While surveys remain Trumped up, at least so far when it comes to actual numbers the deceleration continues, and can’t reverse without a commensurate increase in deficit spending, public or private:
ADP is pointing to a softer-than-expected employment report on Friday. ADP’s estimate for private payrolls is 153,000, a still respectable level of growth but noticeably below the Econoday consensus for 172,000. Private payroll growth in Friday’s December employment report from the government is expected to come in at 165,000 with total nonfarm payroll growth at 175,000.
Hiring is less active but new orders are unusually strong in December’s ISM non-manufacturing report where the index, at 57.2, matches November as 2016’s best. New orders are up 4.6 points to 61.6 to signal the strongest rate of monthly growth since the middle of last year. Business activity is also very strong, at 61.4.
But other readings show less strength. Employment is down 4.4 points to 53.8 but is still safely over breakeven 50 and is actually the third best reading of 2016. Backlog orders, however, are not above 50, at 48.0 for a 3.0 point loss that will not raise demand for new employees. And though new orders are strong, export orders slowed by 4.0 points to 53.0 and a 4-month low