Adding up the Indices
It may not seem like much to you, but watching the results of Monday’s Dallas Federal Manufacturing Activity jump from 3.8% to 8.3% was pretty exciting for me. That’s almost a 5 point jump and may be a good forecast for production out of the US. I started looking back at other production indicators: Chicago Purchasing Manager’s Index went up to 60 from 56.1 (November 2009 to December 2009), Philadelphia ISM increased in December as well, moving from 16.7 to 20.4. Forecasts for the Richmond Federal Manufacturing survey expect a modest increase from -4 to 0, while December’s durable goods orders (including transportation) are forecast at 2%, a 1.8% increase over the November.
That’s a lot of numbers, and it may not mean much until you start to break it down and give it some thought. If manufacturing activity is on the rise in the US, that means someone somewhere is running a business that is employing people. If we’re hiring people to make stuff then we’re selling that stuff at home and abroad. This could be the beginning of a slight upswing in market conditions for the US.
Gross Domestic Product (GDP) for the US is scheduled to be announced this Friday (1/29/2010) and may be the confirmation of the manufacturing data that the US is taking its next wobbly steps toward economic stabilization. If the market can see the sense in the modest forecasted increase of 1% then we could see some strengthening to the USD side starting as early as Wednesday.
Triffany Hammond helps traders of all levels, gain the tools, resources and guidance necessary to build on their strengths and work around their weaknesses so that they can make the best possible decisions for themselves in the Forex Market. Triffany is a regular speaker and contributor at 
