Macro Briefing: 3 December 2024

US manufacturing contraction eased in November, according to the survey-based ISM Manufacturing Index. The 48.4 reading is the highest since June, but remains well below the neutral 50 mark.

US construction spending rose in October, boosted by single-family homebuilding, the Commerce Dept. reports. Spending rose 0.4% after an unrevised 0.1% gain in September. For the year-over-year change, spending increased 5.0%.

Global manufacturing stabilized in November, based on JP Morgan Global Manufacturing PMI survey data. The 50.0 reading, which reflects a neutral stance, follows four months of contraction.

China bans exports to US of key high-tech materials — including gallium and germanium — with potential military applications. The announcement from the Chinese Commerce Ministry follows Washington’s expandion of its list of Chinese companies subject to export controls on computer chip-making equipment, software and high-bandwidth memory chips.

A top Fed official says he’s leaning toward supporting another rate cut at the Dec. 18 policy meeting. “That decision will depend on whether data that we will receive before then surprises to the upside and alters my forecast for the path of inflation,” says Christopher Waller, a member of the Fed’s Board of Governors.

Policy-sensitive 2-year US Treasury yield is still trading below its recent peak after rising to 4.19% on Monday. The yield is below the current 4.50%-to-4.75% range for the Fed funds target rate, a sign that the bond market continues to anticipate more rate cuts by the central bank.