Economy

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The key ISM March US services index soared to an all time high 63.7 vs 59.0 marks the tenth straight month of growth for the services sector which accounts for over 80% of the US GDP.  All 18 services industries reported growth with many getting supply chain disruptions bringing inflation risk.  

The US in March added 916K non-farm payrolls jobs more than forecasted 639,000 new jobs. Unemployment is recovering after the Coronavirus hit the economy as people return to work. The unemployment rate fell to 6.0%, however 8.4 million jobs short of the peak in February of 2020.

Mortgage applicationsin the US fell for the 4th consecutive decline, as higher mortgage rates started to dent the housing market. Applications fell 2.2 percent in the week ended March 26th, 2021. The average 30-year fixed-rate mortgages edged down to 3.33% from 3.36%, the highest since the beginning of June last year.

South Korea reported February industrial output at its fastest pace since June last year. Industrial output seasonally adjusted +4.3% mth/mth over the expected Reuters poll -0.1% over January.  Industrial output +0.9% yr/yr  versus the Reuters poll +2.5%. 

US New Home Sales in February were 775K vs 870K expected and down from prior 923K. Sales -18.2% vs -5.7% expected to the lowest in 9 months. The Midwest sales fell 37.5% with extreme cold weather however all regions fell back so weather was not the only negative impact.

President Biden’s first major legislative initiative, the $1.9 trillion 'American Rescue Plan' stimulus bill passed a deeply divided Senate on Saturday in a vote 50-49. Democrats pushed through a loosely termed "pandemic aid plan" that includes an extraordinary increase in safety net spending.

The US in February added 379K non-farm payrolls jobs more than forecasted 199,000 new jobs. Unemployment is recovering after the Coronavirus hit the economy as people return to work. The unemployment rate fell to 6.2%, however long-term unemployed workers account for an increasingly larger share of the unemployed at 39.5%.

China's consumer inflation unexpectantly dropped by 0.3 percent year-on-year in January 2021, from 0.2 percent the previous month and compared with market consensus of unchanged. The decline was primarily due to a fall in the cost of transport (-4.6% vs -3.1%) and rent, fuel, and utilities (-0.4% vs -0.6%). However food prices went up 1.6 percent, the most in three months

The US in January added 49K non-farm payrolls jobs with the resurgence of Covid-19 less than  a forecast 57,000 new jobs. Unemployment is recovering after the Coronavirus hit the economy as people return to work. The unemployment rate fell to  6.3%, however long-term unemployed workers account for an increasingly larger share of the unemployed at 39.5%.

US Personal Income and Spending report for December came in better than feared Friday. Personal income increased 0.6% m/m in December higher than the consensus 0.1% and rebounding from a revised 1.3 percent slump in November. Personal spending declined 0.2% versus consensus -0.5%. Investors came away with a sense of relief.

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