April 25, 2016

This Week’s Top Economic Data Points: Steel Demand Will Continue To Weaken

  • According to the World Steel Association, global steel demand will continue to decline for the remainder of this year, but will recover somewhat in 2017. The association predicts demand will fall 0.8 percent in 2016 to 1.488 billion metric tons after declining three percent in 2015, but will expand 0.4 percent next year. World Steel Economics Committee Chairman T.V. Narendran said, “In 2016, while we are forecasting another year of contraction in steel demand in China, slow but steady growth in some other key regions, including NAFTA and EU, is expected.”
  • The Chicago Federal Reserve Board’s National Activity Index indicated U.S. growth slowed in March. The index fell to -0.44 in March from -0.38 in February as three of the four broad categories of indicators that make up the index declined from February, and all four categories made nonpositive contributions to the index in March. The index’s three-month average also fell. The Conference Board’s Leading Economic Index, meanwhile, rose 0.2 percent in March to 123.4 from February. Conference Board Director of Business Cycles and Growth Research Ataman Ozyildirim said, “Financial conditions, as well as expected improvements in manufacturing, should support a modest growth environment in 2016.”
  • The Federal Reserve Bank of Philadelphia’s manufacturing index fell to -1.6 in April from +12.4 in March. The new orders index fell to 0 from +15.7 while the shipments index dropped to -10.8 from +22.1. Inventories, the number of unfilled orders, delivery times and employment readings also weakened.
  • According to the U.S. Department of Labor, 247,000 individuals filed for federal unemployment benefits for the week that ended April 16, down from 253,000 the week before. The reading was at its lowest level since November 1973. The four-week moving average of first-time claims also fell and has now been under the 300,000 mark that indicates overall employment growth for 59 weeks. (That streak is the longest since 1973.) The number of individuals who continued to file for benefits fell to 2.137 million, its lowest rate since November 2000, for the week that ended April 9. The four-week moving average of continuing claims also fell and is now at its lowest level since November 2000.
  • In other economic news: in a reading that was worse than expectations, Statistics Canada announced wholesale sales in Canada fell 2.2 percent between January 2016 and February 2016 while inventories rose 0.2 percent; the number of new homes under construction fell 8.8 percent from February 2016 to March 2016, but was up 14.2 percent between March 2015 and March 2016; and the number of existing homes sold in the United States rose 5.1 percent between February and March.