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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: redfish who wrote (29133)	5/2/2005 10:52:58 AM
From: mishedlo	Respond to of 116555

U.S. April ISM declines to 53.3% - Monday, May 2, 2005 2:45:39 PM afxpress.com WASHINGTON (AFX) -- Factory activity in the United States decelerated for the fifth straight month in April, the Institute for Supply Management reported Monday The ISM index fell to 53.3% in April from 55.2% in March. This is the lowest level since July 2003. The decline was larger than expected. The consensus forecast of estimates collected by MarketWatch was for the index to slip to 54.6% in April. Economists were watching the ISM index closely to see whether the soft-patch the economy hit in March continued into April "The trend is definitely toward a slower pace of growth," said Norbert Ore, chair of the IMS business survey committee The index remains just over 50%, which indicates that most firms say business is getting better or at least no worse New orders fell to 53.7% in April from 57.1% in March. The employment index fell to 52.3% from 53.3% Prices inched lower to 71.0% in April from 73.0% in March. Ore said the slower rate of growth should relieve some of the pricing pressure Inventories fell sharply to 47.9% from 54.1%. This shows that manufacturers are adjusting to slower growth in new orders, Ore said In a separate report issued Monday, the Commerce Department said construction spending rose 0.5% percent in March

To: redfish who wrote (29133)	5/2/2005 10:54:17 AM
From: mishedlo	Respond to of 116555

U.S. March pending home sales down 0.3% Monday, May 2, 2005 2:42:42 PM afxpress.com WASHINGTON (AFX) -- U.S. pending home sales fell 0.3% in March, the National Association of Realtors said Monday. Pending sales were up 1.7% year-over-year. "Considering we've set records for home sales in each of the last four years, the level of contract activity is exceptionally strong," said David Lereah, chief economist for the real estate group

To: redfish who wrote (29133)	5/2/2005 10:59:02 AM
From: mishedlo	Respond to of 116555

FOREX-Yen loses ground as China currency talk fades Monday, May 2, 2005 11:53:39 AM reuters.com By Carolyn Cohn LONDON, May 2 (Reuters) - The dollar recovered by nearly one percent from last week's six-week low versus the yen on Monday as dealers lost enthusiasm about betting on a near-term revaluation of China's currency. The yen was also hurt by reports that North Korea may have test-fired a missile into the Sea of Japan. The currency retreated further from a three-month peak versus the euro set on Friday after a Chinese state newspaper said deepening reforms had created the conditions for China to revalue the yuan. That report, coupled with a surprise rise in the yuan's value beyond its tightly regulated trading band on Friday that was later called an error, added to already intense speculation that China will soon relax the yuan's peg. "We saw a big move last week on the back of these rumours about the yuan, and that has run its course," said Michael Klawitter, currency strategist at WestLB in Duesseldorf, Germany. "Dollar/yen has retraced a bit, but the argument remains in the market and the dollar's upside is limited." European trade was stifled by a holiday in Britain. China and Singapore were also closed for holidays on Monday, and Japan will be closed from Tuesday to Thursday for Golden Week holidays. The yen fell during Asian trade and was down more than half a percent from Friday's U.S. close at 105.38 yen per dollar <JPY=> at 1135 GMT. The yen was also down more than half a percent against the euro at 135.56 <EURJPY=>. Buying the yen is a popular bet on a near-term move by China to loosen its tight 8.28 peg to the dollar, which is expected to spark a broad rally in Asian currencies. The dollar was trading virtually steady on the day at $1.2863 <EUR=>, after extending Friday's gains to hit a two-week high of $1.2841. The U.S. ISM manufacturing index for April is due at 1400 GMT, forecast at 55.0 versus 55.2 in March, well above the 50 level that denotes expansion. The U.S. Federal Reserve is widely expected to raise interest rates by a quarter point to 3 percent when it meets on Tuesday. FRENCH VOTE The euro recovered slightly from earlier eight-month lows against sterling <EURGBP=>. The euro has been under pressure from worries the French may vote against the proposed EU constitution in a referendum on May 29. French supporters of the constitution have edged ahead of those who plan to vote "no" for the first time since mid-March, an opinion poll released on Saturday said. The euro was little moved by news that euro zone manufacturing contracted for the first time in 20 months in April as softer global growth and a strong euro hurt exports. The PMI index fell below the 50 line that divides growth from contraction for the first time since August 2003, hitting 49.2. "The data was pretty poor, suggesting the euro zone industrial sector is close to recession," said Carsten Fritsch, currency strategist at Commerzbank in Frankfurt. "But that was already known from the data we have already had, and trade is muted because of the holiday in the UK." ERM-2 JOINERS In other markets, Malta, Cyprus and Latvia joined the Exchange Rate Mechanism (ERM-2) over the weekend, following their entry into the European Union a year ago. On Monday, the European Central Bank set the intervention bands for the ERM-2 newcomers. The Cyprus pound can trade in a band of 0.673065-0.497483 to the euro <EURCYP=R>. Latvia's lat <EURLVL=R> can trade between 0.808225-0.597383 lats per euro. The Maltese lira was put in a 0.493695-0.364905 lira per euro band <EURMTL=R>.