A little late on this but the American Iron & Steel Institute (AISI) reported on 7/23: US raw steel production increased 1.2 percent the week of July 15 as mills operated at an average capability utilization rate (ACUR) of 79.5 percent, the highest production level since mid-May. In the corresponding week last year mills operated at an ACUR of 73.5 percent. Thus far this year mills have operated at an ACUR of 77 percent, down from the same period last year when mills operated at an ACUR of 78 percent.

Bureau of Economic Analysis (BEA)

Its advance estimate of 2nd quarter GDP at 1.7 percent growth in the output of goods and services produced by labor and property located in the United States (that is, from the first quarter to the second). In the first quarter, real GDP increased at 1.1 percent (revised downward from 1.8 percent). The GDP numbers are revised monthly over 1 quarter (and then into the future) to gain a more “actual” view. The first revision for the 2nd qtr will be released August 29. “The Bureau emphasizes that numbers released today are based on source data that are incomplete and subject to further revision.” As a view in to future economic growth (or contraction) the numbers aren’t worth much. I report them as a view into the past quarter (and the poor numbers confirm our view of conditions in a majority of the sectors we serve), not as a barometer of future growth (or contraction). As dismal as these numbers are, nearly five years into the current business cycle, some sectors are extremely busy and profitable.

The Institute for Supply Management (ISM)

Its Chicago Business Barometer index reported an increase to 52.3 in July from 51.6 in June, led by gains in Order Backlogs and Supplier Deliveries, more than offsetting a second monthly decline in both Production and New Orders. While still in contraction, Order Backlogs rose in July following a record plunge in June but remain below the average seen over the past year. Commenting on the Chicago Report, Philip Uglow, Chief Economist at MNI Indicators said: “While the Chicago Business Barometer” ticked higher in July, declines in both Production and New Orders show just how challenging the business environment is.”

Just goes to show you…..On Wednesday (7/31) the AISI released its steel production numbers for the week of 7/22. Surprise! US raw steel production slides 1.7 percent from the previous week (see opening statement) as mills operated at an ACUR of 78.1 percent. In the corresponding week last year, mills operated at an ACUR of 73.3 percent. On the year, mills have operated at an ACUR of 77 percent, down from the same period last year when mills operated at an ACUR of 78 percent.

On August 1, 2013 the Institute for Supply Management (ISM) issued its Purchasing Managers Index report for July.

The PMI registered 55.4 percent, an increase of 4.5 percentage points from June’s reading of 50.9 percent. July’s PMI reading, the highest of the year, indicates expansion in the manufacturing sector for the second consecutive month. The New Orders Index increased in July, the Production Index increased in July.”

The US Census Bureau has released its full report on Manufacturer’s Shipments, Inventories and Orders for June 2013
  • New orders for manufactured goods in June, up four of the last five months, increased 1.5 percent. This was the highest level since the series was first published in 1992.
  • New orders for manufactured durable goods, up four of the last five months increased 3.9 percent.
  • Shipments of manufactured durable goods, down two of the last three months, decreased 0.2 percent.
  • Inventories of manufactured durable goods, up two of the last three months, increased 0.1 percent.

Employers only added about 162,000 jobs in July. That’s about half of what we need for a growing economy. The unemployment rate dropped to 7.4 percent. (Really???)

Have yourself a nice relaxing weekend.
God Bless America