Fellow Shortrunners,

     Happy holidays -- only data analysis this week.

Economic Releases
The data section provides charts and data for the most important economic indicators.

Business Inventories: 0.6%
Release Date: 4/14

• A release from the Commerce Department on Monday suggested that during February, inventories at US businesses edged ahead 0.6%.  A part of the rise could be attributed to continued declines in auto sales.  Overall sales fell as well, dropping 1% during the same period.

Industrial Production: 0.5%
Release Date: 4/15

• During March, industrial production, a measure of the output of US mines, utilities, and factories declined 0.5%.  The only component of the index which were actually health were related to defense spending and the release will be seen by the market as generally negative, which it is.  Capacity utilization, released with industrial production and already slumping, declined to 74.8%, a good sign that the US economy could clearly be making more output. 

Housing Starts: 8.3%
Release Date: 4/16

• In spite of recent signs of weakness in the housing market, US builders are clearly still optimistic about the economy, with the number of new housing projects started during March rising 8.3% over the previous month. 

Consumer Price Index: 0.3%
Release Date: 4/16

• The Bureau of Labor Statistics' Consumer Price Index, the most watched indicator of the price level in the US, rose 0.3% during March.  The core index, which subtracts out food and energy prices because of their volatility was unchanged during the period.  Indeed, as long as we continue to see declining industrial production and capacity utilization I would not expect to see much price pressure.  Given that the run ups in the headline CPI have largely been the result of rising oil prices, we are likely to see the index turn negative in the coming months and thus will probably hear more stories of the dangers of deflation.

Jobless Claims: 442,000
Release Date: 4/17

• It seems that the jobless claims figure simply can't make up its mind.  One week it wants to be really high, indicating strong weakness in the labor market and the next it falls down closer to more normal levels.  This was one of those bad weeks however and initial claims rose as high as 442,000.  A further sign of weakness came in the form of further increases in continuing claims.

Treasury Budget: -$58.7 Billion
Release Date: 4/18

• The Federal Budget is expected to dip into record setting deficits this year, with government outlays up 6.6% on the year and government revenues down almost as much.  Though lower than consensus expectations, the deficit at its current size, will continue to be a topic of conversation for policy makers.

ECRI Weekly Leading Index: 120.5
Release Date: 4/19

• The ECRI Weekly Leading Index rose to 120.5 this week.  The increase brought the 4-week moving average into the positive for the first time in over a month.  The upward swing in a leading index is good news for the economy, though economic recovery may still be dependent upon successful reconstruction in Iraq.

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Issue #149

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