Showing posts with label Economic Indicators. Show all posts
Showing posts with label Economic Indicators. Show all posts

Wednesday, November 10, 2010

Pulse of Commerce Index

Here is another Leading Indicator in which tracks US Economy.
 The Ceridian-UCLA Pulse of Commerce Index™ is based on real-time diesel fuel consumption data for over the road trucking and serves as an indicator of the state and possible future direction of the U.S. economy. By tracking the volume and location of fuel being purchased, the index closely monitors the over the road movement of raw materials, goods-in-process and finished goods to U.S. factories, retailers and consumers.
October Month report signals economy is not going in right direction for now.
 Here is the October Report.

The Ceridian-UCLA Pulse of Commerce Index™ (PCI) by the UCLA Anderson School of Management, adjusted for season and for monthly workdays, fell 0.6% in October following a decline of 0.5% in September and a decline of 1.0% in August, which was the first three consecutive months of decline since January 2009, when we were still deep in recession

October is especially important because it is the peak month for holiday shipping, with a seasonal factor of 1.029 compared with 0.978 in November and 0.941 for December. The October decline in the PCI can be summarized in a single word: worry. Worry about the strength of sales in the holiday period has apparently caused a slowdown in trucking in October which might be only a postponement to November if consumers show a little more exuberance.

The PCI this month is disappointing because the growth in the economy in the first three quarters of this year if sustained would have made the holiday even better.The declines in the PCI in the last three months suggest further slowing of growth of industrial production.

There is a one to one relationship of GDP and IIP with PCI and also  PCI report comes before IIP and GDP report . Looks PCI is a Good indicator to keep Track in future

Friday, October 22, 2010

HSBC India Services PMI-Economic Indicator

 About the PMIs
Purchasing Managers’ Indices (PMIs) have been specially developed to provide economic analysts, purchasing professionals, business decision-makers and policy makers with accurate and timely data to help better understand business conditions. In particular:
  • central banks in many countries use the data to help make interest rate decisions;
  • analysts in the financial markets use PMI data to reliably forecast official data such as GDP;
  • forecasters and planners in the corporate sector use the PMIs to help anticipate changing business conditions and to benchmark performance.
The indices are based on monthly questionnaire surveys of carefully selected companies which provide an advance indication of what is really happening in the private sector economy by tracking changes in variables such as output, new orders, stock levels, employment and prices across the manufacturing, construction, retail and service sectors.

The HSBC India Services PMI is based on data compiled from monthly replies to questionnaires sent to purchasing executives in around 350 private service sector companies.

The HSBC India Composite PMI is a weighted average of the Manufacturing Output Index and the Services Business Activity Index, and is based on original survey data collected from a representative panel of over 800 companies based in the Indian manufacturing and service sectors.

Survey responses reflect the change, if any, in the current month compared to the previous month based on data collected mid-month. For each of the indicators the ‘Report' shows the percentage reporting each response, the net difference between the number of higher/better responses and lower/worse responses, and the ‘diffusion' index. This index is the sum of the positive responses plus a half of those responding ‘the same'.

Diffusion indexes have the properties of leading indicators and are convenient summary measures showing the prevailing direction of change. An index reading above 50 indicates an overall increase in that variable, below 50 an overall decrease.

October Month PMI report

Growth of activity in the Indian private sector economy slowed to weakest pace in
ten months in September
India's service industry is stepping off the throttle. Along with the manufacturing sector, growth is slowing, although the expansion continues. Price pressures, however, have not eased meaningfully, which represents a challenge for the central bank. The pace of hiring has slowed as well,even if it remains in positive territory. All this suggests a mild easing of demand growth since the red-hot pace earlier this year, but is hardly enough to relax the guard on inflation. Monetary officials may still need to tighten further to avert price pressure from becoming entrenched
It shows the growth which happened from the start of this year is slowing a bit and next month report will give a confirmation for this trend.With the Hot money coming into India it will be tough task for RBI to maintain exchange rate ,interest rate and inflation all Hitting at the same time .

Thursday, October 21, 2010

What is Beige Book

There is economic indicator called Beige Book.It is a  report published eight times per year and Two Wednesdays before every Federal Open Market Committee (FOMC) meeting.

Each Federal Reserve Bank gathers informal information on current economic conditions in its District through reports from Bank and Branch directors and interviews with key business contacts, economists, market experts, and other sources. The Beige Book summarizes this information by District and sector. An overall summary of the twelve district reports is prepared by a designated Federal Reserve Bank on a rotating basis.

The Beige Book report is a lagging indicator, in that it is a report of what already happened in the districts, not what the Fed Districts think is going to happen. On the other hand, many economists consider it a leading indicator, in that it could get the Fed to change the Fed Funds rate which is, in itself, a leading indicator

Reports from the twelve Federal Reserve Districts suggest that, on balance, national economic activity continued to rise, albeit at a modest pace, during the reporting period from September to early October
 Latest beigebook

The Beige Book aims to give to give a broad overview of the economy, bringing many variables and indicators into the mix. Discussion will be about things such as labor markets, wage and price pressures, retail and ecommerce activity and manufacturing output. Investors can see comments that are forward-looking; the Beige Book will contain comments that look to predict trends and anticipate changes over the next few months or quarters.

More can be found at this location: