Some Good News From Asia

September 9, 2013

Japanese real GDP growth in 2Q13 was revised up sharply from 2.6% annualized reported initially to 3.8%.  Growth was also revised higher to 4.1% in the first quarter from 3.8% and to 1.1% in the final quarter of 2012 from 1.0%.  GDP between the second quarters of 2012 and 2013 climbed 1.2%.  The GDP price deflator was 0.5% lower than a year earlier in 2Q.  Japanese bankruptcies were 15.3% fewer last month than in August 2012.

Not all reported Japanese data today were inspiring, however.

  • Consumer confidence slipped to an 8-month low of 43.0 in August from 43.6 in July, 44.3 in in June, and 45.7 in May.
  • The economy watchers index dipped 1.1 points to 51.2 in August, lowest since January.
  • Bank lending growth, 2.3%, did not accelerate further in August.
  • The seasonally adjusted current account surplus of JPY 334 billion in July was only about half as big as that of JPY 646 billion posted in June.  The seasonally adjusted trade deficit of JPY 922 billion was up from JPY 572 billion in June.  The unadjusted current account of JPY 577 billion and trade shortfall of JPY 943 billion were worse than forecast and than the results in July 2012.

Australia’s Conservative party coalition headed by Paul Abbott secured a comfortably solid parliamentary majority.  Unpopular mining and carbon taxes will be rescinded.  The top credit rating appears safe.  Australian home loans grew 2.4% in July, similar to June’s 2.6% increase.

Tokyo was awarded the 2020 summer Olympics, beating out Madrid’s bid.

China’s trade surplus widened to a 7-month high of $28.6 billion in August from $17.8 billion in July.  On-year export growth of 7.2% beat forecasts, while a 7.0% rise in imports was down from 10.9% in the year to July.  Chinese consumer prices rose 0.1% on month in both July and August, and the 12-month rate of increase slid to a 3-month low of 2.6%.  Producer prices were 1.6% lower than in August 2012.

The dollar has declined 0.9% against the Australian dollar, 0.3% versus sterling, 0.2% relative to th loonie and 0.1% against the euro, Swissie and kiwi.  The dollar has risen 0.4% against the yen but is unchanged yet again versus the yuan.

Share prices increased 3.5% in China, 2.9% in Indonesia, 2.5% in Japan, 1.5% in India, 1.3% in Singapore, 1.0% in South Korea, and 0.7% in Australia.  European equities are down 0.4% in Spain and 0.3% in France and Britain but up 0.4% in Italy and 0.1% in Germany.

The 10-year Japanese JGB yield slipped three basis points, while its British and German counterparts are two and one basis points higher.

Gold is unchanged at $1386.20 per ounce.  Oil is 0.5% lower at $110.0 per barrel.

New Zealand’s manufacturing activity index fell another 2.0% this quarter.  Australian job ads dropped 2.0% on month, their 6th decline in a row.

Ireland’s construction purchasing managers index improved another 2.2 points to a reading of 49.7 in August and was 7.8 points better than the score in April.

The Bank of France reported a two-point rise in French business sentiment to 97 in August from 95 in July and 94 in June.

Swiss retail sales volume dipped 0.1% in July and to a 0.8% 12-month increase from 2.3% in the year to June.  Switzerland’s jobless rate remained at a low 3.2% seasonally adjusted in August.

Greek industrial production was 8.1% smaller in July than a year earlier and fell by 0.2% from June.  Greek consumer prices fell 1.3% between August 2012 and August 2013.  Dutch industrial production fell 0.4% on year in July.  Turkish industrial output rose 0.9% on month and 4.6% on year in July, beating forecasts.

Finland, Cyprus and Romania posted July trade deficits of EUR 280 million, EUR 315 million and EUR 570 million, respectively.  Denmark’s current account surplus that month amounted to DKK 13 billion.

U.S. consumer credit data get released today, as do Mexican consumer and producer prices.  The Bank of Mexico surprised analysts late Friday with a 25-basis point cut it its key interest rate to 3.75%.  a 50-bp reduction last March had been the first cut since July 2009.  Mexico has experienced an abrupt slowdown of economic activity.  GDP actually contracted unexpectedly in the second quarter.

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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