A key manufacturing index shows the US remains in contraction territory

Manufacturing activity continued to lag in November amid a lag in inventories and new orders, according to the latest ISM Manufacturing reading released Monday. Though the ISM reading is usually reported as a simple number, it actually denotes the percentage of manufacturers planning to expand operations. The report shows that manufacturing “is stuck in a mild recession with little prospect of a real near-term revival. In a related release, the Markit manufacturing reading, known as the Purchasi


Manufacturing activity continued to lag in November amid a lag in inventories and new orders, according to the latest ISM Manufacturing reading released Monday.
Though the ISM reading is usually reported as a simple number, it actually denotes the percentage of manufacturers planning to expand operations.
The report shows that manufacturing “is stuck in a mild recession with little prospect of a real near-term revival.
In a related release, the Markit manufacturing reading, known as the Purchasi
A key manufacturing index shows the US remains in contraction territory Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-12-02  Authors: jeff cox
Keywords: news, cnbc, companies, growth, reliable, points, expansion, territory, contraction, orders, manufacturing, reading, report, key, ism, remains, trade, index, shows


A key manufacturing index shows the US remains in contraction territory

Manufacturing activity continued to lag in November amid a lag in inventories and new orders, according to the latest ISM Manufacturing reading released Monday.

The reading came in at 48.1 vs. an expectation of 49.4 and the previous month’s reading of 48.3.

Though the ISM reading is usually reported as a simple number, it actually denotes the percentage of manufacturers planning to expand operations. A reading below 50 represents contraction; November was the fourth straight month below the expansion level.

Stocks fell on the report, with the Dow Jones Industrial Average off more than 150 points at 10:30 am ET.

New orders slumped to 47.2, down 1.9 percentage points from October’s 49.1. Inventories, which are a key input for gross domestic product, came in at 45.5, down 3.4 points from the previous month.

The numbers come amid speculation about the pace of U.S. growth.

Recession worries have ebbed from earlier in the year, when the Treasury yield curve was inverted and flashing what has been a reliable 12-month recession indicator for the past 50 years. GDP growth has averaged around 2.4% in 2019, with the third quarter coming in at 2.1%. However, most forecasters expect the fourth quarter to come in under 2%.

The report shows that manufacturing “is stuck in a mild recession with little prospect of a real near-term revival. This will weigh on job growth and capex over the next few months, to the point where we are not ready to rule out a further [Federal Reserve] easing in January,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, said in a note.

Manufacturing is considered a reliable bellwether for how the rest of the economy is doing, though it comprises only about one-fifth of GDP.

Nearly all of the key ISM indicators were at contraction levels in November.

Employment was at 46.6, down 1.1 point for the month, while export orders fell 2.5 points to 47.9 as the U.S. and China continue to look for a resolution to a trade dispute that began more than a year and a half ago.

Supplier deliveries was one of the few metrics in expansion, rising 2.5 points to 52.

In a related release, the Markit manufacturing reading, known as the Purchasing Managers Index, indicated expansion, coming in at 52.6, just above expectations and a bit better than the 51.3 October reading.

The Markit PMI growth reflected an uptick in production and new orders as well as strength in employment indicators. It was the strongest reading in seven months.

Investors will get a close look Friday at the impact the manufacturing slowdown and trade war have had on the broader economy. The Labor Department’s nonfarm payrolls report comes down that day, with economists surveyed by Dow Jones expecting a sharp rebound in growth to 187,000 from November’s 128,000.


Company: cnbc, Activity: cnbc, Date: 2019-12-02  Authors: jeff cox
Keywords: news, cnbc, companies, growth, reliable, points, expansion, territory, contraction, orders, manufacturing, reading, report, key, ism, remains, trade, index, shows


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The lagging manufacturing sector may be about to rebound, according to a reliable indicator

Manufacturing activity has been contracting since the summer, according to the widely watched ISM manufacturing index, but that may be about to change. Natixis economist Joseph LaVorgna said the performance of semiconductor stocks has diverged sharply from the ISM recently, with the PHLX Semiconductor sector index (SOX) springing higher, while the ISM continues to point lower. Source: NatixisBank of America Merrill Lynch strategists also pointed to the rising SOX index as a signal that manufactu


Manufacturing activity has been contracting since the summer, according to the widely watched ISM manufacturing index, but that may be about to change.
Natixis economist Joseph LaVorgna said the performance of semiconductor stocks has diverged sharply from the ISM recently, with the PHLX Semiconductor sector index (SOX) springing higher, while the ISM continues to point lower.
Source: NatixisBank of America Merrill Lynch strategists also pointed to the rising SOX index as a signal that manufactu
The lagging manufacturing sector may be about to rebound, according to a reliable indicator Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-11-13  Authors: patti domm
Keywords: news, cnbc, companies, contraction, stocks, ism, sector, manufacturing, semiconductor, lagging, rebound, reliable, index, indicator, sox, according, lavorgna


The lagging manufacturing sector may be about to rebound, according to a reliable indicator

Chip stocks may be pointing the way to a rebound in the manufacturing economy.

Manufacturing activity has been contracting since the summer, according to the widely watched ISM manufacturing index, but that may be about to change.

Natixis economist Joseph LaVorgna said the performance of semiconductor stocks has diverged sharply from the ISM recently, with the PHLX Semiconductor sector index (SOX) springing higher, while the ISM continues to point lower. Typically the two move in tandem, and the divergence is unusual.

“There’s a massive gap between the two. … It suggests there should be some upside in the ISM,” he said. Chip manufacturers are economically sensitive, and they can improve and decline ahead of other sectors.

Source: Natixis

Bank of America Merrill Lynch strategists also pointed to the rising SOX index as a signal that manufacturing may be on the cusp of a rebound. “We are bullish macro,” they wrote. They said the surge in the SOX implies the ISM manufacturing index should be at a level greater than 55 over the next three months.

“These manufacturing cycles tend to be self-correcting. I’m guessing the sector self-corrects. The rest of the economy looks OK,” said LaVorgna, chief economist of the Americas. “Unless it leads to layoffs, which it hasn’t, it’s going to burn itself out.”

ISM manufacturing for October was 48.9, in contraction for a third month but improved over the 48.3 in September. Anything below 50 signals contraction. The November report is expected Dec. 2.

LaVorgna said he’s become convinced that the malaise in manufacturing will be short-lived since it is showing no sign of spreading into other parts of the economy. Manufacturing is also cyclical, and periods of contraction are normal during long business cycles, he said.

Source: Natixis


Company: cnbc, Activity: cnbc, Date: 2019-11-13  Authors: patti domm
Keywords: news, cnbc, companies, contraction, stocks, ism, sector, manufacturing, semiconductor, lagging, rebound, reliable, index, indicator, sox, according, lavorgna


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The lagging manufacturing sector may be about to rebound, according to a reliable indicator

Manufacturing activity has been contracting since the summer, according to the widely watched ISM manufacturing index, but that may be about to change. Natixis economist Joseph LaVorgna said the performance of semiconductor stocks has diverged sharply from the ISM recently, with the PHLX Semiconductor sector index (SOX) springing higher, while the ISM continues to point lower. Source: NatixisBank of America Merrill Lynch strategists also pointed to the rising SOX index as a signal that manufactu


Manufacturing activity has been contracting since the summer, according to the widely watched ISM manufacturing index, but that may be about to change.
Natixis economist Joseph LaVorgna said the performance of semiconductor stocks has diverged sharply from the ISM recently, with the PHLX Semiconductor sector index (SOX) springing higher, while the ISM continues to point lower.
Source: NatixisBank of America Merrill Lynch strategists also pointed to the rising SOX index as a signal that manufactu
The lagging manufacturing sector may be about to rebound, according to a reliable indicator Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-11-13  Authors: patti domm
Keywords: news, cnbc, companies, contraction, stocks, ism, sector, manufacturing, semiconductor, lagging, rebound, reliable, index, indicator, sox, according, lavorgna


The lagging manufacturing sector may be about to rebound, according to a reliable indicator

Chip stocks may be pointing the way to a rebound in the manufacturing economy.

Manufacturing activity has been contracting since the summer, according to the widely watched ISM manufacturing index, but that may be about to change.

Natixis economist Joseph LaVorgna said the performance of semiconductor stocks has diverged sharply from the ISM recently, with the PHLX Semiconductor sector index (SOX) springing higher, while the ISM continues to point lower. Typically the two move in tandem, and the divergence is unusual.

“There’s a massive gap between the two. … It suggests there should be some upside in the ISM,” he said. Chip manufacturers are economically sensitive, and they can improve and decline ahead of other sectors.

Source: Natixis

Bank of America Merrill Lynch strategists also pointed to the rising SOX index as a signal that manufacturing may be on the cusp of a rebound. “We are bullish macro,” they wrote. They said the surge in the SOX implies the ISM manufacturing index should be at a level greater than 55 over the next three months.

“These manufacturing cycles tend to be self-correcting. I’m guessing the sector self-corrects. The rest of the economy looks OK,” said LaVorgna, chief economist of the Americas. “Unless it leads to layoffs, which it hasn’t, it’s going to burn itself out.”

ISM manufacturing for October was 48.9, in contraction for a third month but improved over the 48.3 in September. Anything below 50 signals contraction. The November report is expected Dec. 2.

LaVorgna said he’s become convinced that the malaise in manufacturing will be short-lived since it is showing no sign of spreading into other parts of the economy. Manufacturing is also cyclical, and periods of contraction are normal during long business cycles, he said.

Source: Natixis


Company: cnbc, Activity: cnbc, Date: 2019-11-13  Authors: patti domm
Keywords: news, cnbc, companies, contraction, stocks, ism, sector, manufacturing, semiconductor, lagging, rebound, reliable, index, indicator, sox, according, lavorgna


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ISM manufacturing index October 2019

A gauge of U.S. manufacturing showed the sector continued to contract in October, the third straight month of slowdown amid global trade uncertainties. The purchasing manufacturing index from the Institute for Supply Management came in at 48.3% last month, compared with a 47.8% reading in September. The sector showed its first contraction in a few years in August, ending a 35-month expansion period where the PMI averaged 56.5%, according to ISM. The backlog of orders index was 44.1%, contracting


A gauge of U.S. manufacturing showed the sector continued to contract in October, the third straight month of slowdown amid global trade uncertainties.
The purchasing manufacturing index from the Institute for Supply Management came in at 48.3% last month, compared with a 47.8% reading in September.
The sector showed its first contraction in a few years in August, ending a 35-month expansion period where the PMI averaged 56.5%, according to ISM.
The backlog of orders index was 44.1%, contracting
ISM manufacturing index October 2019 Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-11-01  Authors: yun li, jeff cox
Keywords: news, cnbc, companies, ism, contraction, manufacturing, month, showed, index, 2019, sector, trade, inventories, orders, reading


ISM manufacturing index October 2019

A man using an angle grinder on a steel piece at a metal fabrication company on August 7, 2018 in Orange County, New York.

A gauge of U.S. manufacturing showed the sector continued to contract in October, the third straight month of slowdown amid global trade uncertainties.

The purchasing manufacturing index from the Institute for Supply Management came in at 48.3% last month, compared with a 47.8% reading in September. But it was below economists’ expectations of 49.1%. A number below 50% represents a contraction in the industry.

The sector showed its first contraction in a few years in August, ending a 35-month expansion period where the PMI averaged 56.5%, according to ISM. The manufacturing gauge had its lowest reading since June 2009 in September as exports dived amid the escalated trade war.

The continuing contraction showed the challenging environment U.S. manufacturers are faced with amid the escalated trade war between the U.S. and China. Manufacturing was once considered a big winner under the Trump administration with improvements in employment and activity over the past few years.

“Comments from the panel reflect an improvement from the prior month, but sentiment remains more cautious than optimistic,” Timothy Fiore, chair of the ISM Manufacturing Business Survey Committee, said in a statement.

The production index was only 46.2% in October, compared to the September reading of 47.3%. The backlog of orders index was 44.1%, contracting for the sixth straight month, versus the September reading of 45.1%, according to ISM.

Prices decreased for the fifth consecutive month and at a faster rate with the prices index registered 45.5% in October.

“Inputs — expressed as supplier deliveries, inventories and imports — were again lower in October, due primarily to supplier delivery contraction offset by improvements in inventories,” Fiore said.

However, the latest report also showed signs of recovery, making some on Wall Street believe the manufacturing slowdown won’t be accelerating. New orders, employment and inventories all showed improvement last month.

“The outlook for nation’s factories isn’t growing any worse and the manufacturing recession isn’t intensifying,” Chris Rupkey, chief financial economist at MUFG, said in a note. “There are even some green shoots for the manufacturing sector as orders are picking up and orders lead the way forward for production and output and jobs.”


Company: cnbc, Activity: cnbc, Date: 2019-11-01  Authors: yun li, jeff cox
Keywords: news, cnbc, companies, ism, contraction, manufacturing, month, showed, index, 2019, sector, trade, inventories, orders, reading


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Major contraction in Iran is driving the Middle East’s growth slowdown: IMF report

Workers cross walkways between zones aboard an offshore oil platform in the Persian Gulf’s Salman Oil Field, near Lavan island, Iran, on Jan. 5. “The outlook for the MCD region (Middle East and Central Asia) is driven by a large contraction in Iran in the short-term followed by a rebound in 2020,” the report said. Broader international factors are also impacting the region’s growth, the report said. “For the oil exporting countries, non-oil growth is gradually picking up thanks to the reforms th


Workers cross walkways between zones aboard an offshore oil platform in the Persian Gulf’s Salman Oil Field, near Lavan island, Iran, on Jan. 5.
“The outlook for the MCD region (Middle East and Central Asia) is driven by a large contraction in Iran in the short-term followed by a rebound in 2020,” the report said.
Broader international factors are also impacting the region’s growth, the report said.
“For the oil exporting countries, non-oil growth is gradually picking up thanks to the reforms th
Major contraction in Iran is driving the Middle East’s growth slowdown: IMF report Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-10-28  Authors: natasha turak
Keywords: news, cnbc, companies, easts, major, growth, region, report, factors, middle, imf, outlook, driving, iran, oil, contraction, sanctions, east, slowdown


Major contraction in Iran is driving the Middle East's growth slowdown: IMF report

Workers cross walkways between zones aboard an offshore oil platform in the Persian Gulf’s Salman Oil Field, near Lavan island, Iran, on Jan. 5. 2017.

The International Monetary Fund’s latest regional outlook report for the Middle East and Central Asia, published Monday, paints a picture of uncertain economies weighed down by global factors like trade tensions as well as internal and regional turmoil.

Trade wars, oil price volatility, the risk of a disorderly Brexit and rising social unrest — and in the short term, a massive economic contraction in Iran as it buckles under heavy U.S. sanctions — are the biggest factors shaping the region’s outlook, according to the IMF.

“The outlook for the MCD region (Middle East and Central Asia) is driven by a large contraction in Iran in the short-term followed by a rebound in 2020,” the report said. “The risks around the forecast are skewed to the downside and are highly dependent on global factors.”

The IMF expects Iran to have a fiscal deficit of 4.5% in 2019 and 5.1% in 2020, and projects its growth to contract by a whopping 9.5% this year. The country of 80 million and third-largest OPEC producer has seen its currency go into free fall and inflation approach 40% after being hit by wide-ranging sanctions following the Trump administration’s withdrawal from the 2015 Iranian nuclear deal. The sanctions have slashed Iran’s crude exports by about 80%, according to Reuters estimates.

Broader international factors are also impacting the region’s growth, the report said.

“The region is this year growing at a slower pace than last year. And this is due to the various shocks or factors that are affecting the output of the region,” Jihad Azour, the IMF’s director for the Middle East and Central Asia, told CNBC’s Hadley Gamble in Dubai.

Azour said that oil importing countries should expect a growth slowdown from 4.3% to 3.6%, mainly driven by Pakistan and Sudan, while oil exporters — excluding Iran and countries impacted by war — should expect growth of 1.3% in 2019 compared to 1.6% the year before.

“For the oil exporting countries, non-oil growth is gradually picking up thanks to the reforms that they have introduced,” Azour said. “Yet the overall growth declined because of the volatility and the slowdown in the production due to the OPEC+ agreement (to limit oil output) and the negative growth in Iran and Libya.”


Company: cnbc, Activity: cnbc, Date: 2019-10-28  Authors: natasha turak
Keywords: news, cnbc, companies, easts, major, growth, region, report, factors, middle, imf, outlook, driving, iran, oil, contraction, sanctions, east, slowdown


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US manufacturing survey shows worst reading in a decade

A gauge of U.S. manufacturing slumped to the lowest level in more than 10 years in September as exports dived amid the escalated trade war. “We have now tariffed our way into a manufacturing recession in the U.S. and globally,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. New orders, backlog, raw materials inventories exports and imports also contracted across the board last month, ISM data showed. The deeper contraction in the manufacturing sector is the latest sign


A gauge of U.S. manufacturing slumped to the lowest level in more than 10 years in September as exports dived amid the escalated trade war. “We have now tariffed our way into a manufacturing recession in the U.S. and globally,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. New orders, backlog, raw materials inventories exports and imports also contracted across the board last month, ISM data showed. The deeper contraction in the manufacturing sector is the latest sign
US manufacturing survey shows worst reading in a decade Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-10-01  Authors: yun li
Keywords: news, cnbc, companies, survey, reading, decade, manufacturing, shows, sector, recession, orders, lowest, trade, ism, month, contraction, trump, worst


US manufacturing survey shows worst reading in a decade

A gauge of U.S. manufacturing slumped to the lowest level in more than 10 years in September as exports dived amid the escalated trade war.

The U.S. manufacturing Purchasing Managers’ Index from the Institute for Supply Management plunged to 47.8% in September, the lowest since June 2009, marking the second consecutive month of contraction. Any figure below 50% signals a contraction.

The new export orders index tanked to only 41%, the lowest level since March 2009, down from the August reading of 43.3%, ISM data showed.

“We have now tariffed our way into a manufacturing recession in the U.S. and globally,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group.

The report fanned fears of a recession and hit the stock market. The Dow Jones Industrial Average lost more than 150 points, erasing earlier gains on Tuesday.

“Global trade remains the most significant issue, as demonstrated by the contraction in new export orders that began in July 2019. Overall, sentiment this month remains cautious regarding near-term growth,” Timothy Fiore, ISM chair, said in a statement.

The ISM employment gauge for the sector dropped to the lowest since January 2016, primarily driven by a lack of demand. New orders, backlog, raw materials inventories exports and imports also contracted across the board last month, ISM data showed.

“There is no end in sight to this slowdown, the recession risk is real,” Torsten Slok, chief economist at Deutsche Bank said in a note on Tuesday following the report.

The deeper contraction in the manufacturing sector is the latest sign that the escalated trade war between the U.S. and China is taking a big bite from the economy. Manufacturing was once considered a big winner under the Trump administration with improvement in employment and activity over the past few years.

President Donald Trump blamed high interest rates and a strong dollar for the weakness in manufacturing, saying in a tweet Tuesday the central bank “allowed the Dollar to get so strong … that our manufacturers are being negatively affected. Fed Rate too high.”

The sector contracted for the first time in more than three years in August, ending a 35-month expansion period where the PMI averaged 56.5%, according to ISM.

“Comments from the panel reflect a continuing decrease in business confidence,” Fiore said.


Company: cnbc, Activity: cnbc, Date: 2019-10-01  Authors: yun li
Keywords: news, cnbc, companies, survey, reading, decade, manufacturing, shows, sector, recession, orders, lowest, trade, ism, month, contraction, trump, worst


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The US manufacturing sector contracted in August, its first decline in three years

A gauge of U.S. manufacturing from the Institute for Supply Management showed the sector contracted in August, its first decline since 2016. The ISM U.S. manufacturing Purchasing Managers’ Index declined to 49.1% in August, the lowest reading in more than three years. The escalated trade war with China is taking a big bite from the manufacturing sector, one of the big winners during the Trump administration. Production and employment gauges also showed contraction in August for the first time af


A gauge of U.S. manufacturing from the Institute for Supply Management showed the sector contracted in August, its first decline since 2016. The ISM U.S. manufacturing Purchasing Managers’ Index declined to 49.1% in August, the lowest reading in more than three years. The escalated trade war with China is taking a big bite from the manufacturing sector, one of the big winners during the Trump administration. Production and employment gauges also showed contraction in August for the first time af
The US manufacturing sector contracted in August, its first decline in three years Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-03  Authors: yun li
Keywords: news, cnbc, companies, manufacturing, contracted, slowed, sector, decline, reading, export, pmi, lowest, trade, showed, contraction, ism


The US manufacturing sector contracted in August, its first decline in three years

A gauge of U.S. manufacturing from the Institute for Supply Management showed the sector contracted in August, its first decline since 2016.

The ISM U.S. manufacturing Purchasing Managers’ Index declined to 49.1% in August, the lowest reading in more than three years. Any reading below 50% signals a contraction.

“Respondents expressed slightly more concern about U.S.-China trade turbulence, but trade remains the most significant issue, indicated by the strong contraction in new export orders,” Timothy Fiore, Chair of ISM Manufacturing Business Survey Committee, said in a statement.

The escalated trade war with China is taking a big bite from the manufacturing sector, one of the big winners during the Trump administration. Tariffs on $112 billion of Chinese goods took effect on Sunday, which targets many everyday grocery items and household staples.

The August contraction ended a 35-month expansion period where the PMI averaged 56.5%, according to ISM. Production and employment gauges also showed contraction in August for the first time after growth for almost three years, ISM data showed.

ISM’s new export orders slowed for the second month in a row to its lowest reading since April 2009.

“Many respondents continued to note global trade softness as a reason for sluggish activity,” Fiore said of slowing new export orders.

Data from IHS Markit also released Monday showed the U.S. manufacturing PMI slowed to 50.3 in August, its lowest level since September 2009. The gauge signaled a slight expansion however.

“The August PMI indicates that US manufacturers are enduring a torrid summer,” Chris Williamson, Chief Business Economist at IHS Markit, said in a statement. “Output and order book indices are both among the lowest seen for a decade, indicating that manufacturing is likely to have again acted as a significant drag on the economy in the third quarter, dampening GDP growth.”


Company: cnbc, Activity: cnbc, Date: 2019-09-03  Authors: yun li
Keywords: news, cnbc, companies, manufacturing, contracted, slowed, sector, decline, reading, export, pmi, lowest, trade, showed, contraction, ism


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South Africa in recession for first time since 2009, rand slumps

The rand stretched losses against the dollar to more than 2 percent and government bonds fell after the data was released. We reported a contraction in the first quarter … and now in the second quarter with a fall of 0.7 percent,” South Africa’s Statistician-General Risenga Maluleke said. Statistics South Africa said agricultural output fell 29.2 percent in the second quarter, while the transport, communication and storage sector fell 4.9 percent. Analysts said the dismal data would likely mak


The rand stretched losses against the dollar to more than 2 percent and government bonds fell after the data was released. We reported a contraction in the first quarter … and now in the second quarter with a fall of 0.7 percent,” South Africa’s Statistician-General Risenga Maluleke said. Statistics South Africa said agricultural output fell 29.2 percent in the second quarter, while the transport, communication and storage sector fell 4.9 percent. Analysts said the dismal data would likely mak
South Africa in recession for first time since 2009, rand slumps Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2018-09-04  Authors: rodger bosch, afp, getty images
Keywords: news, cnbc, companies, print, contraction, south, africa, fell, slumps, expecting, data, quarter, recession, 2009, second, rand, output, economy


South Africa in recession for first time since 2009, rand slumps

The rand stretched losses against the dollar to more than 2 percent and government bonds fell after the data was released. Analysts had predicted that the economy would grow 0.6 percent in the latest quarter.

“We are in a recession. We reported a contraction in the first quarter … and now in the second quarter with a fall of 0.7 percent,” South Africa’s Statistician-General Risenga Maluleke said.

Statistics South Africa said agricultural output fell 29.2 percent in the second quarter, while the transport, communication and storage sector fell 4.9 percent. Mining output grew by 4.9 percent and finance by 1.9 percent, however.

Stats SA also said the economic contraction in the first quarter was steeper than initially recorded, at 2.6 percent.

Analysts said the dismal data would likely make it harder for the South African Reserve Bank to raise interest rates at its upcoming meetings.

“There is no way to sugar coat the numbers, the growth picture in the first half of 2018 is ugly and it shows in this economy that there is broad based weakness across the primary and tertiary sectors of the economy,” said senior economist at BNP Paribas Jeffrey Schultz.

“It is spooking the market it wasn’t an expected print, a lot of analysts and ourselves were expecting a very modest second quarter print, but we certainly weren’t expecting a negative.”


Company: cnbc, Activity: cnbc, Date: 2018-09-04  Authors: rodger bosch, afp, getty images
Keywords: news, cnbc, companies, print, contraction, south, africa, fell, slumps, expecting, data, quarter, recession, 2009, second, rand, output, economy


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A tax cut designed for economic contraction, not growth

My personal take on tax reform is that it may very well be the first tax cut plan in modern American history to result in economic contraction, rather than growth. Adhering to strict supply-side principles, Treasury is, very simply, stating (once again) that tax cuts pay for themselves. Recall that the president’s first “blue print,” or guiding principles, for tax reform were also only a page long, barely a laundry list of things to do on taxes. A political “win” for the White House and Congress


My personal take on tax reform is that it may very well be the first tax cut plan in modern American history to result in economic contraction, rather than growth. Adhering to strict supply-side principles, Treasury is, very simply, stating (once again) that tax cuts pay for themselves. Recall that the president’s first “blue print,” or guiding principles, for tax reform were also only a page long, barely a laundry list of things to do on taxes. A political “win” for the White House and Congress
A tax cut designed for economic contraction, not growth Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2017-12-11  Authors: ron insana, erik mcgregor, pacific press, lightrocket, getty images
Keywords: news, games, cnbc, companies, growth, economic, measures, tax, win, summary, designed, spending, reform, cut, treasury, far, unlikely, contraction


A tax cut designed for economic contraction, not growth

My personal take on tax reform is that it may very well be the first tax cut plan in modern American history to result in economic contraction, rather than growth.

Except for a short-term boost in capital spending, there are, as far as I can tell from what has been written thus far, few “reforms” that will push growth above its current trajectory.

And, again, individuals are unlikely to see a boost in their disposable income, hence, there is unlikely to be a large increase in consumer demand that would justify businesses increasing their capital spending in the first place, save for the tax break.

Treasury Secretary Steven Mnuchin’s agency, without explanation, says in a one-page summary put out on Monday that half of the additional revenue generated by projected average annual 3 percent growth over the next decade will come from higher corporate tax revenue and from higher small business tax revenue.

Adhering to strict supply-side principles, Treasury is, very simply, stating (once again) that tax cuts pay for themselves.

It is a claim for which there remains no empirical economic evidence and has never truly been attempted in isolation of other stimulative measures that have long accompanied tax cuts, such as low interest rates, increased government spending or accelerating global growth.

This administration does not appear to take economic analysis seriously in any way, shape, or form. Recall that the president’s first “blue print,” or guiding principles, for tax reform were also only a page long, barely a laundry list of things to do on taxes.

Similarly, Monday’s “analysis” shows very little respect for budget math and makes the Reagan “rosy scenario” look frugal by comparison.

A political “win” for the White House and Congress is not the same as an economic win for the American people. There has been far too little thought put into tax reform, just as there was no replacement for the Affordable Care Act when Congress attempted to repeal and replace it.

Certainly, a small number of measures in the current tax reform proposals would be beneficial to a select group and that has been reflected in stock prices, though less so in consumer and business confidence measures and in public opinion polls.

This government would be far better off buying some bitcoin futures and hoping the price will appreciate enough to pay off the national debt.

It makes about as much sense as Monday’s budget summary from the nation’s highest-ranking Treasury official.


Company: cnbc, Activity: cnbc, Date: 2017-12-11  Authors: ron insana, erik mcgregor, pacific press, lightrocket, getty images
Keywords: news, games, cnbc, companies, growth, economic, measures, tax, win, summary, designed, spending, reform, cut, treasury, far, unlikely, contraction


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