The US Industrial economy continued to strengthen again last week (if pipeline scheduling is correct), while consumption continued to moderate from its recent strength.The Production Index (In terms of its 28-day moving average of gas-flow scheduling into US industrial facilities) climbed for the 8th time in the last 9 weeks, rising to 122.6 (vs last weeks 122.0, its highest reading since June 21st. In its raw dailies (above), the measure started modestly soft the first half of the week, then firmed.
The Consumption Index continued its retreat from previously-robust gains (3nd off-week in a row). The measure declined to 133.3 (from last weeks 135.2). In its dailies the measure started the week soft but firmed late.
The Inventories measure (the cumulative weekly difference between the Production Index and the Consumption Index), continued its long-term decline.
For the time being, the economy remains somewhat supported by firmness in industrial (factory) natgas-scheduling, the remaining gap between production and consumption, and the late-week strengthening to both indexes... with good evidence of the turn to recovery evidenced in steel scheduling (evidence of the beginnings of a durable-goods recovery), along with automotive scheduling.
Concern remains for the recent softness in the consumption index, and recent hawkishness in Federal Reserve policy enabling further liquidity-drains from the US, 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.
-Robry825
