Weekly Market Pulse

This is a holiday-shortened week in the US but there is some important data on tap.

Retail sales are expected to show a month-to-month rise for the first time since September. Year over year numbers remain pretty subdued and likely will until life returns to something resembling normal.

Producer prices will likely rise but inflation continues its benign ways. It is likely we’ll see prices surge on a year over year basis later in the spring but that will just be a base effect from when prices were falling at the onset of the virus last year.

Industrial production has been in a steady uptrend since hitting bottom last April and this report will probably show more of the same. In fact, if I had to pick a report that might provide a positive surprise it is this one. The production side of the economy is actually in decent shape.

Housing has been a bright spot but housing starts and existing home sales are both expected to moderate in this week’s reports. 

(Click on image to enlarge)

Last week’s reports were light and about as expected. The JOLTS report was right in the middle of meh. Job openings were up on the month and year over year. But Quits and Hires are both down considerably over the last year (over 6% for each). The jobs market is, at best, in a holding pattern as employers – and I suspect potential employees – continue to await the end of the virus. 

Inflation expectations are rising as nominal bond yields rise and real yields tread underwater but the CPI confirmed the lack of actual inflation, at least for now. I am not sure at all how things will look six months or a year from now but bond traders sure seem to think they do.

Wholesale inventories continued to creep up with sales; the inventory/sales ratio remains stable at 1.31, a relatively low number.

Finally, I included the German industrial production report which I found surprisingly strong considering the degree of shutdown in Europe. 

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Disclosure: This material has been distributed for informational purposes only. It is the opinion of the author and should not be considered as investment advice or a recommendation of any ...

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