A Slew of Data Releases to Start the New Week
December 8, 2014
Revised Japanese national income account statistics confirmed a technical recession in the world’s third largest economy. Real GDP was revised to show a larger quarter-on-quarter decline in 3Q of 1.9% at an annualized rate. Nominal GDP slumped 3.5% on quarter. Real GDP had fallen by 6.7% at a seasonally adjusted annualized rate (saar) in the spring quarter. Between 2Q and 3Q, residential and non-residential investment fell by 24.4% saar and 1.5% saar, and the run-off of inventories depressed GDP by 2.5 percentage points (ppts). Personal consumption rose 1.5%, public-sector spending advanced 1.1%, and net exports augmented the quarterly growth rate by 0.3 ppts. Real GDP was 1.3% lower in 3Q14 than in 3Q13, and the GDP price deflator slid by 0.3%.
China posted a record $54.47 billion trade surplus last month, but the report was not all positive. Imports contracted 6.7% on year, their first year-over-year decline since August, and export growth of 4.7% was half as much as expected and the smallest 12-month advance since April. Partly in response to the trade figures, Chinese share prices shot up some 4% today to a 42-month high, but the yuan depreciated past 6.17 per dollar.
Other overnight dollar changes were increases of 0.3% relative to the yen, euro and Swiss franc, advances of 0.8% versus the kiwi and 0.4% relative to the Aussie dollar, no change vis-a-vis the loonie and a drop of 0.3% against sterling.
Aside from China, most stock markets in Europe and Asia have lost ground today. There were drops of 1.2% in India, 0.9% in Indonesia, and 0.8% in Singapore and just a tiny 0.1% uptick in Japan’s Nikkei. Share prices are so far down 0.8% in Britain and France, 0.7% in Italy, 0.6% in Germany, and 0.4% in Spain.
The 10-year Japanese JGB and German bund yields are unchanged. The 10-year British gilt yield is a basis point softer.
WTI oil fell 2.0% to $64.55 per barrel. Comex gold is 0.4% higher at $1,195.20 per ounce.
German industrial production only rose 0.2% in October, half as much as forecast, in spite of a 1.9% advance in construction. Excluding that gain, industrial output would have been unchanged on the month. Output was just 0.8% greater than a year before.
Japan’s JPY 833 billion current account surplus in October was considerably greater than had been anticipated because of better-than-forecast non-merchandise trade flows. The trade gap of JPY 767 billion was bigger than September’s deficit of JPY 715 billion, and even in seasonally adjusted terms, the deficit grew marginally from 806 billion yen in September to 817 billion yen in October.
Japan’s economy watchers index, a gauge of sentiment among retail sector workers, dropped 2.5 points to a two-year low of 41.5 in November, and the outlook component declined 2.6 points to 44.0 in November. There were 14.6% fewer bankruptcies in November than a year earlier.
Bank lending growth in Japan accelerated to a 5-1/2 year high of 2.7% in November from 2.3% on year in October.
The Sentix gauge of investor sentiment toward the euro area improved to a 4-month high of -2.5 in December from -11.9 in November and a 17-month low of minus 13.7 posted in October.
Ireland’s construction purchasing managers index had a reading above 60.0 for a fifth straight time in November, although such dipped to a two-month low of 63.5 from a 10-year peak of 64.9 in October.
The Bank of France projects 0.1% growth in French GDP this quarter and reported a one-point rise in business sentiment to +97 last month.
Swiss retail sales rose 0.5% on month and 0.3% on year in October. Swiss consumer prices were unchanged in November and 0.1% below a year earlier’s level.
Czech industrial production fell 0.5% on month in October, trimming the 12-month rise to 3.2% from 8.3%. Czech unemployment was reported unchanged at 7.1% in November, and the Czech trade surplus dropped 47.6% on month to CZK 10.2 billion in October. Turkish industrial output was 2.4% higher than a year earlier in October.
The South African current account deficit last quarter equaled 6.0% of GDP.
New Zealand’s manufacturing activity index rose 0.4% last quarter in inflation-adjusted terms.
No U.S. data get released today. Canada will be reporting housing starts and building permits. Lockhart of the Federal Reserve speaks publicly, and finance ministers of the euro area are meeting today and tomorrow in Brussels.
Copyright 2014, Larry Greenberg. All rights reserved. No secondary distribution without express permission.