This week manufacturing and some important data long delayed by the government shutdown will be in the spotlight.

First, manufacturing: as the below graph of ISM manufacturing and new orders shows, in the last 8 months, manufacturing has slowed from white hot expansion to just weakly positive:

As of last Friday, the rolling average for new orders in the five Fed regional indexes was just +1 above completely stalled — it had been as high as +28 in spring 2018!

Between today and Thursday, three remaining Fed regions — Richmond, Kansas City, and Dallas— will report their February manufacturing indexes. Also on Thursday, the Chicago PMI gets published. That one has been the most positive of any region for the past year.  Finally, on Friday ISM publishes its national February manufacturing report.

It’s possible that by the end of this week we will have evidence that manufacturing is in outright contraction. We’ll see.

Meanwhile, data on three long leading indicators — building permits, residential investment, and proprietors’ income — that have been delayed by as long as two months, finally get reported, on Tuesday (permits for December) and Thursday (as part of the Q4 GDP report).

A couple of weeks ago I went ahead and made a “preliminary” forecast for the second half of 2019, using substitutes for this data, that included me going on “Recession Watch” for Q4 of this year. The missing data, once reported, could either consolidate or alleviate that forecast.