This is a Recovery? Manufacturing Shrinks to Lowest Level Since Oct 2009
Business activity in the U.S. unexpectedly contracted in September for the first time in three years, adding to signs manufacturing will contribute less to the economic recovery. The Institute for Supply Management-Chicago Inc. said today its business barometer fell 49.7 this month from 53 in August. A reading of 50 is the dividing line between expansion and contraction.
This is not surprising given yesterday’s disastrous durable goods orders report.
But the University of Michigan survey of consumer confidence rose to 78.3, the second highest reading since President Obama was sworn into office. Unfortunately, it is still far below the readings from President Bush (Dubya).
Personal income barely rose (0.1%) as did personal spending (+0.1%).
This is a recovery? It is hard to sustain a housing “rally” with such a stagnant (and declining) economy.
The New York Fed completed its first monthly purchase of $20 billion of agency MBS.