.3% Q/Q), France (0.2% Q/Q) and for example Belgium
(0.3% Q/Q), where employment started to pick up, while in Spain (-0.7% Q/Q),
Greece (-0.7% Q/Q) and Portugal (-0.4% Q/Q) companies continued to cut jobs.
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