Gavekal Capital: US Econ Round-Up - IP Stronger, Surveys Hold

Monday, December 16, 2013

US Econ Round-Up - IP Stronger, Surveys Hold

Industrial production rose 1.1% in November, a much stronger gain than forecasters had expected (consensus was for 0.6% gain). The stronger gain in November to took the overall level of industrial production above 2007 highs for the first time. While Utilities helped to push industrial production upwards, the manufacturing component had a solid 0.6% gain. Capacity utilization also rose to it's highest level in over 5 years.

Two surveys were released today for December. The Empire State Manufacturing survey showed a slight improvement from November from -2.2 to 1. This would indicate that the New York manufacturing area moved from slightly contracting to slightly expanding in December. The Markit Flash Manufacturing PMI ticked down slightly from the final level in November (54.7 to 54.4).

The revised productivity release showed a stronger gain during the third quarter while the revised unit labor cost declined more for the second time in three quarters this year. Productivity was slightly above consensus at 3% annualized rate while unit labor costs came in right at consensus of -1.4% annualized rate.

About Gavekal Capital

Gavekal Capital is a US registered investment advisory firm that manages the Gavekal Knowledge Leaders Strategy. Knowledge Leaders are a group of the world’s leading innovators with deep reservoirs of intangible capital. These companies often possess competitive advantages such as strong brand, proprietary knowledge or a unique distribution mechanism. Knowledge Leaders are largely service-based and advanced manufacturing businesses, often operating globally. Gavekal Capital seeks to identify the world’s leading knowledge companies through a proprietary process that analyzes corporate knowledge investments.
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