US: Chicago PMI rose 3.7pp to 67.6 in December – Nomura

Analysts at Nomura note that Chicago PMI rose 3.7pp to 67.6 in December, above expectations (Nomura: 64.5, Consensus: 62.0), up from 63.9 in November as indicated strong momentum at the end of the year, reaching the highest level since March 2011.

Key Quotes

“The production index rose strongly by 7.6pp to 77.7, suggesting robust expansion in output. New orders index jumped 9.5pp to 72.7, pointing to increasing demand. Inventories index, which rose 4.8pp to 64.5, suggests firms are increasing the amount of stocks.”

“The survey reported that firms are shoring up the level of stock “to support stretched lead times and in preparation for product launches scheduled for the new year.” The employment index fell 1.8pp, but remained at an elevated 55.3, consistent with our expectation that nonfarm payroll employment likely increased at a healthy pace in December.”