Data Highlights From July 10th

July 13, 2009

Canadian unemployment increased to 8.6% in June from 8.4% in May and 6.1% last September.  This was the highest rate since February 1998.  A 40.1K rise in part-time workers limited the overall drop of jobs to a smaller-than-forecast 7.4K.  Wages recorded a 12-month increase of 3.5%, similar to May’s 3.4% but below 4.3% in April.  May trade figures also highlighted a continuing recession, with exports dropping 6.9% and 33.0% from a year earlier.  The C$ 1.42 billion deficit was three times greater than expected.  Canadian house prices, down 0.1% in May and 3.1% from May 2008, are trending lower but much more moderately than U.S. house prices.

British producer output prices in June fell 0.2% and 1.2% from a year earlier.  The PPI-I index rose 1.5% but fell 11% from June 2008, most since April 1997.

A 3.2% increase in U.S. import prices in June reflected a 20.3% advance in oil.  But non-fuel import prices went up 0.2% and posted an on-year 4.5% decline, underscoring deflationary forces even in the face of a suspect dollar.  The goods and services trade gap of $25.96 billion was 57% smaller than a year earlier and 9.8% less than April’s deficit.  Imports in January-May were 28.3% less than in the first five months of 2008.  Trade with OPEC accounted for 39% of the U.S. trade deficit’s drop in January-May from a year earlier, whereas trade with China was responsible for less than 8% of the improvement.

The University of Michigan sentiment printed at 64.6 in early July, some six points less than analyst forecasts.  A lousy labor market, continuing deleveraging, and falling equity values are squeezing the ability of American households to spend there way out of recession.  The week ahead will feature many quarterly earnings reports in the United States.  This will be a critical week for stocks and the U.S. business cycle.

French industrial production jumped 2.6% in May after dropping 1.5% in April, but Italian industrial output was unchanged in the month.  A 3.7% increase in German industrial production had been reported earlier last week.

Consumer prices in June rose by 0.6%, 0.4%, and 0.1% in Norway, Spain, and Portugal.  Japanese domestic corporate goods prices slid 0.3% in June and by 6.6% from mid-2008.  German wholesale prices advanced 0.9% in June but still recorded an 8.8% on-year decline.

In the week to July 10, oil prices fell 10.1%, and gold lost 2.1% of its value.  The dollar pivoted 1.40 against the euro and closed 0.2% higher on balance.  The dollar fell 3.9% against the yen on balance in a week when G-8 leaders were conspicuously silent about currency developments.  The 10-year Treasury yields declined 10 basis points.

Copyright Larry Greenberg 2009.  All rights reserved.  No secondary distribution without express permission.


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