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The ISM manufacturing rebounded in November from 57.7 to 59.3. Anders Svendsen, Research Analyst at Nordea Markets, point out that not all details paint as rosy a picture as the headline number, but ISM at these levels clearly point to too bearish pricing of the Fed.

Key Quotes:  

“Not all looks as rosy as the headline number suggests, though: The total new orders index climbed to 62.1, or returned to the September level, following the steep drop in October, but the new export orders remained unchanged after last month’s drop; the ratio of new orders-to-inventories still point to slightly lower production in a month’s time; and the prices paid component took another dive to 60.7 from 71.6 the month before.”

“We continue to see a gradual decline in the ISM manufacturing index.”

“Today’s numbers support the view that current market pricing of the Fed – with just about two more rate hikes priced in – is too bearish.”