Empire State, Tsy yields jump; US retail sales seen strong
November 15, 2021
US stocks were mixed but not Treasury yields which rose sharply Monday. A very heated Empire State manufacturing index headed Monday’s economic news, jumping 11.1 points to 30.9 or more than 8 points above Econoday’s consensus and nearly 6 points above the consensus range. The report suggests that the factory sector is not slowing down despite long delays along the supply chain and despite upward price pressures including a record high for selling prices, the latter the latest indication that inflationary pressures, transitory or not, have yet to slow down. The yield on the 30-year US bond rose 8 basis points to 2.01 percent with the 10-year yield up 5 points to 1.62 percent. The Dow Jones industrial average, the S&P and the NASDAQ all ended flat.
Tuesday is a busy day on Econoday’s calendar. In Britain, the ILO unemployment rate is expected to hold steady at 4.5 percent for the three months to September. Average hourly earnings growth is seen down a full percentage point to 6.2 percent. In Canada, housing starts are forecast to have risen to a 258,000 annual rate in October after falling to nearly 251,000 in September.
US retail sales, perhaps Tuesday’s most market-moving headline, are expected to show a 1.0 percent jump on the month in October after rising 0.7 percent in September, led by rising auto sales and higher gasoline prices. Yet even excluding autos and gas, sales are seen up a solid 0.8 percent ahead of the holiday shopping season.
Industrial production in the US is forecast to have rebounded 0.9 percent on the month in October after falling 1.3 percent in September on weakness in auto production. The median forecast for manufacturing output is a 0.7 percent rise after a 0.7 percent drop the previous month.
Among Fed speakers, Atlanta Federal Reserve Bank President Raphael Bostic will participate virtually in a panel on Racism and the Economy: Focus on Financial Services, event at 1200 EST. Philadelphia Federal Reserve Bank President Patrick Harker is scheduled to speak virtually on “Fintech and Financial Inclusion” at 1455 EST, while San Francisco Federal Reserve Bank President Mary Daly will speak at a Commonwealth Club, San Francisco hybrid event at 1530 EST.