How Supply Managers See Business
Staff -- Purchasing, 11/3/2005
- Hurricanes Katrina and Rita likely won't trigger a recession in the U.S. economy, but they could slow the economy enough to make it feel like one, says Ken Goldstein, chief economist for the Conference Board research group. Stronger growth should return in 2006, assuming the Federal Reserve doesn't raise rates past 4% and energy prices don't spike even higher.
- U.S. gross domestic product is expected to increase 3.3% in 2006 after an expected 3.5% gain in 2005, says the latest consensus forecast by Blue Chip Economic Indicators. The participating economists expect the consumer price index to rise 2.9% in 2006 after an expected 3.3% rise in 2005.
- U.S. consumer sentiment index tracked by the University of Michigan fell in early October to 75.4, the lowest level in 13 years. High gasoline prices and economic fallout from hurricane damage took their toll, dropping the consumer sentiment reading below the 76.9 of September.
- September's seasonally adjusted annual sales rate of 16.3 million motor vehicles lagged the summer's torrid pace of 16.7 million, setting the stage for what Wall Street sees as a tough stretch toward the end of the year. U.S. auto sales had been 17.5 million a year ago.
- The quarterly Manufacturers Alliance/MAPI survey sees expanded manufacturing in the fourth quarter; however, the tea leaves suggest a slower pace than was expected earlier. The latest composite index showed only a slight decline in September, falling to 66 after a reading of 68 in June.
- The federal deficit fell to $319 billion in fiscal 2005 that ended Sept. 30, down from $413 billion the previous year, the Treasury Department reports. The fiscal 2005 deficit equaled 2.6% of gross domestic product. Treasury Secretary John Snow says the reduced deficit reflects "a growing economy that has swelled tax revenues over the last year." Caveat: Private economists argue that the improved receipts may not be sustainable in a shrinking economy, saying that the budget will show a higher deficit in fiscal 2006.
- Looking for the latest reports on delivery leadtimes of industrial commodities or packaging materials? They're available at www.purchasingdata.com. This is PURCHASING's online proprietary source for transaction prices, leadtimes, and other monthly business indicators covering for 150 key commodities.
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