Pending Key Economic Indicators for Supply Chain Managers

Supply chain managers gearing up for the week ahead should remain mindful of several pending key indicators, say IHS Global Insight US Economists.

As noted in SCMR, Retail sales edged up 0.1% in October. Excluding autos and gasoline, retail sales rose 0.3%. We expect retail sales to improve in November, since many shoppers were waiting for the heavy price discounts and promotions that occur in early November.

Meanwhile, The University of Michigan’s Consumer Sentiment Index increased by 3.1 points in the first weeks of November, to 93.1.

“Consumer sentiment is starting to make a comeback due to falling pump prices, a strong employment report, and modest consumer price inflation,” says economist, Patrick Newport.

He also noted that producer prices dropped 0.4% in October. Much of the drop was in services, particularly retailing, as an uptick in crude prices and a downtick in pump prices squeezed gasoline station margins. Meanwhile, food prices sank 0.8% on declines in egg, beef, and veal prices, while core goods prices fell 0.3%.

Next week brings housing starts, consumer prices, and industrial production reports for October.

“Housing starts likely declined to a 1.159-million-unit annual rate on a decrease in multifamily starts, while building permits moved up to 1.138 million,” says Newport. “The Consumer Price Index probably rose 0.1% due in part to higher seasonally adjusted gasoline prices. Industrial production likely fell 0.2%, as manufacturing remained sluggish and utilities and mining output declined.”

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