Evidence of making things (but not Brexit deals)

Posted by: Paul Donovan

19 Mar 2019
  • US factory orders and durable goods orders are due. Generally, US manufacturing has fared fairly well recently (it is the Germans who have led developed economy manufacturing lower). Ending NAFTA tensions should help US factories. However, hopes for a US-China trade deal may delay orders (why buy now with trade taxes if it could be tax free in a few weeks?).
  • The US agriculture secretary is suggesting that China could treble its imports of US farm products under a deal. That does of course depend on Chinese consumers wanting to buy US farm products.
  • From the Eurozone, there is the German ZEW business sentiment survey. Survey evidence always needs to be treated with considerable caution, but German surveys generally have a somewhat higher correlation with reality than most.
  • The interminably tedious EU-UK divorce is set to be more interminable, with the speaker of the House of Commons telling the government to stop asking the same question to the same Parliament. Assuming the queen does not shut down Parliament and reopen it (unlikely), this suggests UK Prime Minister May will have to ask for a long delay to the divorce at the EU heads of government meeting on Thursday.