Manufacturing activity in the New York area took a downturn in July, according to the latest data from the Federal Reserve Bank of New York. The general business conditions index fell to -6.6, a drop from June's -6.0, contrary to economists' expectations of stability. This index, a critical indicator of the manufacturing sector's health, suggests contraction when below zero. It also offers valuable insights into the current state and six-month outlook for New York manufacturers.

These poor economic data from a crucial sector of the US economy will further increase the pressure on the fat cat to cut interest rates quickly. The effect of a slowing economy on the labor market can no longer be overlooked. Here it is the state that is only creating pseudo-jobs while the private sector is apparently already in crisis.

The world is waiting for the fat cat to finally lower interest rates and provide more and faster liquidity to restart the credit engine. The pressure is growing, but so far it does not look as if there will be any decisive interest rate moves to report from New York, especially in the Europeans, who are suffering extremely from the interest rate competition, which is putting additional pressure on their ailing economy.