New York Fed, Philly Fed See Stronger Than Expected Manufacturing Numbers
(Kitco News) - It’s not just the U.S. consumer that is doing better than expected the face of growing recession fears. Regional manufacturing data from the Philadelphia Federal Reserve and the New York Federal Reserve shows resilient strength in the manufacturing sector.
Thursday, the Philly Fed said that its manufacturing business outlook survey dropped less than expected to a reading of 16.8, down July’s reading of 21.8. However, economists were expecting to see a much sharper drop to 10.0.
At the same time the New York Fed said that its Empire State survey rose to 4.8, up modestly from July’s reading of 4.3. Economists had expecting to see a reading of 2.1.
The stronger than expected manufacturing data came at the same time as U.S. retail sales report, which saw an increase 0.7% in July significantly beating expectations for a 0.4% increase.
Avery Shenfeld, senior economist at CIBC, said that he was surprised that bond yields haven’t pushed materially higher in reaction to the better than expected data.
“All told, a mix of data that should be negative for fixed income and supportive for the USD, but we have seen a puzzling lack of reaction thus far,” he said.
The better-than-expected data is creating some modest selling pressure for gold but so far prices have managed to hold critical support above $1,500 an ounce. December gold futures last traded at $1,521.50 an ounce, down 0.41% on the day.