Interest Rate Roundup

Thursday, February 15, 2007

Claims bad, Import prices mixed, Empire strong

Here we go -- lots of economic data just hitting the tape ...

* Jobless claims were much WORSE than expected - initial claims were up 44,000 to 357,000 versus expectations for 314,000. That was a 17-month high. Continuing claims also rose to 2,560,000, vs. a forecast for 2,500,000. Weather may be partly responsible for the spike

* Import prices dropped 1.2% between December and January, vs. a forecast for a 1.1% decline. Ex-petroleum costs were unchanged, vs. +0.5% in December. BUT if you exclude ALL fuels (oil and otherwise), import prices were up 0.3%, the biggest gain since September.

* An early reading on the economy in February, called the Empire Manufacturing Index, looked good. The index jumped to 24.4 from 9.1 in January. That was well above the 10.6 reading that was expected. Sub-indices measuring prices paid and prices received declined, while indices measuring new orders and employment popped.

The early market reaction? A small gain in bonds ... a small drop in the dollar ... and a small pop in stock futures. Next up -- international capital flow data at 9, industrial production/capacity utilization at 9:15, the Philly Fed at noon, and the February NAHB housing index at 1. Oh, and don't forget "Round Two" of Gentle Ben in front of the House at 10!


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