6/21/2010
HEADLINES
NFDA Forecast Shows Key Metals Indicators Up
All leading indicators are pointing to U.S. economic recovery and growth according to the National Fastener Distributors Association Market Forecast for the summer of 2010.
Key indicators for the fastener industry are the rising Metal Working Machinery New Orders & Defense Capital Goods New Orders. “These trends forebode mildly improving market conditions for NFDA members,” the Institute for Trend Research summarized.
Metal Working Machinery reached a 16-month high in March and the Defense Capital Goods hit a 14-month high.
The U.S. Industrial Production Index rose to 3/6% in April – meaning production for the quarter was above 2009.
• The Purchasing Managers Index jumped 60.4% in April to reach its highest since 2004. The increase is based on gains in production, new orders, employment, prices and imports.
The 12/12 rate-of-change topped a 25-year high, indicating recovery through the year. Recent downturn implies 2011 growth may be slow, but not ominous.
• Corporate Bond Prices trend improved slightly in April though the overall trend is cautionary for 2011.
The 12MMA data trend previous high was in November 2009 and has started rising again. “This is great news in terms of the current trend status of this important leading indicator and suggests only slower growth in production for 2011,” ITR commented.
• “With a tentative 1/12 peak in March 2010, the U.S. Leading Indicator joined Corporate Bond Prices and the Purchasing Managers Index in signaling a slower rate of growth for 2011,” ITR noted. “If this peak is confirmed by the next few months of data, median timing would suggest a transition to slower growth in the benchmark U.S. Industrial Production Index near the end of 2010.”
• The importance of slow retail sales is minimal. “Consumers are shopping, as is evident in the mildest seasonal decline (Dec-Mar) on record,” ITR explained. “The best indication of future gains is reflected in the positive momentum in the rate-of-change trends.”
• The five market specific production sectors – light vehicle, fabrication metal, appliance, marine craft and motor vehicle parts production – all are up, and are forecasted to rise mildly through 2011. ©2010 GlobalFastenerNews.com
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