The Commerce Department announced today that it would postpone all of next week's scheduled news releases. This includes reports on single-family home sales, construction spending, and factory orders. Commerce also stated that the January 12 release of December retail sales figures might be delayed. This brings to 16 the number of economic news releases impacted by the budget impasse.

This postponement stuff must be catching. The University of Michigan was supposed to release a report on consumer sentiment this morning. But, that didn't happen either. Maybe they'll get it out next week.

The December Chicago Purchasing Managers' Survey was released today, as scheduled. The Chicago group reported that its index of economic activity advanced from 49.9 to 57.6 from November to December, and that its prices paid index rose from 49.9 to 56.9 during the same period. These figures indicate a localized pickup in manufacturing activity, accompanied by shortages in the supplies and materials that support that activity. These results were rather surprising in light of the preponderance of other data indicating a general slowing of activity in the manufacturing sector. We need to wait until next week and see what we find when the National Association of Purchasing Management releases the results of its nationwide survey.

The bond market was temporarily jolted by the Chicago report. But, it shrugged off the news and bounced back. The 30-year T-bond tacked on another 12/32 to the upside to close at a yield of 5.96%.

Byline: Lafferty (MF Merlin)