"With the government shutdown over, with global growth picking up, we'll see solid growth in manufacturing."
- Gus Faucher, senior economist at PNC Financial Services Group Inc
It was not a surprise that Bernanke's speech, which was highlighted in all economic calendars as a high importance event, had practically no impact on markets on Monday. Ben just provided welcoming remarks, and obviously avoided the widely-discussed tapering topic. Nevertheless, the greenback gained some traction in the beginning of the week, as manufacturing sector strengthened in November, while construction spending climbed in October, suggesting they will help propel the world's largest economy in early 2014. A report from the Institute for Supply Management showed an index, measuring activity in the manufacturing sector, soaring to 57.3 in November, the highest since April 2011, beating analysts' expectations for a 55.1 figure and higher from 56.4 posted a month earlier, with all measures of orders, production and employment improving. This was the sixth-consecutive month of quicker growth in sector since contraction in May, while the most remarkable growth was recorded after the partial government shutdown that dragged on the activity in October. Meanwhile, the forward-looking index rocketed to the highest since April, rising to 63.6 from 60.6.
Construction spending jumped 0.8% to an annual rate of $908.4 billion, suggesting record-low interest rates are finally starting to have an impact of the economy, and, together with strong manufacturing sector, are pointing at solid performance in the beginning of 2014.
© Dukascopy Bank SA