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Dallas Fed Manufacturing Index Falls As Factory Activity Contracts

By:
Vladimir Zernov

New Home Sales fell in October as high mortgage rates put pressure on buyers.

Dallas Fed Manufacturing Index

In this article:

Key Insights

  • Dallas Fed Manufacturing Index decreased from -19.2 in October to -19.9 in November. 
  • Production Index pulled back from 5.2 in October to -7.2 in November. 
  • New Home Sales declined by 5.6% month-over-month in October. 

On November 27, the Federal Reserve Bank of Dallas released Dallas Fed Manufacturing Index report. The report indicated that Dallas Fed Manufacturing Index declined from -19.2 in October to -19.9 in November, compared to analyst consensus of -17.

Production Index declined from 5.2 in October to -7.2 in November, while New Orders Index decreased from -8.8 to -20.5.

Today, traders also had a chance to take a look at New Home Sales data for October. The report indicated that New Home Sales declined by 5.6% on a month-over-month basis, compared to analyst consensus of -4%. High mortgage rates continue to put pressure on the housing market.

Treasury yields are moving lower today as traders bet that Fed will start cutting rates in the first half of the next year to provide additional support to the economy.

Interestingly, U.S. Dollar Index is mostly flat despite falling Treasury yields. However, the weaker-than-expected economic reports may put additional pressure on the American currency.

Gold settled near the $2010 level as demand for the metal remained strong amid falling yields.

SP500 is mostly flat as traders wait for additional catalysts. At this point, the disappointing reports did not put any material pressure on stocks. Fed policy outlook remains the key driver for equity markets, so falling Treasury yields may serve as a significant bullish catalyst for stocks.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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