US job cuts accelerated in March, driven by planned reductions on government payrolls, a report by out placement firm Challenger, Gray & Christmas Inc showed. Employers announced plans to cut 67,611 jobs in March, which is up 61% from February, when 42,090 jobs were lost. (CNN Money)
A separate report from payroll processor ADP showed that private-sector employers cut payrolls by 23,000 jobs in March. ADP's report does not include government jobs. These two reports set the stage for the highly anticipated monthly jobs report from the government due later today. The US Labor Department is expected to show a gain of 184,000 jobs in March, compared to the 36,000 lost in February. Economists forecast the unemployment rate will remain unchanged at 9.7% according to a Bloomberg survey.
US manufacturing activity grew for the eighth straight month in March, as the Institute for Supply Management's (ISM) manufacturing index rose to 59.6 from the February reading of 56.5. Economists surveyed were expecting a reading of 57. The strong number was driven by significant growth in new orders and production, as well as larger inventories, which grew for the first time in 46 months. While the report's employment component slipped 1 point to 55.1 in March, that still indicates growth. (CNN Money)
US initial jobless claims fell by 6,000 to 439,000 claims filed in the week ended March 27. Economists surveyed expected new claims to dip to 440,000 in the week. The report also said that 4,662,000 people filed continuing claims in the week ended March 20, the most recent data available. That figure, the lowest level since Dec. 20, 2008, was down 6,000 from the preceding week's 4,668,000 claims. (CNN Money)
US construction spending fell 1.3% to a seasonally adjusted annual rate of US$846.23bn for a fourth straight month in February (-1.4% in Jan). This is the slowest rate in nearly 7-1/2 years which was due to softening activity in every major sector from homebuilding to public construction projects. Economists forecast for a 1.0% drop in the month. Private sector construction recorded a 1.2% decline and the public sector was down 1.7%. Private residential construction fell 2.1% (+1.0% in Jan). (CNBC, Xinhua)
US auto sales rebounded 24.0% in March with virtually every automaker posting doubledigit gains in sales. But the industry is not in as strong shape as those surges in sales would suggest. General Motors (+37.8%), Ford Motor (+34.4%) and Toyota Motor (+35.3%) all posted sharp year-over-year sales gains in March, benefiting from new incentives and a slowly improving economy. (CNN Money, CNBC)
Treasury Secretary Timothy Geithner said that focusing on cutting the US's big budget deficit now would jeopardize economic growth at a time when jobs are starting to be created. But even if that occurs, the unemployment rate will stay high for "a long period of time." (CNBC)
New York Fed President William Dudley says the US appears to be on the verge of sustained employment growth, although job creation still much too slow. Recovery is unlikely to be as strong as we would desire. Output gap to close very gradually, keeping inflation 'subdued.' But longer term inflation expectations remain 'well anchored.' (Xinhua)
Fitch Ratings is revising up its 2010 growth forecasts for major developed economies, with the largest revisions to US and Japanese GDP, the credit ratings agency said Thursday in its latest Global Economic Outlook. Against this backdrop and given higher inflation due to rising commodity prices, the Federal Reserve is likely to hike its Fed funds rate by 25bp in the fourth quarter of this year. (Xinhua)
Europe’s manufacturing index expanded at a faster pace than initially estimated to 56.6 in March (54.2 in Feb), due to reviving global demand prompted companies to step up output. The initial estimate was 56.3. (Bloomberg)
Japan’s largest manufacturers became the least pessimistic about the economy since 2008 as a global rebound drove demand for exports. The Tankan index of sentiment rose to -14 in 1Q from -25 in 4Q09. This matched the economists’ forecast. (Bloomberg)
South Korea’s exports rose 35.1% yoy to US$37.7bn in March (30.5% in Feb) as a recovering global economy boosted demand for semiconductors, cars and petrochemicals. Imports climbed 48.4% yoy to US$35.5bn (37.5% in Feb), leaving a trade surplus of US$2.2bn (US$2.1bn in Feb). Economists forecast the exports and imports would increase by 31.7% yoy and 43.0% yoy respectively for March. (Bloomberg)
South Korea’s consumer prices climbed 2.3% yoy in March (2.7% in Feb), marking the slowest pace in six months as a stronger currency helped cap the cost of manufactured goods. From a month earlier, prices rose 0.3% (0.4% in Feb). Economists projected the inflation would advance to 2.7% yoy and 0.7% mom in March. (Bloomberg)
China’s Purchasing Managers’ Index of manufacturing rose to a seasonally adjusted 55.1 in March (52.0 in Feb), adding to the case for a wind-back of stimulus measures that policy makers say may be contributing to asset-bubble risks. The figure was in line with the market consensus (55.0). (Bloomberg)
Indonesia’s inflation slowed to 3.4% yoy in March (3.8% in Feb), giving the central bank room to refrain from raising interest rates when it meets next week. Market estimated a 3.7% gain in the month. (Bloomberg)
India’s food-price inflation accelerated 16.35% yoy in the week ended 20 Mar (16.22% in the previous week), marking the first time rise in four weeks. Exports rose 34.8% yoy to US$16.1bn in February (11.5% in Jan) while imports expanded 66.4% to US$25.0bn (25.5% in Jan). Purchasing Managers’ Index of manufacturing fell to 57.8 in March (58.5 in Feb). A reading above 50 indicates a gain in factory production. (Bloomberg)
Oil prices rose to 17-month highs on further signs that a global economic recovery would boost consumption. In New York the price of a barrel of light sweet crude for delivery in May rose over a dollar to US$84.87 by the end of trade on 1 Apr, up from US$83.76 the day before. Brent North Sea crude for May also hit a similar high at US$84.04, before pulling back slightly to US$83.96, up US$1.26. (Channel News Asia)
Thailand’s consumer prices rose for a sixth month in March, putting pressure on the central bank to raise interest rates from a five-year low. An index of consumer prices rose 3.4% yoy in March (3.7% in Feb). That compares with the median forecast for 3.7%. (Bloomberg)
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