The US Industrial economy continued higher again last week (if pipeline scheduling is correct), consumption continued to moderate from its recent strength, and the US Federal Reserve finally relented and added some stimulus to the economy... of Europe.The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) climbed for the seventh time in the last eight weeks, rising to 122.0 (vs last weeks 121.0, its highest reading since June 24th. In its raw dailies (above), the measure was only slightly soft for the Thanksgiving holiday weekend, strengthened slightly midweek, then re-softened a tad late. Taking seasonals into account, the week was firm.
The Consumption Index looked like a stock in "Profit-Taking" mode, giving back a little more of its previously-robust gains (2nd off-week in a row). The measure backed off to 135.2 (from last weeks 137.0). In its dailies the measure started the week soft but firmed over the Thanksgiving holiday period.
The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index), continued its long-term decline.
Data quality within the gas-flows was a little off, with the significant California utility PG&E's web-site down along
For the time being, the economy remains supported by firmness in industrial (factory) natgas-scheduling, the recently-widened gap between the production and consumption indexes, and perhaps a bit less pessimism in the deeply-pessimistic US industrial sector.
Concern remains for the recent softness in the consumption index, and a somewhat bearish restrengthening of food-group scheduling (indicative of declining consumer confidence). Federal Reserve policy still appears hawkish (allowing liquidity to drain from the US, in spite of last weeks generosity to Europe), theoretically capping economic expansion and questioning the sustainability of the recent economic advance.
Corporate profitability still looks to be solid (so far) for the 4th quarter, and given the caution in the business sector, should surprise on the upside for many quarters to come... as long as business-caution persists.
-Robry825
