how will impact Hurricane Sandy on economic losses : Hurricane Sandy may cause as much as $20 billion in economic damage and losses as the biggest Atlantic storm made landfall, flooding homes and offices, after disrupting millions of fliers and forcing stores to close.
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Showing posts with label economic. Show all posts
Showing posts with label economic. Show all posts
Monday, October 29, 2012
Thursday, October 25, 2012
how will Survey China manufacturing for October 2012
how will Survey China manufacturing for October 2012 : A key survey of Chinese manufacturing activity rose to a three-month high in October, easing concerns that China might experience an abrupt economic "hard landing" rather than a gradual slowdown. The survey, released Wednesday, showed that industrial production continues to shrink, but not as sharply as in the past.
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UK Economic out of the double-dip recession report today oct 25 2012
UK Economic out of the double-dip recession report today oct 25 2012 : The UK climbed out of the double-dip recession with a bang between July and September as the economy returned to growth at its fastest pace in five years, official figures showed today.
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Wednesday, September 26, 2012
UK retail sales report september 26 2012
UK retail sales outlook report september 26 2012 :
Confederation of British Industry Retail Survey (10:00 GMT) The number of retailers reporting an increase in sales volumes is expected to rise on a year-on-year basis in September, compared to August's flat sales growth.
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Saturday, September 1, 2012
Canadian interest rate forecast September 2012
Canadian interest rate forecast September 2012, cad forecast sept 2012 : Canada’s economic prospects should improve in tandem with the U.S. and the rest of the global economy over the next two years. In the meantime, a growth slowdown has materialized in Canada and looks to extend into 2013. Most recent data on employment, manufacturing, housing sales, and retail sales were on the downside.
Second quarter 2012 real GDP growth is estimated at 1.5 per cent compared to 1.9 per cent in the first quarter. Exports continue to grow during this recovery but the surge in automotive exports following the earlier supply disruptions is ending, which will leave total exports subject to current softer demand conditions.
In addition, the country’s merchandise trade deficit will likely worsen under the high Canadian dollar since it not only hinders exports but it facilitates imports. Real or price-adjusted imports have consistently outpaced exports since 2002 when the CAD was at its low with the USD. A trade deficit means a net outflow of income and results in lower economic growth.
Canada’s current slowdown will extend into the third quarter. A modest uplift is expected in the fourth quarter but another growth slowdown phase is likely in the second half of 2013 when U.S. fiscal tightening slows that economy. Growth in 2013 is downgraded to 2.0 per cent from 2.1 per cent. A stronger global economy will lift Canada’s growth to 2.6 per cent in 2014. Forecast risk is on the downside for the rest of 2012 and through 2013.
The lingering effects of the financial crisis on the U.S. economy combined with Europe’s worsening economy and several potentially inadequate key policy decisions in those countries could mean a weaker economy. Add to this backdrop one or more unexpected and sometimes random natural events that hurt the economy and the economy bounces around a sluggish growth trend.
Upside risks could be considerable if policymakers in Europe initiate substantive measures to deal with their sovereign debt problems and adopt growth-enhancing measures. Similarly in the U.S., politicians need to effectively deal with their fiscal problems both short and long term.
Inflation
The 12-month rate of CPI inflation slowed to 1.3 per cent in July, from 1.5 per cent in June and fell 0.1 per cent from June after decreasing 0.2 per cent the previous month.
The downward trend in CPI continued for the third straight month. The Bank of Canada’s core CPI was unchanged in July and was up 1.7 per cent from last July. Inflation will remain a non-issue for the Bank of Canada as long as excess capacity or a negative output gap exists in the economy.
A run-up in food prices due to the U.S. drought will take time to work its way through but higher food prices should boost headline CPI next year. The Bank’s core measure excludes some food items and it will not be moved by this temporary run-up.
Interest rates
Bond yields climbed 20 to 40 bps, depending on maturity term into mid-August from their July lows but reversed direction thereafter and retraced about 10 to 15 bps. Short market rates also moved up, though by a lesser amount since T-bill rates are anchored by the Bank of Canada’s policy rate.
Nonetheless, the Bank was prompted to engage in a Special Purchase and Resale Agreement of $370 million on August 16 in an effort to keep the overnight rate on target.
Market sentiment improved on better than expected U.S. payroll employment and retail sales data and a statement by the ECB president to support the euro along with plans for new sovereign bond buying program. Sentiment turned negative thereafter.
The only change in administered rates according to the Bank of Canada was a 10 bps increase late in the month to the posted three-year term mortgage rate to 4.05 per cent.
Monetary policy
No rate announcement was scheduled in August but the Governor of the Bank of Canada in a speech reiterated that some withdrawal of monetary stimulus would be forthcoming under the right conditions.
Based on the Bank’s economic forecast, those conditions could materialize around mid-2013 prompting it to act before the negative output gap closes by the end of 2013. The Bank is keen to raise rates.
The U.S. Federal Open Market Committee (FOMC) meeting did not generate additional monetary easing, though expectations are high. Some observers anticipate QE3 or some other unconventional monetary policy action such as buying MBS securities as early as September. The Fed will likely wait until after the election to act since the recovery is still intact and to avoid seen as politically inspired.
Interest rate forecast
An event-filled September will move bond yields in both directions and sometimes in large daily moves. Volatility aside, the trend in rates will be flat or trendless for another three or four quarters before some upward movement materializes later in 2013 and into 2014.
The futures market for three-month Bankers Acceptances is pricing a 25 bps rate increase around the first quarter of 2014 and about 50 bps by the end of 2014. However, the consensus economic forecast sees a 25 bps increase in Q3-2013 and 50 bps by the end of 2013.
This forecast puts the first BoC 25 bps increase in September 2013 followed by another in October before pausing into 2014 to assess the impact of those increases and on less than stellar economic prospects. Five-year posted mortgage rates have room to decline 10 to 15 bps in the near term and if the wide spread off the cost of funds does not prompt this move then perhaps the softening housing market and weakening mortgage demand will.
Source http://www.troymedia.com
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Second quarter 2012 real GDP growth is estimated at 1.5 per cent compared to 1.9 per cent in the first quarter. Exports continue to grow during this recovery but the surge in automotive exports following the earlier supply disruptions is ending, which will leave total exports subject to current softer demand conditions.
In addition, the country’s merchandise trade deficit will likely worsen under the high Canadian dollar since it not only hinders exports but it facilitates imports. Real or price-adjusted imports have consistently outpaced exports since 2002 when the CAD was at its low with the USD. A trade deficit means a net outflow of income and results in lower economic growth.
Canada’s current slowdown will extend into the third quarter. A modest uplift is expected in the fourth quarter but another growth slowdown phase is likely in the second half of 2013 when U.S. fiscal tightening slows that economy. Growth in 2013 is downgraded to 2.0 per cent from 2.1 per cent. A stronger global economy will lift Canada’s growth to 2.6 per cent in 2014. Forecast risk is on the downside for the rest of 2012 and through 2013.
The lingering effects of the financial crisis on the U.S. economy combined with Europe’s worsening economy and several potentially inadequate key policy decisions in those countries could mean a weaker economy. Add to this backdrop one or more unexpected and sometimes random natural events that hurt the economy and the economy bounces around a sluggish growth trend.
Upside risks could be considerable if policymakers in Europe initiate substantive measures to deal with their sovereign debt problems and adopt growth-enhancing measures. Similarly in the U.S., politicians need to effectively deal with their fiscal problems both short and long term.
Inflation
The 12-month rate of CPI inflation slowed to 1.3 per cent in July, from 1.5 per cent in June and fell 0.1 per cent from June after decreasing 0.2 per cent the previous month.
The downward trend in CPI continued for the third straight month. The Bank of Canada’s core CPI was unchanged in July and was up 1.7 per cent from last July. Inflation will remain a non-issue for the Bank of Canada as long as excess capacity or a negative output gap exists in the economy.
A run-up in food prices due to the U.S. drought will take time to work its way through but higher food prices should boost headline CPI next year. The Bank’s core measure excludes some food items and it will not be moved by this temporary run-up.
Interest rates
Bond yields climbed 20 to 40 bps, depending on maturity term into mid-August from their July lows but reversed direction thereafter and retraced about 10 to 15 bps. Short market rates also moved up, though by a lesser amount since T-bill rates are anchored by the Bank of Canada’s policy rate.
Nonetheless, the Bank was prompted to engage in a Special Purchase and Resale Agreement of $370 million on August 16 in an effort to keep the overnight rate on target.
Market sentiment improved on better than expected U.S. payroll employment and retail sales data and a statement by the ECB president to support the euro along with plans for new sovereign bond buying program. Sentiment turned negative thereafter.
The only change in administered rates according to the Bank of Canada was a 10 bps increase late in the month to the posted three-year term mortgage rate to 4.05 per cent.
Monetary policy
No rate announcement was scheduled in August but the Governor of the Bank of Canada in a speech reiterated that some withdrawal of monetary stimulus would be forthcoming under the right conditions.
Based on the Bank’s economic forecast, those conditions could materialize around mid-2013 prompting it to act before the negative output gap closes by the end of 2013. The Bank is keen to raise rates.
The U.S. Federal Open Market Committee (FOMC) meeting did not generate additional monetary easing, though expectations are high. Some observers anticipate QE3 or some other unconventional monetary policy action such as buying MBS securities as early as September. The Fed will likely wait until after the election to act since the recovery is still intact and to avoid seen as politically inspired.
Interest rate forecast
An event-filled September will move bond yields in both directions and sometimes in large daily moves. Volatility aside, the trend in rates will be flat or trendless for another three or four quarters before some upward movement materializes later in 2013 and into 2014.
The futures market for three-month Bankers Acceptances is pricing a 25 bps rate increase around the first quarter of 2014 and about 50 bps by the end of 2014. However, the consensus economic forecast sees a 25 bps increase in Q3-2013 and 50 bps by the end of 2013.
This forecast puts the first BoC 25 bps increase in September 2013 followed by another in October before pausing into 2014 to assess the impact of those increases and on less than stellar economic prospects. Five-year posted mortgage rates have room to decline 10 to 15 bps in the near term and if the wide spread off the cost of funds does not prompt this move then perhaps the softening housing market and weakening mortgage demand will.
Source http://www.troymedia.com
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Wednesday, August 29, 2012
official figures US economic growth q2 2012
official figures US economic growth q2 2012 : The US economy grew more than first estimated in the second quarter, according to official figures. The US grew at an annualised pace of 1.7% from April to June, more than the 1.5% previously estimated, the Commerce Department said.
This is a slowdown from 2% in the first three months of the year. The US Congress's budget office last week warned that spending cuts and tax rises could trigger a sharp economic slowdown in 2013.
In its report, the CBO said it expected the US recovery "to continue at a modest pace" for the rest of 2012 but warned that "substantial changes to tax and spending policies" would cause the US to tip back into recession next year.
The 1.7% annualised pace in the second quarter is equivalent to 0.43% quarter-on-quarter growth. That compares with 0.38% quarterly growth in the previous estimate.
The unemployment rate is currently above 8%.
The economy is shaping up to be one of the biggest issues of this year's US presidential election, which sees President Barack Obama take on Republican rival Mitt Romney.
Federal Reserve chairman Ben Bernanke may offer further thoughts on the state of the economy when he gives a speech at the central bank's annual gathering in Jackson Hole, Wyoming, at the end of this week.
For the past two years, Mr Bernanke has used the event, a conference of the world's central bankers, to indicate the Fed's intentions.
The Fed has kept base interest rates at close to zero for nearly four years and pumped $2.3 trillion into the economy.
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This is a slowdown from 2% in the first three months of the year. The US Congress's budget office last week warned that spending cuts and tax rises could trigger a sharp economic slowdown in 2013.
In its report, the CBO said it expected the US recovery "to continue at a modest pace" for the rest of 2012 but warned that "substantial changes to tax and spending policies" would cause the US to tip back into recession next year.
The 1.7% annualised pace in the second quarter is equivalent to 0.43% quarter-on-quarter growth. That compares with 0.38% quarterly growth in the previous estimate.
The unemployment rate is currently above 8%.
The economy is shaping up to be one of the biggest issues of this year's US presidential election, which sees President Barack Obama take on Republican rival Mitt Romney.
Federal Reserve chairman Ben Bernanke may offer further thoughts on the state of the economy when he gives a speech at the central bank's annual gathering in Jackson Hole, Wyoming, at the end of this week.
For the past two years, Mr Bernanke has used the event, a conference of the world's central bankers, to indicate the Fed's intentions.
The Fed has kept base interest rates at close to zero for nearly four years and pumped $2.3 trillion into the economy.
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Sunday, August 26, 2012
German business climate outlook report 8/27/2012
German business climate outlook report 8/27/2012 : the Ifo Institute for Economic Research is to release a report on German business climate, a leading indicator of economic health.
A slew of data next week will show how badly Germany has been scarred by the euro zone crisis as its companies fear for key European export markets and the only vital support comes from consumers.
Three years into the debt crisis, growth in Europe's largest economy slowed in the second quarter of 2012 to 0.3 percent and a string of increasingly gloomy data has even raised the possibility of a second-half contraction.
The Ifo business climate index, Germany's most influential leading indicator of economic health, is forecast to slip for the fourth month in a row, confirming a change in trend.
"The economy has slowed significantly. The German economy will likely weaken slightly in the second half," said Commerzbank economist Ralph Solveen. "For a long time the debt crisis seemed not to bother German businesses. Only in the last three months Ifo has fallen significantly."
Ifo, seen down at an almost 3-1/2 year low of 102.6 from 103.3 in July, should confirm what hard data from the Purchasing Managers' Indicator (PMI) already showed this week: Germany's hitherto steady resilience to the crisis is waning.
Orders from abroad for Germany's manufacturing goods, a mainstay for the economy, fell this month at the fastest rate since April 2009. That will likely be reflected in Ifo's sub-index on business expectations, which is also seen dropping for a fourth consecutive month.
The slowdown carries risks for German Chancellor Angela Merkel as she seeks a third term in office next year and could tie her hands when it comes to bailing out indebted peers, especially if a nascent rise in unemployment accelerates.
For August, unemployment is expected to stay at 6.8 percent, still near post-reunification lows but following four months of rises in the number of people out of a job. Jobless data are due on Thursday.
While businesses are feeling the pain, consumers have so far continued to spend, mostly on big-ticket items, as low interest rates make saving unattractive. The GfK consumer sentiment survey, due out on Tuesday, is expected to be unchanged going into September after inching higher a month earlier.
Inflation is expected to tick up to 1.8 percent - or 2.0 using the EU measure - but policy makers do not see that as a risk to the economy.
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A slew of data next week will show how badly Germany has been scarred by the euro zone crisis as its companies fear for key European export markets and the only vital support comes from consumers.
Three years into the debt crisis, growth in Europe's largest economy slowed in the second quarter of 2012 to 0.3 percent and a string of increasingly gloomy data has even raised the possibility of a second-half contraction.
The Ifo business climate index, Germany's most influential leading indicator of economic health, is forecast to slip for the fourth month in a row, confirming a change in trend.
"The economy has slowed significantly. The German economy will likely weaken slightly in the second half," said Commerzbank economist Ralph Solveen. "For a long time the debt crisis seemed not to bother German businesses. Only in the last three months Ifo has fallen significantly."
Ifo, seen down at an almost 3-1/2 year low of 102.6 from 103.3 in July, should confirm what hard data from the Purchasing Managers' Indicator (PMI) already showed this week: Germany's hitherto steady resilience to the crisis is waning.
Orders from abroad for Germany's manufacturing goods, a mainstay for the economy, fell this month at the fastest rate since April 2009. That will likely be reflected in Ifo's sub-index on business expectations, which is also seen dropping for a fourth consecutive month.
The slowdown carries risks for German Chancellor Angela Merkel as she seeks a third term in office next year and could tie her hands when it comes to bailing out indebted peers, especially if a nascent rise in unemployment accelerates.
For August, unemployment is expected to stay at 6.8 percent, still near post-reunification lows but following four months of rises in the number of people out of a job. Jobless data are due on Thursday.
While businesses are feeling the pain, consumers have so far continued to spend, mostly on big-ticket items, as low interest rates make saving unattractive. The GfK consumer sentiment survey, due out on Tuesday, is expected to be unchanged going into September after inching higher a month earlier.
Inflation is expected to tick up to 1.8 percent - or 2.0 using the EU measure - but policy makers do not see that as a risk to the economy.
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Wednesday, August 22, 2012
US Unemployment Claims report 23 august 2012
US Unemployment Claims report 23 august 2012 : Several key reports will be made available on Thursday, including the Unemployment Claims report in the United States, which will be released at 12:30pm GMT. Also in the U.S., the New Home Sales numbers will be made available.
US Unemployment Claims forecast
US 4-Week Moving Average of Initial Claims for Unemployment Insurance is at a current level of 363.75K, a decrease of 5.50K or 1.49% from last week. This is a decrease of 42.25K or 10.41% from last year and is higher than the long term average of 363.53K.
US Unemployment Claims report 23 august 2012
According to the Labor Department, the americans that filed in their first initial claims for regular state unemployment-insurance benefits rose by 4K last week to a seasonally adjusted 372K in the week ended August 18, missing expectations at 365K and coming from 368K (revised) in the previous print.
Continuing claims, which reflect people already receiving benefits, rose by 4K to a seasonally adjusted 3.317 million in the week ended August 4 vs. 3.313 million in the previous week (revised).
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US Unemployment Claims forecast
US 4-Week Moving Average of Initial Claims for Unemployment Insurance is at a current level of 363.75K, a decrease of 5.50K or 1.49% from last week. This is a decrease of 42.25K or 10.41% from last year and is higher than the long term average of 363.53K.
US Unemployment Claims report 23 august 2012
According to the Labor Department, the americans that filed in their first initial claims for regular state unemployment-insurance benefits rose by 4K last week to a seasonally adjusted 372K in the week ended August 18, missing expectations at 365K and coming from 368K (revised) in the previous print.
Continuing claims, which reflect people already receiving benefits, rose by 4K to a seasonally adjusted 3.317 million in the week ended August 4 vs. 3.313 million in the previous week (revised).
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July US Existing Home Sales report 22 august 2012
July US Existing Home Sales report 22 august 2012 : Home resales rose in July as low interest rates and a modest improvement in the labor market helped home buying conditions, the National Association of Realtors said on Wednesday.
The NAR said existing home sales rose 2.3 percent to an annual rate of 4.47 million units last month. That was just below analysts' expectations of a 4.52 million-unit rate.
Nationwide, the median price for a home resale was $187,300 in July, 9.4 percent higher than in the same month a year earlier.
"Mortgage interest rates have been at record lows this year," said NAR chief economist Lawrence Yun, adding that the labor market was also showing signs of improvement. "Combined, these factors are helping to unleash pent up demand."
The U.S. housing market, which began falling into a deep rut six years ago, has been a relative bright spot in the economy this year. Home prices have shown signs of stabilizing and many economists think residential construction will give a slight boost to the economy this year.
But home building now plays a much smaller economic role than it did before the 2007-2009 recession, and a turn for the worse in the broader economy could easily undo housing's incipient recovery.
Barring potential problems from abroad like a worsening in Europe's debt crisis, most economists expect U.S. economic growth will pick up in the second half of the year but still be lackluster.
A separate report showed applications for U.S. home mortgages tumbled last week, with demand for refinancing drying up as mortgage rates jumped to their highest level since late June.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 7.4 percent in the week ended Aug 17.
Fixed 30-year mortgage rates jumped 10 basis points to average 3.86 percent. Even with the increase, rates are still at relatively cheap levels after falling to record lows in recent months. Source http://www.reuters.com
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The NAR said existing home sales rose 2.3 percent to an annual rate of 4.47 million units last month. That was just below analysts' expectations of a 4.52 million-unit rate.
Nationwide, the median price for a home resale was $187,300 in July, 9.4 percent higher than in the same month a year earlier.
"Mortgage interest rates have been at record lows this year," said NAR chief economist Lawrence Yun, adding that the labor market was also showing signs of improvement. "Combined, these factors are helping to unleash pent up demand."
The U.S. housing market, which began falling into a deep rut six years ago, has been a relative bright spot in the economy this year. Home prices have shown signs of stabilizing and many economists think residential construction will give a slight boost to the economy this year.
But home building now plays a much smaller economic role than it did before the 2007-2009 recession, and a turn for the worse in the broader economy could easily undo housing's incipient recovery.
Barring potential problems from abroad like a worsening in Europe's debt crisis, most economists expect U.S. economic growth will pick up in the second half of the year but still be lackluster.
A separate report showed applications for U.S. home mortgages tumbled last week, with demand for refinancing drying up as mortgage rates jumped to their highest level since late June.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 7.4 percent in the week ended Aug 17.
Fixed 30-year mortgage rates jumped 10 basis points to average 3.86 percent. Even with the increase, rates are still at relatively cheap levels after falling to record lows in recent months. Source http://www.reuters.com
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Saturday, August 18, 2012
Economic calendar week august 20-24 2012
Economic calendar week august 20-24 2012 : The minutes of the July 31-Aug. 1 meeting of the Federal Open Market Committee, to be released on Wednesday, will dominate markets in a week light on data.
The minutes from the FOMC meeting have the potential to be market-moving: They may reveal how eager Fed officials are to ease further and what conditions might make additional easing more likely. Overall, the minutes should have a distinctly dovish tone that may revive optimism that the Fed will launch additional easing soon.
U.S. housing data -- existing and new home sales -- should show a continued modest gain in housing demand.
The main euro zone event of the week will be the publication of the latest composite Purchasing Managers' Index figures, which are expected to provide firmer signs that the region is officially in recession.
Below are entries on the economic calendar Aug. 20-24. All listed times are EDT.
Monday, august 20, 2012
8:30 a.m. -- The Chicago Fed Midwest Manufacturing Index for July.
Non-U.S.
E17 -- June construction output
Thailand -- Q2 GDP
Chile -- Q2 GDP
Tuesday, august 21 2012
8:45 a.m. -- Atlanta Fed President Dennis Lockhart (FOMC voter) speaks at the Latin American Chamber of Commerce and the World Affairs Council on the topic "The U.S. economic outlook and implications for Latin America" in Georgia.
Non-U.S.
Australia -- Reserve Bank of Australia board minutes for August
Norway -- Central Bank Governor Oeystein Olsen speaks to Norwegian diplomatic representative in Oslo.
Japan -- Index of all-industry activity for June and trade balance for July
Poland -- July core inflation
Wednesday, August 22, 2012
7:00 a.m. -- Mortgage Bankers Association's mortgage index for the week ending Aug. 17
10:00 a.m. -- Economists expect existing home sales to rise 3.8 percent in July to 4.52 million units after tumbling 5.4 percent in June.
10:30 a.m. -- Crude oil inventories for the week ending Aug. 17
2:00 p.m. -- The Federal Open Market Committee releases minutes from its July 31-Aug. 1 meeting. Because the FOMC did not release updated forecasts at the August meeting, the discussion may also give some insight into how Fed officials' views on the outlook are evolving. The Fed added two phrases to their policy guidance in the August statement: that they will "closely monitor incoming information" and that they "will provide additional accommodation as needed." Details about how the voting members decided on this language change could also be informative. The June minutes note that "several participants commented that it would be desirable to explore the possibility of developing new tools," so any discussion of such "new tools" would be noteworthy as well. All told, the minutes should have a distinctly dovish tone that may revive optimism that the Fed will launch additional easing soon.
Non-U.S.
Norway -- June unemployment rate
South Africa -- July CPI
Brazil -- June economic activity index
8:30 a.m. -- Economists look for initial jobless claims to edge down to 365,000 for the week ending Aug. 17, from 366,000 in the prior week.
8:58 a.m. -- Markit Flash Manufacturing PMI likely fell to 51.3 in August, from 51.4 in July.
10:00 a.m. -- The FHFA Home Price Index probably rose 0.3 percent in June, after rising 0.8 percent in May.
10:00 a.m. -- Economists look for new home sales to increase just more than 4 percent to 365,000 in July. This will partly reverse the 8.4 percent drop in June.
Non-U.S.
China -- HSBC flash manufacturing PMI index for August
Singapore -- July CPI
Germany -- Q2 GDP, final reading
Norway -- Q2 GDP
Mexico -- Q2 nominal GDP
E17 -- August flash consumer confidence index
E17 -- August flash manufacturing PMI index and flash services PMI index
France -- August flash manufacturing PMI index and flash services PMI index
Germany -- August flash manufacturing PMI index and flash services PMI index
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The minutes from the FOMC meeting have the potential to be market-moving: They may reveal how eager Fed officials are to ease further and what conditions might make additional easing more likely. Overall, the minutes should have a distinctly dovish tone that may revive optimism that the Fed will launch additional easing soon.
U.S. housing data -- existing and new home sales -- should show a continued modest gain in housing demand.
The main euro zone event of the week will be the publication of the latest composite Purchasing Managers' Index figures, which are expected to provide firmer signs that the region is officially in recession.
Below are entries on the economic calendar Aug. 20-24. All listed times are EDT.
Monday, august 20, 2012
8:30 a.m. -- The Chicago Fed Midwest Manufacturing Index for July.
Non-U.S.
E17 -- June construction output
Thailand -- Q2 GDP
Chile -- Q2 GDP
Tuesday, august 21 2012
8:45 a.m. -- Atlanta Fed President Dennis Lockhart (FOMC voter) speaks at the Latin American Chamber of Commerce and the World Affairs Council on the topic "The U.S. economic outlook and implications for Latin America" in Georgia.
Non-U.S.
Australia -- Reserve Bank of Australia board minutes for August
Norway -- Central Bank Governor Oeystein Olsen speaks to Norwegian diplomatic representative in Oslo.
Japan -- Index of all-industry activity for June and trade balance for July
Poland -- July core inflation
Wednesday, August 22, 2012
7:00 a.m. -- Mortgage Bankers Association's mortgage index for the week ending Aug. 17
10:00 a.m. -- Economists expect existing home sales to rise 3.8 percent in July to 4.52 million units after tumbling 5.4 percent in June.
10:30 a.m. -- Crude oil inventories for the week ending Aug. 17
2:00 p.m. -- The Federal Open Market Committee releases minutes from its July 31-Aug. 1 meeting. Because the FOMC did not release updated forecasts at the August meeting, the discussion may also give some insight into how Fed officials' views on the outlook are evolving. The Fed added two phrases to their policy guidance in the August statement: that they will "closely monitor incoming information" and that they "will provide additional accommodation as needed." Details about how the voting members decided on this language change could also be informative. The June minutes note that "several participants commented that it would be desirable to explore the possibility of developing new tools," so any discussion of such "new tools" would be noteworthy as well. All told, the minutes should have a distinctly dovish tone that may revive optimism that the Fed will launch additional easing soon.
Non-U.S.
Norway -- June unemployment rate
South Africa -- July CPI
Brazil -- June economic activity index
8:30 a.m. -- Economists look for initial jobless claims to edge down to 365,000 for the week ending Aug. 17, from 366,000 in the prior week.
8:58 a.m. -- Markit Flash Manufacturing PMI likely fell to 51.3 in August, from 51.4 in July.
10:00 a.m. -- The FHFA Home Price Index probably rose 0.3 percent in June, after rising 0.8 percent in May.
10:00 a.m. -- Economists look for new home sales to increase just more than 4 percent to 365,000 in July. This will partly reverse the 8.4 percent drop in June.
Non-U.S.
China -- HSBC flash manufacturing PMI index for August
Singapore -- July CPI
Germany -- Q2 GDP, final reading
Norway -- Q2 GDP
Mexico -- Q2 nominal GDP
E17 -- August flash consumer confidence index
E17 -- August flash manufacturing PMI index and flash services PMI index
France -- August flash manufacturing PMI index and flash services PMI index
Germany -- August flash manufacturing PMI index and flash services PMI index
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Sunday, August 12, 2012
Financial Markets for august 13 -17 2012
Financial Markets for august 13 -17 2012, Economic Calendar august 13 -17 2012 : There are several important publications and reports that may affect the financial markets including: U.S Philly fed index, Euro Area GDP for Q2 2012, U.S PPI, minutes of BOJ monetary policy, U.S housing starts, Canada and America’s CPI, and U.S. jobless claims. Here is an economic news calendar outlook for August 13th to August 17th regarding the U.S., EU, Japan, GB and Canada.
Monday, August 13th
00:50 –Minutes of the recent Japanese monetary policy meeting:
Following last week’s BOJ monetary policy meeting – the Bank members decided to keep the policy unchanged and the interest rate remained at 0 to 0.1 percent – the Bank of Japan will publish the minutes of the recent meeting. If the minutes will reveal any hints for the future steps of BOJ it may affect the Japanese yen and consequently commodities prices;
Tuesday, August 14th
09:30 – Great Britain CPI:
this report will refer to the yearly rate of GB’s consumer price index as of July 2012; some expect the July inflation will further decline; in the recent report regarding June the annual CPI decreased from 2.8% to 2.4%; this news may affect the British pound;
10:00– Euro Area GDP 2Q2012 Report:
Germany France and Italy will also publish during the day their preliminary second quarter GDP report for 2012. This report will show the changes in the economic growth in these countries; Euro Stat will also publish the GDP growth rate of the Euro Area. According to the previous report, during the first quarter of 2012, the Euro Area GDP didn’t grow (Q-o-Q). This news might affect the Euro; the current expectations are of another a low growth rate or even another contraction for the second quarter;
10:00 –German ZEW economic sentiment:
The upcoming publication will refer to the ZEW indicator of economic sentiment for Germany for August. During July the ZEW indicator for Germany rose by 1.7 points to -19.6 points; if Germany’s economic sentiment will continue to dwindle, the Euro will plausibly remain weak against other currencies;
10:00 –Euro Area ZEW economic sentiment:
The upcoming publication will refer to the ZEW indicator of economic sentiment for Euro Area for August 2012. For July 2012 the ZEW indicator for Euro Area fell to -22.3;
10:00– Euro Area Industrial Production:
This report will show the changes in the industrial production of the EU during June; in the previous report the EU industrial production was up by 0.6% (M-O-M) during May;
13:30 –U.S. Retail Sales Report:
this report will show the monthly changes in the retail sales and food services for July 2012; in the recent report regarding June, the retail sales declined by 0.5% from the previous month; gasoline stations sales decreased by 1.8% in June compared to May; this report could signal the changes in U.S’s gasoline demand and thus may affect crude oil prices;
13:30 – U.S. Producer Price Index:
09:30 – MPC Meeting Minutes:
in the recent MPC meeting it was announced the rate will remain flat at 0.5% and the asset purchase program will remain at £375 billion; the MPC still has concerns about inflation. The minutes of the recent meeting might offer some insight behind this decision;
13:30 –U.S Core Consumer Price Index:
This monthly report will refer to the main changes in the core consumer price index for July 2012. According to the U.S Bureau of Labor statistics during June, the core CPI rose by 0.2%(M-o-M) and the index increased over the last 12 months by 2.2%; the CPI remained unchanged last month;
14:00 – U.S. TIC Long Term Purchases:
The Treasury International Capital report will present the changes in the purchases and sales of US long term treasuries in June 2012. In the previous report regarding May 2012, the net foreign sales of U.S Treasuries longer-term notes reached $55 billion;
15:30 – U.S Crude Oil Stockpiles Report: the EIA (Energy Information Administration ) will publish its weekly report on the U.S oil and petroleum stockpiles for the week ending on August 10th; in the recent weekly update for August 3rd, stockpiles slipped by 1 million bl to 1,800 million bl;
Thursday, August 16th
09:30 –Retails Sales GB (July 2012):
13:00 – Canada’s Core CPI:
This report will refer to the core consumer price index for July 2012 and controlling the volatile components such as energy, fruit and vegetables. According to the Canadian CPI report for June 2012, the CPI rose by 1.5% during the past 12 month up to June – this is a slightly higher rate than in May. This report might affect the Canadian dollar, which is also strongly linked with commodities prices;
14:55 – UoM Consumer Sentiment (preliminary):
University of Michigan will issue its preliminary consumer sentiment survey; this report could offer another perceptive to recent changes in U.S consumers sentiment about the economy; last time the sentiment index fell to 72;
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Monday, August 13th
00:50 –Minutes of the recent Japanese monetary policy meeting:
Following last week’s BOJ monetary policy meeting – the Bank members decided to keep the policy unchanged and the interest rate remained at 0 to 0.1 percent – the Bank of Japan will publish the minutes of the recent meeting. If the minutes will reveal any hints for the future steps of BOJ it may affect the Japanese yen and consequently commodities prices;
Tuesday, August 14th
09:30 – Great Britain CPI:
this report will refer to the yearly rate of GB’s consumer price index as of July 2012; some expect the July inflation will further decline; in the recent report regarding June the annual CPI decreased from 2.8% to 2.4%; this news may affect the British pound;
10:00– Euro Area GDP 2Q2012 Report:
Germany France and Italy will also publish during the day their preliminary second quarter GDP report for 2012. This report will show the changes in the economic growth in these countries; Euro Stat will also publish the GDP growth rate of the Euro Area. According to the previous report, during the first quarter of 2012, the Euro Area GDP didn’t grow (Q-o-Q). This news might affect the Euro; the current expectations are of another a low growth rate or even another contraction for the second quarter;
10:00 –German ZEW economic sentiment:
The upcoming publication will refer to the ZEW indicator of economic sentiment for Germany for August. During July the ZEW indicator for Germany rose by 1.7 points to -19.6 points; if Germany’s economic sentiment will continue to dwindle, the Euro will plausibly remain weak against other currencies;
10:00 –Euro Area ZEW economic sentiment:
The upcoming publication will refer to the ZEW indicator of economic sentiment for Euro Area for August 2012. For July 2012 the ZEW indicator for Euro Area fell to -22.3;
10:00– Euro Area Industrial Production:
This report will show the changes in the industrial production of the EU during June; in the previous report the EU industrial production was up by 0.6% (M-O-M) during May;
13:30 –U.S. Retail Sales Report:
this report will show the monthly changes in the retail sales and food services for July 2012; in the recent report regarding June, the retail sales declined by 0.5% from the previous month; gasoline stations sales decreased by 1.8% in June compared to May; this report could signal the changes in U.S’s gasoline demand and thus may affect crude oil prices;
13:30 – U.S. Producer Price Index:
This report will present the progress in the PPI during July 2012, i.e. the inflation rate from the producers’ stand point. In the recent report regarding June this index for finished goods edged up by 0.1% compared with May’s rate and increased by 0.7% in the last 12 months; this news might affect gold and silver prices;
Wednesday, August 15th
Wednesday, August 15th
09:30 – MPC Meeting Minutes:
in the recent MPC meeting it was announced the rate will remain flat at 0.5% and the asset purchase program will remain at £375 billion; the MPC still has concerns about inflation. The minutes of the recent meeting might offer some insight behind this decision;
13:30 –U.S Core Consumer Price Index:
This monthly report will refer to the main changes in the core consumer price index for July 2012. According to the U.S Bureau of Labor statistics during June, the core CPI rose by 0.2%(M-o-M) and the index increased over the last 12 months by 2.2%; the CPI remained unchanged last month;
14:00 – U.S. TIC Long Term Purchases:
The Treasury International Capital report will present the changes in the purchases and sales of US long term treasuries in June 2012. In the previous report regarding May 2012, the net foreign sales of U.S Treasuries longer-term notes reached $55 billion;
15:30 – U.S Crude Oil Stockpiles Report: the EIA (Energy Information Administration ) will publish its weekly report on the U.S oil and petroleum stockpiles for the week ending on August 10th; in the recent weekly update for August 3rd, stockpiles slipped by 1 million bl to 1,800 million bl;
Thursday, August 16th
09:30 –Retails Sales GB (July 2012):
This report examines the shifts in the retails sales in Great Britain during July 2012. It may affect the direction of the British Pound exchange rate. In the previous report regarding June 2012, retails sales edged up by 0.1%;
13:30 – U.S. Housing Starts:
the U.S Census Bureau will publish the U.S housing starts update for July 2012; this report was historically correlated with gold price – as housing starts increased, gold prices tended to fall the following day (even when controlling to the U.S dollar effect); in the previous report, the adjusted annual rate reached 760,000 in June 2012, which was 6.9% above May’s rate;
13:30 – U.S. Building Permits:
The latest report building permits declined by 3.7% (M-o-M) in the adjusted annual rate of building permits and reached 755,000 in June 2012. If this report will continue to decline in the building permits rate, it may indicate that the U.S housing market (from this aspect) is slowing down (the recent U.S building permits and housing starts review);
13:30 – U.S. Jobless Claims Weekly Report:
this update will pertain to the weekly changes in the initial jobless claims for the week ending on August 10th; in the recent update the jobless claims fell by 6k to 361,000; this upcoming weekly report may affect the U.S dollar and consequently commodities prices;
15:00 – Philly Fed Manufacturing Index:
This monthly survey presents an estimate for the changes of the US economy; it measures the manufacturing conditions. In the previous July survey, the growth rate rose from -12.9 in July to -16.6 in June 2012. If the index will remain negative it may adversely affect not only U.S Dollar but also American stock indexes, and commodities prices (the recent Philly Fed review);
15:30 – EIA U.S. Natural Gas Storage Update:
the EIA weekly report of the U.S. natural gas market will refer to the recent developments in natural gas production, storage, consumption and prices as of August 10th; in the previous weekly update, natural gas storage rose by 24 Bcf to 3,241 Bcf;
Friday August 17th
13:30 – U.S. Housing Starts:
the U.S Census Bureau will publish the U.S housing starts update for July 2012; this report was historically correlated with gold price – as housing starts increased, gold prices tended to fall the following day (even when controlling to the U.S dollar effect); in the previous report, the adjusted annual rate reached 760,000 in June 2012, which was 6.9% above May’s rate;
13:30 – U.S. Building Permits:
The latest report building permits declined by 3.7% (M-o-M) in the adjusted annual rate of building permits and reached 755,000 in June 2012. If this report will continue to decline in the building permits rate, it may indicate that the U.S housing market (from this aspect) is slowing down (the recent U.S building permits and housing starts review);
13:30 – U.S. Jobless Claims Weekly Report:
this update will pertain to the weekly changes in the initial jobless claims for the week ending on August 10th; in the recent update the jobless claims fell by 6k to 361,000; this upcoming weekly report may affect the U.S dollar and consequently commodities prices;
15:00 – Philly Fed Manufacturing Index:
This monthly survey presents an estimate for the changes of the US economy; it measures the manufacturing conditions. In the previous July survey, the growth rate rose from -12.9 in July to -16.6 in June 2012. If the index will remain negative it may adversely affect not only U.S Dollar but also American stock indexes, and commodities prices (the recent Philly Fed review);
15:30 – EIA U.S. Natural Gas Storage Update:
the EIA weekly report of the U.S. natural gas market will refer to the recent developments in natural gas production, storage, consumption and prices as of August 10th; in the previous weekly update, natural gas storage rose by 24 Bcf to 3,241 Bcf;
Friday August 17th
13:00 – Canada’s Core CPI:
This report will refer to the core consumer price index for July 2012 and controlling the volatile components such as energy, fruit and vegetables. According to the Canadian CPI report for June 2012, the CPI rose by 1.5% during the past 12 month up to June – this is a slightly higher rate than in May. This report might affect the Canadian dollar, which is also strongly linked with commodities prices;
14:55 – UoM Consumer Sentiment (preliminary):
University of Michigan will issue its preliminary consumer sentiment survey; this report could offer another perceptive to recent changes in U.S consumers sentiment about the economy; last time the sentiment index fell to 72;
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Wednesday, August 8, 2012
U.S. unemployment rate outlook july 2012
U.S. unemployment rate outlook july 2012 : The comments came after data last week showing that the U.S. unemployment rate unexpectedly ticked up to 8.3% in July, from 8.2% the previous month.
Despite the loss of around 1,000 jobs in June, unemployment in the United States construction industry has dropped to four-year lows, the latest figures from the US Department of Labour suggest.
Though overall employment levels throughout the industry remain flat and the decline in unemployment rates is thought to be a reflection of seasonal influences and workers leaving the industry, the news is being treated in a broadly positive light.
According to the latest figures from the US Department of Labour, the construction industry unemployment rate throughout the US dropped from 12.8 per cent in June to 12.3 per cent last month, the lowest level on record since 2008.
But while the drop in unemployment came as welcome news, actual employment levels fell by 1,000 (not seasonally adjusted) and remain virtually unchanged during the year, meaning that conditions in the country’s construction labour market are not strong.
Consistent with the combination of a strengthening residential sector but stagnant conditions outside of housing, the non-residential sector is leading the employment decline.
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Despite the loss of around 1,000 jobs in June, unemployment in the United States construction industry has dropped to four-year lows, the latest figures from the US Department of Labour suggest.
Though overall employment levels throughout the industry remain flat and the decline in unemployment rates is thought to be a reflection of seasonal influences and workers leaving the industry, the news is being treated in a broadly positive light.
According to the latest figures from the US Department of Labour, the construction industry unemployment rate throughout the US dropped from 12.8 per cent in June to 12.3 per cent last month, the lowest level on record since 2008.
But while the drop in unemployment came as welcome news, actual employment levels fell by 1,000 (not seasonally adjusted) and remain virtually unchanged during the year, meaning that conditions in the country’s construction labour market are not strong.
Consistent with the combination of a strengthening residential sector but stagnant conditions outside of housing, the non-residential sector is leading the employment decline.
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U.S. Food Prices forecast 2013
U.S. Food Prices forecast 2013 : The U.S. Department of Agriculture (USDA) on July 25 issued a report warning every American that U.S. food prices in 2013 will rise 3%-4% -- but that jump is just the start of a frightening long-term trend.
The warm weather in the winter months gave farmers hope for a great crop production this year, but a crippling U.S. drought now covers around 60% of the continental United States. the looming U.S. food price increase in 2013 is just the beginning, and the reasons go far beyond the current drought.
Add in the USDA's recent report that U.S. beef consumption fell for the sixth consecutive year in 2011, and their forecast that consumption will drop to 11.359 million tons in 2012, the lowest level since 1993, and you can see why some traders sold over the past few months.
However, there are many reasons why cattle prices should quickly rebound. Cattle futures could hit a record $1.33 a pound by year-end according to Ron Plain, a livestock economist and advisor to the USDA. Among them:
While U.S. beef consumption is easing (because of both cost and trends in health consciousness), export demand for U.S. meat is rising - to an estimated 2.675 billion pounds this year, the highest level ever.
The size of the U.S. cattle herd fell to 90.77 million head at the end of 2011, smallest since 1952, as U.S. ranchers culled stock to battle severe drought, skyrocketing feed prices and shrinking margins.
The loss of breeding stock as a result of smaller herds means a continued low cattle population, with calf production this year dropping to the lowest levels since 1950.
The USDA estimates beef production will drop 2% to 24.671 billion pounds next year, the lowest output since 1993.
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The warm weather in the winter months gave farmers hope for a great crop production this year, but a crippling U.S. drought now covers around 60% of the continental United States. the looming U.S. food price increase in 2013 is just the beginning, and the reasons go far beyond the current drought.
Add in the USDA's recent report that U.S. beef consumption fell for the sixth consecutive year in 2011, and their forecast that consumption will drop to 11.359 million tons in 2012, the lowest level since 1993, and you can see why some traders sold over the past few months.
However, there are many reasons why cattle prices should quickly rebound. Cattle futures could hit a record $1.33 a pound by year-end according to Ron Plain, a livestock economist and advisor to the USDA. Among them:
While U.S. beef consumption is easing (because of both cost and trends in health consciousness), export demand for U.S. meat is rising - to an estimated 2.675 billion pounds this year, the highest level ever.
The size of the U.S. cattle herd fell to 90.77 million head at the end of 2011, smallest since 1952, as U.S. ranchers culled stock to battle severe drought, skyrocketing feed prices and shrinking margins.
The loss of breeding stock as a result of smaller herds means a continued low cattle population, with calf production this year dropping to the lowest levels since 1950.
The USDA estimates beef production will drop 2% to 24.671 billion pounds next year, the lowest output since 1993.
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Saturday, August 4, 2012
China inflation rate forecast july 2012
China inflation rate forecast july 2012, China CPI july 2012 : China inflation, production, credit and trade data july 2012 : China's inflation rate is likely to fall below 2 percent in July due to the base effect, giving authorities more room to beef up monetary supply to support growth, according to the latest bank estimations.
The consumer price index, a key gauge of inflation, will rise 1.7 percent year-on-year in July, slower than the 2.2-percent growth seen in June, the Bank of Communications and the Industrial Bank said in their monthly economic data forecast reports.
Both banks attributed the easing inflation to the base effect. The CPI growth rate hit a 37-month high of 6.5 percent in July last year before gradually retreating as China's economy slowed for eight quarters running.
The inflation rate will remain at around 2 percent throughout the third quarter if no new factors emerge to drive prices up, the financial research center of Bank of Communications projected.
Food prices, which account for nearly one-third of the prices used to calculate China's CPI, may stay flat in July compared with June, as rain and flooding affected vegetable production in many places in a traditionally peak season of supply, it said.
Non-food prices will increase about 0.1 percent in July from June on rising prices in transport, telecommunications, entertainment and housing, Industrial Bank noted in its report.
The central bank is likely to further reduce the reserve requirement ratio, the money that lenders should set aside in reserves, in August to shore up the softening economy, said Lu Zhengwei, chief economist with Industrial Bank.
China's central bank has cut the RRR three times since November. It also slashed benchmark interest rates for the first time since December 2008 in June and further reduced the rates earlier this month.
China manufacturing forecast july 2012
China’s manufacturing teetered on the edge of contraction in July and South Korea’s exports and inflation declined, indicating that stimulus efforts have yet to bear fruit.
The Purchasing Managers’ Index in China unexpectedly fell to 50.1 in July, the weakest in eight months, from 50.2 in June, a government report showed today. Fifty marks the dividing line between expansion and contraction. South Korea’s exports slid by more than double the amount forecast by analysts and inflation moderated to a 12-year low.
The data increase odds China and South Korea will add to interest-rate cuts in the coming months as a record-high jobless rate in the euro area drags on global growth. Leaders of China’s ruling Communist Party pledged yesterday to keep adjusting policies to ensure stable growth while signs of a revival in the housing market may improve chances of reversing the nation’s slowdown.
“It’s almost certain that there will be more loosening,” said Daniel Martin, Singapore-based Asia economist at Capital Economics Ltd. “The whole region is going to see fairly disappointing growth this year.” He sees at one more interest- rate cut in China and at least one more this year by South Korea.
The reading today from the Beijing-based National Bureau of Statistics and China Federation of Logistics and Purchasing and compares with the 50.5 median estimate in a Bloomberg News survey.
Three of 24 economists surveyed had forecast a decline in the gauge from June. The report showed indexes of output and new export orders were at the lowest levels since November, while a new orders gauge showed a contraction for a third month and employment declined. A reading on imports was the weakest since February 2009.
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The consumer price index, a key gauge of inflation, will rise 1.7 percent year-on-year in July, slower than the 2.2-percent growth seen in June, the Bank of Communications and the Industrial Bank said in their monthly economic data forecast reports.
Both banks attributed the easing inflation to the base effect. The CPI growth rate hit a 37-month high of 6.5 percent in July last year before gradually retreating as China's economy slowed for eight quarters running.
The inflation rate will remain at around 2 percent throughout the third quarter if no new factors emerge to drive prices up, the financial research center of Bank of Communications projected.
Food prices, which account for nearly one-third of the prices used to calculate China's CPI, may stay flat in July compared with June, as rain and flooding affected vegetable production in many places in a traditionally peak season of supply, it said.
Non-food prices will increase about 0.1 percent in July from June on rising prices in transport, telecommunications, entertainment and housing, Industrial Bank noted in its report.
The central bank is likely to further reduce the reserve requirement ratio, the money that lenders should set aside in reserves, in August to shore up the softening economy, said Lu Zhengwei, chief economist with Industrial Bank.
China's central bank has cut the RRR three times since November. It also slashed benchmark interest rates for the first time since December 2008 in June and further reduced the rates earlier this month.
China manufacturing forecast july 2012
China’s manufacturing teetered on the edge of contraction in July and South Korea’s exports and inflation declined, indicating that stimulus efforts have yet to bear fruit.
The Purchasing Managers’ Index in China unexpectedly fell to 50.1 in July, the weakest in eight months, from 50.2 in June, a government report showed today. Fifty marks the dividing line between expansion and contraction. South Korea’s exports slid by more than double the amount forecast by analysts and inflation moderated to a 12-year low.
The data increase odds China and South Korea will add to interest-rate cuts in the coming months as a record-high jobless rate in the euro area drags on global growth. Leaders of China’s ruling Communist Party pledged yesterday to keep adjusting policies to ensure stable growth while signs of a revival in the housing market may improve chances of reversing the nation’s slowdown.
“It’s almost certain that there will be more loosening,” said Daniel Martin, Singapore-based Asia economist at Capital Economics Ltd. “The whole region is going to see fairly disappointing growth this year.” He sees at one more interest- rate cut in China and at least one more this year by South Korea.
The reading today from the Beijing-based National Bureau of Statistics and China Federation of Logistics and Purchasing and compares with the 50.5 median estimate in a Bloomberg News survey.
Three of 24 economists surveyed had forecast a decline in the gauge from June. The report showed indexes of output and new export orders were at the lowest levels since November, while a new orders gauge showed a contraction for a third month and employment declined. A reading on imports was the weakest since February 2009.
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Friday, August 3, 2012
July U.S. Jobs Report august 3 2012
July U.S. Jobs Report august 3 2012 : U.S. employers in July hired the most workers in five months, but an increase in the jobless rate to 8.3 percent kept prospects of further monetary stimulus from the Federal Reserve on the table.
Nonfarm payrolls rose 163,000 last month, the Labor Department said on Friday, breaking three straight months of job gains below 100,000 and offering hope for the ailing economy.
"As long as the unemployment rate is high, the central bank will have to consider further stimulus," said Sung Won Sohn, an economics professor at California State University Channel Islands in Camarillo, California.
While the report gave talking points to Republicans and Democrats for the upcoming general election, investors on Wall Street shrugged off the rise in the jobless rate and snapped up stocks.
The unemployment rate rose from 8.2 percent in June, even as more people gave up the search for work and a survey of households showed a drop in employment.
The Federal Reserve on Wednesday sent a stronger signal that a new round of major support could be on the way if the recovery did not pick up. The labor market has slowed after hefty gains in the winter, spelling trouble for President Barack Obama.
A recent Reuters/Ipsos poll showed 36 percent of registered voters believe Republican presidential candidate Mitt Romney has a better plan for the economy, compared to 31 percent who had faith in Obama's policies.
Both Obama and Romney used the jobs report to plead their case to America's middle-class. Obama said the Republican tax plan would hurt the middle-class.
"The last thing that we should be doing is asking middle class families who are still struggling to recover from this recession to pay more in taxes," Obama said at the White House.
Romney said the rise in the jobless rate was "a hammer blow to struggling middle-class families."
The step-up in hiring beat economists' expectations for a 100,000 gain. It suggested the slump in job growth in the second quarter was largely payback for an unusually warm winter that had brought forward hiring into the early months of the year.
"When we look at the July numbers it looks like the payback is largely behind us. It's likely that August and September will look more like July than the second quarter," said Ray Stone, an economist at Stone & McCarthy Research Associates in Princeton, New Jersey.
So far this year, job growth has averaged 151,000 per month, almost the same as the monthly average last year. This is roughly the amount needed just to keep the unemployment rate steady.
ODDS FAVOR MORE EASING
While the payrolls growth probably dampened the urgency for the Fed to act at the Sept. 12-13 meeting, further monetary stimulus remains in the cards given the threat to the economy from a potential tightening in fiscal policy next year and the ongoing debt troubles in Europe.
The household survey offered a downbeat assessment of the labor market, with the employment-to-population ratio - the broadest measure of labor utilization - falling 0.2 percentage point to 58.4 percent.
"We think the odds are still tilted in favor of more Fed accommodation at the September meeting, and that call obviously remains contingent on economic and financial developments over the next six weeks," said Michael Feroli, an economist at JPMorgan in New York.
The labor force participation rate, or the percentage of Americans who either have a job or are looking for one, fell to 63.7 percent last month from 63.8 percent.
Data last week showed the economy grew at an annual pace of 1.5 percent in the second quarter, far short of the 2.5 percent rate needed to keep the unemployment rate stable.
STOCKS RALLY
U.S. stocks rallied on the report, putting the Standard & Poors' 500 index on track to recover all of the losses posted during its recent four-day losing streak.
Prices for U.S. government debt fell and the dollar dropped more than 1 percent against a basket of currencies.
The private sector again accounted for all the job gains, adding 172,000 new positions. Government payrolls dropped by 9,000, as cash-strapped local governments laid off teachers.
Construction employment dipped 1,000, despite a rise in home building. Manufacturing payrolls increased 25,000, largely because of fewer layoffs in the auto sector as manufacturers kept production lines running during the month.
Within the vast services sector, employment gains were fairly widespread. From retail to professional and business services, employers added workers.
However, the momentum could slow. A second report showed the services sector grew modestly in July as new orders rose, but a measure of employment dropped to its lowest level in nearly a year.
Last month, temporary help services increased 14,100 after rising 21,100 in June. But hiring in the utility sector was restrained by a strike at a power firm in New York last month.
Average hourly earnings increased 2 cents last month, suggesting consumer spending will struggle regain steam after it slowed sharply in the second quarter. In the 12 months to July, earnings rose 1.7 percent.
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Nonfarm payrolls rose 163,000 last month, the Labor Department said on Friday, breaking three straight months of job gains below 100,000 and offering hope for the ailing economy.
"As long as the unemployment rate is high, the central bank will have to consider further stimulus," said Sung Won Sohn, an economics professor at California State University Channel Islands in Camarillo, California.
While the report gave talking points to Republicans and Democrats for the upcoming general election, investors on Wall Street shrugged off the rise in the jobless rate and snapped up stocks.
The unemployment rate rose from 8.2 percent in June, even as more people gave up the search for work and a survey of households showed a drop in employment.
The Federal Reserve on Wednesday sent a stronger signal that a new round of major support could be on the way if the recovery did not pick up. The labor market has slowed after hefty gains in the winter, spelling trouble for President Barack Obama.
A recent Reuters/Ipsos poll showed 36 percent of registered voters believe Republican presidential candidate Mitt Romney has a better plan for the economy, compared to 31 percent who had faith in Obama's policies.
Both Obama and Romney used the jobs report to plead their case to America's middle-class. Obama said the Republican tax plan would hurt the middle-class.
"The last thing that we should be doing is asking middle class families who are still struggling to recover from this recession to pay more in taxes," Obama said at the White House.
Romney said the rise in the jobless rate was "a hammer blow to struggling middle-class families."
The step-up in hiring beat economists' expectations for a 100,000 gain. It suggested the slump in job growth in the second quarter was largely payback for an unusually warm winter that had brought forward hiring into the early months of the year.
"When we look at the July numbers it looks like the payback is largely behind us. It's likely that August and September will look more like July than the second quarter," said Ray Stone, an economist at Stone & McCarthy Research Associates in Princeton, New Jersey.
So far this year, job growth has averaged 151,000 per month, almost the same as the monthly average last year. This is roughly the amount needed just to keep the unemployment rate steady.
ODDS FAVOR MORE EASING
While the payrolls growth probably dampened the urgency for the Fed to act at the Sept. 12-13 meeting, further monetary stimulus remains in the cards given the threat to the economy from a potential tightening in fiscal policy next year and the ongoing debt troubles in Europe.
The household survey offered a downbeat assessment of the labor market, with the employment-to-population ratio - the broadest measure of labor utilization - falling 0.2 percentage point to 58.4 percent.
"We think the odds are still tilted in favor of more Fed accommodation at the September meeting, and that call obviously remains contingent on economic and financial developments over the next six weeks," said Michael Feroli, an economist at JPMorgan in New York.
The labor force participation rate, or the percentage of Americans who either have a job or are looking for one, fell to 63.7 percent last month from 63.8 percent.
Data last week showed the economy grew at an annual pace of 1.5 percent in the second quarter, far short of the 2.5 percent rate needed to keep the unemployment rate stable.
STOCKS RALLY
U.S. stocks rallied on the report, putting the Standard & Poors' 500 index on track to recover all of the losses posted during its recent four-day losing streak.
Prices for U.S. government debt fell and the dollar dropped more than 1 percent against a basket of currencies.
The private sector again accounted for all the job gains, adding 172,000 new positions. Government payrolls dropped by 9,000, as cash-strapped local governments laid off teachers.
Construction employment dipped 1,000, despite a rise in home building. Manufacturing payrolls increased 25,000, largely because of fewer layoffs in the auto sector as manufacturers kept production lines running during the month.
Within the vast services sector, employment gains were fairly widespread. From retail to professional and business services, employers added workers.
However, the momentum could slow. A second report showed the services sector grew modestly in July as new orders rose, but a measure of employment dropped to its lowest level in nearly a year.
Last month, temporary help services increased 14,100 after rising 21,100 in June. But hiring in the utility sector was restrained by a strike at a power firm in New York last month.
Average hourly earnings increased 2 cents last month, suggesting consumer spending will struggle regain steam after it slowed sharply in the second quarter. In the 12 months to July, earnings rose 1.7 percent.
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Tuesday, July 31, 2012
U.S. Consumer Confidence Index july 2012
U.S. Consumer Confidence Index july 2012 : Confidence among U.S. consumers unexpectedly rose for the first time in five months as Americans became more upbeat about job prospects later this year.
The Conference Board’s index increased to 65.9 this month from 62.7 in June, figures from the New York-based private research group showed today. Economists projected a reading of 61.5, according to the median estimate in a Bloomberg News survey. The report showed a gain in the share of consumers anticipating better labor and economic conditions in six months.
A pickup in the housing market and decreases in fuel prices are helping sustain consumer sentiment. At the same time, faster job gains are needed to spur consumer spending, which grew in the second quarter at the slowest pace in a year.
“Consumers are definitely getting some benefit from lower gasoline prices and that is freeing up some income,” Gus Faucher, a senior economist at PNC Financial Services Group Inc. in Philadelphia, said before the report. “Confidence is OK, it’s not great. We need better job growth.”
Stocks held losses after the report. The Standard & Poor’s 500 Index fell 0.1 percent to 1,383.84 at 10:20 a.m. in New York.
Estimates for the Conference Board gauge ranged from 59 to 67 in the Bloomberg News survey of 71 economists. The measure averaged 53.7 during the 18-month recession that ended in June 2009.
Personal Spending
The Commerce Department said today consumer purchases in June cooled, indicating a weak handoff to the second half of the year. Personal spending was unchanged after decreasing 0.1 percent. Incomes climbed 0.5 percent following a 0.3 percent gain.
Another report showed housing prices are stabilizing. The S&P/Case-Shiller index of property values decreased 0.7 percent in May from a year earlier, data from the group showed in New York.
Today’s confidence figures contrast other data on consumer sentiment. The Bloomberg Consumer Comfort Index fell in the week ended July 22 to minus 38.5, the lowest level in two months. The Thomson Reuters/University of Michigan final July index of consumer sentiment was the weakest this year.
“Despite this month’s improvement in confidence, the overall index remains at historically low levels,” Lynn Franco, director of economic indicators at the Conference Board, said in a statement. “While consumers expressed greater optimism about short-term business and employment prospects, they have grown more pessimistic about their earnings.”
Present Conditions
The Conference Board group’s measure of present conditions decreased to 46.2 from 46.6 in June. The measure of expectations for the next six months increased to 79.1 from 73.4 in June.
The percent of respondents expecting more jobs to become available in the next six months rose to 17.6 from 14.8 the previous month. The proportion of consumers who expect their incomes to rise over the next six months decreased to 14.2 percent from 15.3 percent.
The share of consumers who said jobs are currently plentiful fell to 7.8 percent from 8.3 percent. Those who said jobs weren’t plentiful rose to 51.4 percent from 50.5 percent.
Faster employment growth would help lay the foundation for a pickup in consumer spending, which accounts for about 70 percent of the economy.
Labor Market
Payroll gains slowed to an average 75,000 in the April to June period, down from 226,000 in the first quarter and the weakest in almost two years, Labor Department figures show. The jobless rate has exceeded 8 percent since February 2009, the longest stretch in monthly records going back to 1948.
Gross domestic product, the value of all goods and services produced, rose at a 1.5 percent annual rate after a revised 2 percent gain in the prior quarter, Commerce Department data showed last week in Washington. Household purchases grew at the slowest pace in a year.
Recent data signal consumers are reluctant to step up purchases. Retail sales fell in June for a third consecutive month, the longest period of declines since 2008. Same-store sales rose less than analysts’ estimates at retailers including Target Corp. and Macy’s Inc.
Fed Chairman Ben S. Bernanke and his colleagues on the Federal Open Market Committee, who have pledged to keep the benchmark interest rate low until late 2014, meet today and tomorrow to decide whether more is needed to stimulate the world’s largest economy.
Central bankers will probably forego announcing a third round of large-scale asset purchases this week, and is more likely to wait until September to unveil plans to buy $600 billion in housing and government debt, according to median estimates of economists in a Bloomberg News survey. (source http://www.businessweek.com )
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The Conference Board’s index increased to 65.9 this month from 62.7 in June, figures from the New York-based private research group showed today. Economists projected a reading of 61.5, according to the median estimate in a Bloomberg News survey. The report showed a gain in the share of consumers anticipating better labor and economic conditions in six months.
A pickup in the housing market and decreases in fuel prices are helping sustain consumer sentiment. At the same time, faster job gains are needed to spur consumer spending, which grew in the second quarter at the slowest pace in a year.
“Consumers are definitely getting some benefit from lower gasoline prices and that is freeing up some income,” Gus Faucher, a senior economist at PNC Financial Services Group Inc. in Philadelphia, said before the report. “Confidence is OK, it’s not great. We need better job growth.”
Stocks held losses after the report. The Standard & Poor’s 500 Index fell 0.1 percent to 1,383.84 at 10:20 a.m. in New York.
Estimates for the Conference Board gauge ranged from 59 to 67 in the Bloomberg News survey of 71 economists. The measure averaged 53.7 during the 18-month recession that ended in June 2009.
Personal Spending
The Commerce Department said today consumer purchases in June cooled, indicating a weak handoff to the second half of the year. Personal spending was unchanged after decreasing 0.1 percent. Incomes climbed 0.5 percent following a 0.3 percent gain.
Another report showed housing prices are stabilizing. The S&P/Case-Shiller index of property values decreased 0.7 percent in May from a year earlier, data from the group showed in New York.
Today’s confidence figures contrast other data on consumer sentiment. The Bloomberg Consumer Comfort Index fell in the week ended July 22 to minus 38.5, the lowest level in two months. The Thomson Reuters/University of Michigan final July index of consumer sentiment was the weakest this year.
“Despite this month’s improvement in confidence, the overall index remains at historically low levels,” Lynn Franco, director of economic indicators at the Conference Board, said in a statement. “While consumers expressed greater optimism about short-term business and employment prospects, they have grown more pessimistic about their earnings.”
Present Conditions
The Conference Board group’s measure of present conditions decreased to 46.2 from 46.6 in June. The measure of expectations for the next six months increased to 79.1 from 73.4 in June.
The percent of respondents expecting more jobs to become available in the next six months rose to 17.6 from 14.8 the previous month. The proportion of consumers who expect their incomes to rise over the next six months decreased to 14.2 percent from 15.3 percent.
The share of consumers who said jobs are currently plentiful fell to 7.8 percent from 8.3 percent. Those who said jobs weren’t plentiful rose to 51.4 percent from 50.5 percent.
Faster employment growth would help lay the foundation for a pickup in consumer spending, which accounts for about 70 percent of the economy.
Labor Market
Payroll gains slowed to an average 75,000 in the April to June period, down from 226,000 in the first quarter and the weakest in almost two years, Labor Department figures show. The jobless rate has exceeded 8 percent since February 2009, the longest stretch in monthly records going back to 1948.
Gross domestic product, the value of all goods and services produced, rose at a 1.5 percent annual rate after a revised 2 percent gain in the prior quarter, Commerce Department data showed last week in Washington. Household purchases grew at the slowest pace in a year.
Recent data signal consumers are reluctant to step up purchases. Retail sales fell in June for a third consecutive month, the longest period of declines since 2008. Same-store sales rose less than analysts’ estimates at retailers including Target Corp. and Macy’s Inc.
Fed Chairman Ben S. Bernanke and his colleagues on the Federal Open Market Committee, who have pledged to keep the benchmark interest rate low until late 2014, meet today and tomorrow to decide whether more is needed to stimulate the world’s largest economy.
Central bankers will probably forego announcing a third round of large-scale asset purchases this week, and is more likely to wait until September to unveil plans to buy $600 billion in housing and government debt, according to median estimates of economists in a Bloomberg News survey. (source http://www.businessweek.com )
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Friday, July 27, 2012
IMF estimates Spanish GDP growth 2012-2013
IMF estimates Spanish GDP will shrink 2012 : Spain faces a lost decade of growth, with the current double-dip recession lasting for at least another 18 months, the International Monetary Fund warns. In its latest report on the Spanish economy, just released, the IMF warned that the scale of the Spanish downturn poses a threat to the rest of Europe.
The Fund said the outlook for Spain was “very difficult” and that the fresh austerity measures announced by the government of prime minister Mariano Rajoy would have “a significant impact on growth”.
The IMF now estimates that Spanish GDP will shrink by -1.7% in 2012, and a further -1.2% in 2013. It then sees a 0.9% expansion in 2014.
It also warns that Spain is threatened by several downside risks – including the danger that Rajoy's policies fail to stop capital leaving the country; or the impact of "further stress" elsewhere in the euro area.
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The Fund said the outlook for Spain was “very difficult” and that the fresh austerity measures announced by the government of prime minister Mariano Rajoy would have “a significant impact on growth”.
The IMF now estimates that Spanish GDP will shrink by -1.7% in 2012, and a further -1.2% in 2013. It then sees a 0.9% expansion in 2014.
It also warns that Spain is threatened by several downside risks – including the danger that Rajoy's policies fail to stop capital leaving the country; or the impact of "further stress" elsewhere in the euro area.
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Wednesday, July 25, 2012
us consumer price index forecast 2013
us consumer price index forecast 2013, Food Inflation prediction 2013 : U.S. consumers may pay 3 percent to 4 percent more for food next year, as the effects of the country’s worst drought since the 1950s work their way onto supermarket shelves, the Department of Agriculture said in its first forecast for 2013.
Beef may rise as much as 5 percent in response to tight supplies of corn, which is used to feed cattle, the USDA said today in a report on its website. The price of the grain, the country’s biggest crop, has surged more than 50 percent since June 15. Food prices will rise 2.5 percent to 3.5 percent this year, the agency said, leaving its 2012 estimate unchanged.
Corn and soybean futures both reached record highs this week on the Chicago Board of Trade, and wheat touched its highest since 2008 as the dry conditions worsened in the Midwest and Great Plains. The drought that prompted the USDA to declare natural disasters in almost 1,300 counties in 29 states -- about a third of the country’s total -- may lead to the smallest corn harvest since 2006, Doan Advisory Services Co. said July 23.
“The transmission of commodity price changes into retail prices typically takes several months to occur, and most of the impact of the drought is expected to be realized in 2013,” said Richard Volpe, the USDA’s food economist, wrote in a note accompanying the forecast.
Purchasing Power
Food costs have risen 1 percent so far this year, the government said earlier this month.
Higher commodity prices may affect everything from meat purchased by McDonald’s Corp. (MCD) (MCD) to the grain bought by General Mills Inc. (GIS) (GIS) to the sweeteners used by Coca-Cola Co. (KO) (KO) More- expensive food has already eroded purchasing power at Save-A-Lot stores operated by SuperValu Inc. (SVU) (SVU), the third-biggest U.S. grocery chain, Craig Herkert, the chief executive officer of the Eden Prairie, Minnesota-based company, said in a conference call with analysts July 11.
Still, higher crop prices may not immediately be reflected on store shelves. McDonald’s, the world’s largest restaurant chain, has lowered its estimated 2012 increase in grocery costs to 3.5 percent to 4.5 percent from 4.5 percent to 5.5 percent, Peter J. Bensen, the chief financial officer of Oak Brook, Illinois-based McDonald’s, said on a conference call with analysts July 23. The company bought grain and other commodities before the drought-induced rally, locking in lower prices.
‘Fairly Tame’
“Food-price inflation is actually going to be fairly tame for the rest of the year,” said Bob Young, chief economist for the American Farm Bureau Federation. Higher fruit and vegetable costs caused by frosts early in the year have already been built into pricing, and increased costs for corn and soybeans, used in livestock rations, may not affect the price of many meat products quickly because of the life cycles of the animals being fed, he said.
The earliest price increases may be seen in poultry meat and eggs, which come from birds with shorter lives that are raised almost entirely on corn, said Bill Lapp, a former chief economist for ConAgra Foods Inc. (CAG) (CAG) and the president of Advanced Economic Solutions in Omaha, Nebraska. The USDA today said egg prices will rise as much as 4 percent in 2012, up from its projection for this year of 1 percent to 2 percent.
Meat Forecast
Dairy, pork and beef, all produced by animals that are on feed longer, will follow, Lapp said before today’s report, raising food inflation next year to 4.5 percent, about 2 percentage points more than it would otherwise have been. The effect will carry over into 2014, adding half a percentage point to the previously expected jump in prices, he said.
Beef may even see a short-term decline, Lapp said, as meatpackers slaughter animals earlier to avoid the higher corn costs, temporarily increasing supply. The USDA today lowered its forecast for increases in beef prices for 2012 half a percentage point to 3.5 percent to 4.5 percent.
Still, the reduced beef supply may increase pressure on prices in the longer term, since the U.S. cattle herd, which on July 1 was at its lowest for the date since 1973, may shrink further, he said.
The drought in the U.S., the biggest corn exporter, may push up food prices worldwide, possibly discouraging central banks from easing monetary policy, Merrill Lynch Health Management said yesterday in a report. In the U.S., because nutrition accounts for only about a seventh of the Consumer Price Index, the impact of rising costs on overall inflation may be small, according to Paul Dales, senior U.S. economist for London-based Capital Economics Ltd.
Lag Time
“It can take up to nine months for rises in agricultural commodity prices to filter through into higher food prices in the stores,” Dales wrote yesterday in a note to investors. Dales also said food inflation may rise to about 4.5 percent.
“The upshot is that the recent drought will not be a disaster for the American economy as a whole,” he wrote. “Coming at a time when the economic recovery is faltering, even a small loss of output in a small sector is a further hindrance.”
Retail-food costs rose 3.7 percent in 2011, according to the USDA. Consumer prices have increased 1 percent so far this year, the government said.
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Beef may rise as much as 5 percent in response to tight supplies of corn, which is used to feed cattle, the USDA said today in a report on its website. The price of the grain, the country’s biggest crop, has surged more than 50 percent since June 15. Food prices will rise 2.5 percent to 3.5 percent this year, the agency said, leaving its 2012 estimate unchanged.
Corn and soybean futures both reached record highs this week on the Chicago Board of Trade, and wheat touched its highest since 2008 as the dry conditions worsened in the Midwest and Great Plains. The drought that prompted the USDA to declare natural disasters in almost 1,300 counties in 29 states -- about a third of the country’s total -- may lead to the smallest corn harvest since 2006, Doan Advisory Services Co. said July 23.
“The transmission of commodity price changes into retail prices typically takes several months to occur, and most of the impact of the drought is expected to be realized in 2013,” said Richard Volpe, the USDA’s food economist, wrote in a note accompanying the forecast.
Purchasing Power
Food costs have risen 1 percent so far this year, the government said earlier this month.
Higher commodity prices may affect everything from meat purchased by McDonald’s Corp. (MCD) (MCD) to the grain bought by General Mills Inc. (GIS) (GIS) to the sweeteners used by Coca-Cola Co. (KO) (KO) More- expensive food has already eroded purchasing power at Save-A-Lot stores operated by SuperValu Inc. (SVU) (SVU), the third-biggest U.S. grocery chain, Craig Herkert, the chief executive officer of the Eden Prairie, Minnesota-based company, said in a conference call with analysts July 11.
Still, higher crop prices may not immediately be reflected on store shelves. McDonald’s, the world’s largest restaurant chain, has lowered its estimated 2012 increase in grocery costs to 3.5 percent to 4.5 percent from 4.5 percent to 5.5 percent, Peter J. Bensen, the chief financial officer of Oak Brook, Illinois-based McDonald’s, said on a conference call with analysts July 23. The company bought grain and other commodities before the drought-induced rally, locking in lower prices.
‘Fairly Tame’
“Food-price inflation is actually going to be fairly tame for the rest of the year,” said Bob Young, chief economist for the American Farm Bureau Federation. Higher fruit and vegetable costs caused by frosts early in the year have already been built into pricing, and increased costs for corn and soybeans, used in livestock rations, may not affect the price of many meat products quickly because of the life cycles of the animals being fed, he said.
The earliest price increases may be seen in poultry meat and eggs, which come from birds with shorter lives that are raised almost entirely on corn, said Bill Lapp, a former chief economist for ConAgra Foods Inc. (CAG) (CAG) and the president of Advanced Economic Solutions in Omaha, Nebraska. The USDA today said egg prices will rise as much as 4 percent in 2012, up from its projection for this year of 1 percent to 2 percent.
Meat Forecast
Dairy, pork and beef, all produced by animals that are on feed longer, will follow, Lapp said before today’s report, raising food inflation next year to 4.5 percent, about 2 percentage points more than it would otherwise have been. The effect will carry over into 2014, adding half a percentage point to the previously expected jump in prices, he said.
Beef may even see a short-term decline, Lapp said, as meatpackers slaughter animals earlier to avoid the higher corn costs, temporarily increasing supply. The USDA today lowered its forecast for increases in beef prices for 2012 half a percentage point to 3.5 percent to 4.5 percent.
Still, the reduced beef supply may increase pressure on prices in the longer term, since the U.S. cattle herd, which on July 1 was at its lowest for the date since 1973, may shrink further, he said.
The drought in the U.S., the biggest corn exporter, may push up food prices worldwide, possibly discouraging central banks from easing monetary policy, Merrill Lynch Health Management said yesterday in a report. In the U.S., because nutrition accounts for only about a seventh of the Consumer Price Index, the impact of rising costs on overall inflation may be small, according to Paul Dales, senior U.S. economist for London-based Capital Economics Ltd.
Lag Time
“It can take up to nine months for rises in agricultural commodity prices to filter through into higher food prices in the stores,” Dales wrote yesterday in a note to investors. Dales also said food inflation may rise to about 4.5 percent.
“The upshot is that the recent drought will not be a disaster for the American economy as a whole,” he wrote. “Coming at a time when the economic recovery is faltering, even a small loss of output in a small sector is a further hindrance.”
Retail-food costs rose 3.7 percent in 2011, according to the USDA. Consumer prices have increased 1 percent so far this year, the government said.
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Tuesday, July 24, 2012
Chinese economic growth outlook Q2 2012
Chinese economic growth outlook Q2 2012 : In China, the news was more encouraging, suggesting a series of policy measures, including interest rate cuts, may be starting to revive an economy that had slowed sharply of late.
HSBC's Flash China manufacturing purchasing managers index, the first significant set of data in the third quarter, r ose to 49.5 in July from 48.2 in June, closer to the 50 level that divides expansion from contraction. The increase was driven by a jump in the output sub-index to 51.2 - the best showing since October 2011.
The PMI "adds to recent signs of stabilization of the Chinese economy, thus underpinning our view that the slowdown in activity will bottom out over the summer months," said Nikolaus Keis at UniCredit.
Chinese economic growth in the second quarter cooled to 7.6 percent from a year earlier, its slowest pace in more than three years, but still way ahead of the United States and the euro zone, which has likely fallen back into recession.
For Nomura's chief China economist, Zhang Zhiwei, the PMI provided further evidence that a slowdown in China's economy bottomed out in the second quarter of 2012. "This suggests the effect of policy easing is being transmitted to the economy and reinforces our view that growth has bottomed in Q2," Hong Kong-based Zhang said.
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HSBC's Flash China manufacturing purchasing managers index, the first significant set of data in the third quarter, r ose to 49.5 in July from 48.2 in June, closer to the 50 level that divides expansion from contraction. The increase was driven by a jump in the output sub-index to 51.2 - the best showing since October 2011.
The PMI "adds to recent signs of stabilization of the Chinese economy, thus underpinning our view that the slowdown in activity will bottom out over the summer months," said Nikolaus Keis at UniCredit.
Chinese economic growth in the second quarter cooled to 7.6 percent from a year earlier, its slowest pace in more than three years, but still way ahead of the United States and the euro zone, which has likely fallen back into recession.
For Nomura's chief China economist, Zhang Zhiwei, the PMI provided further evidence that a slowdown in China's economy bottomed out in the second quarter of 2012. "This suggests the effect of policy easing is being transmitted to the economy and reinforces our view that growth has bottomed in Q2," Hong Kong-based Zhang said.
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Monday, July 23, 2012
impact economic problems of Greece, Spain and Italy on stock markets
impact economic problems of Greece, Spain and Italy on stock markets : Markets continue to slide ahead of Wall Street opening for trading. US futures point to the Dow Jones Industrial Average falling 173 points, or 1.3%, to 12,603. The S&P 500 is expected to fall 16 points to 1,340.
The FTSE 100 extends its decline, down 126 points, or 2.2%, on the day at 5,525.
Russian steelmaker Evraz (EVRE.L) is the biggest faller, down 8.7% or 20.6p at 213p as a sell-off in resources stocks is compounded by Morgan Standley questioning its earnings targets.
Aviva (AV.L), the high-yielding insurer shedding businesses attempting to shore up its capital position, has fallen further, trading 18p, or 6%, lower at 276.
Outsourcer Serco (SRP.L) is the one stock in the FTSE 100 to gain ground, rising modestly to 566.5p.
Fear grips the markets as the economic problems of Greece, Spain and Italy appear to converge. In a sign of the panic Italy has reintroduced a termporary ban on the short selling of financial stocks. Spain's market regulator has banned all shorting of stocks for three months.
Spain’s chances of averting a bailout are fading after the country fell deeper into recession in the second quarter.
Bank of Spain figures show the Spanish economy shrank by 0.4% in April- June after a 0.3% contraction in the first quarter.
Spain’s economy minister Luis de Guindos insists: ‘Spain is a solvent country, there will be no bailout... I believe that Spain is a competitive country. We have a trade surplus with the eurozone, we have a very competitive tourism sector’.
But this stance looks increasingly forlorn with Spain’s borrowing costs surging after investors dumped the country’s government bonds in fear at the country’s growing exposure to its troubled regions. Mercia and Valencia have both said they will tap a government fund and there are reports that six more regions could follow suit.
The yields on Spanish 10-year bond jumped to nearly 7.5%, well beyond the 7% level at which other eurozone countries have required bailouts. The Spanish stock market tumbled 3.5% with the broader Euronext 100 index falling nearly 2%.
De Guindos plans to travel to Germany tomorrow to discuss the crisis with his counterpart Wolfgang Schaeuble.
Spain is locked into a downward spiral with the Bank of Spain’s deputy reiterating the need for more austerity that will further restrict economic growth. ‘We need to continue further along the same line. We need more cuts, more reforms which will restore market confidence and mechanisms which will strengthen the monetary union,’ said Fernando Restoy.
The situation is deteriorating as authorities fail to keep pace with events. The €100 billion bailout of Spain's banking sector was confirmed on Friday but with the country's indebted regions locked out of the bond markets there is no end in sight to its debt crisis.
Worryingly, there are reports that 10 cities in Italy may also be struggling financially. In an echo of what is happening in Spain, Reuters cites a report in La Stampa newspaper that says government sources believe the cities, including Naples and Palermo, 'are at risk' of default. Although such a default would not immediately increase the country's €2 trillion debt pile, it shows the growing pressure on government finances as the recession bites.
Government bonds in the UK and Germany rose amidst this uncertainty. The 10-year yield on German bunds fell to an all-time low of 1.14%, while in the UK 10-year gilts fell to 1.4%.
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The FTSE 100 extends its decline, down 126 points, or 2.2%, on the day at 5,525.
Russian steelmaker Evraz (EVRE.L) is the biggest faller, down 8.7% or 20.6p at 213p as a sell-off in resources stocks is compounded by Morgan Standley questioning its earnings targets.
Aviva (AV.L), the high-yielding insurer shedding businesses attempting to shore up its capital position, has fallen further, trading 18p, or 6%, lower at 276.
Outsourcer Serco (SRP.L) is the one stock in the FTSE 100 to gain ground, rising modestly to 566.5p.
Fear grips the markets as the economic problems of Greece, Spain and Italy appear to converge. In a sign of the panic Italy has reintroduced a termporary ban on the short selling of financial stocks. Spain's market regulator has banned all shorting of stocks for three months.
Spain’s chances of averting a bailout are fading after the country fell deeper into recession in the second quarter.
Bank of Spain figures show the Spanish economy shrank by 0.4% in April- June after a 0.3% contraction in the first quarter.
Spain’s economy minister Luis de Guindos insists: ‘Spain is a solvent country, there will be no bailout... I believe that Spain is a competitive country. We have a trade surplus with the eurozone, we have a very competitive tourism sector’.
But this stance looks increasingly forlorn with Spain’s borrowing costs surging after investors dumped the country’s government bonds in fear at the country’s growing exposure to its troubled regions. Mercia and Valencia have both said they will tap a government fund and there are reports that six more regions could follow suit.
The yields on Spanish 10-year bond jumped to nearly 7.5%, well beyond the 7% level at which other eurozone countries have required bailouts. The Spanish stock market tumbled 3.5% with the broader Euronext 100 index falling nearly 2%.
De Guindos plans to travel to Germany tomorrow to discuss the crisis with his counterpart Wolfgang Schaeuble.
Spain is locked into a downward spiral with the Bank of Spain’s deputy reiterating the need for more austerity that will further restrict economic growth. ‘We need to continue further along the same line. We need more cuts, more reforms which will restore market confidence and mechanisms which will strengthen the monetary union,’ said Fernando Restoy.
The situation is deteriorating as authorities fail to keep pace with events. The €100 billion bailout of Spain's banking sector was confirmed on Friday but with the country's indebted regions locked out of the bond markets there is no end in sight to its debt crisis.
Worryingly, there are reports that 10 cities in Italy may also be struggling financially. In an echo of what is happening in Spain, Reuters cites a report in La Stampa newspaper that says government sources believe the cities, including Naples and Palermo, 'are at risk' of default. Although such a default would not immediately increase the country's €2 trillion debt pile, it shows the growing pressure on government finances as the recession bites.
Government bonds in the UK and Germany rose amidst this uncertainty. The 10-year yield on German bunds fell to an all-time low of 1.14%, while in the UK 10-year gilts fell to 1.4%.
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