Disappointing British and Chinese Data ahead of U.S. Jobs Report
January 10, 2014
British industrial production and factory output each stagnated in November, cutting the former’s 12-month rate of increase to 2.5% from 3.2%. Construction output dropped 4.0% on month, and same-store British retail sales posted an on-year 0.4% increase last month, the smallest such gain in eight months.
China’s trade surplus contracted 24% last month to $25.64 billion, the smallest surplus since September. On-year export growth of 4.3% was the least since September as well and well below the 8.3% pace of import expansion, which was the largest such gain since July.
Japanese international reserves fell $8.5 billion to $1.2668 trillion in December but was only 1.3 billion less than at end-2012.
Japan’s index of coincident economic indicators rose in November to 110.5, best since July 2008. The index of leading economic indicators printed at 110.8, up a full point from October’s reading. Japanese stock and bond transactions generated a JPY 615 billion net capital inflow last week versus a 303 billion yen outflow in the final full week of 2013.
Peru’s central bank as expected retained a 4.0% reference interest rate. That central bank had surprised analysts with a 25-basis point rate cut in November.
Ahead of the monthly U.S. Labor Department jobs report due at 13:30 GMT, the dollar shows overnight gains of 0.4% against the kiwi and sterling, 0.2% versus the yen, and 0.1% relative to the euro, Swissie, and loonie. The Aussie dollar is unchanged, and the yuan has strengthened 0.1%.
Share prices closed mixed in Asia but are up in Europe. Stocks fell by 1.6% in the Philippines, 0.8% in China, 0.4% in South Korea and 0.2% in Australia but rose 1.3% in Indonesia, 1.0% in New Zealand, 0.3% in Hong Kong and 0.2% in Japan, Taiwan and India. In Europe, the British Ftse is 1.0% higher, and stocks in Germany, Spain and France have risen by 0.9%. Italy’s market is 0.7% stronger. Alcoa starts the 4Q U.S. corporate earnings season later today.
The ten-year British gilt yield fell by five basis points after softer-than-expected statistics. The German bund has edged a basis point lower, while the Japanese JGB is steady.
WTI crude oil climbed 1.1% to $92.63 per barrel. Gold is 0.3% firmer at $12333.30 per ounce.
The Bank of France’s business sentiment index slid a point to a reading of 100 in December. French industrial output, however, surprised on the upside with a 1.3% month-on-month advance in November (but just 1.5% from November 2012).
In other European industrial production news, Spain reported a 0.2% uptick in November and a calendar-adjusted 2.7% 12-month rate of rise. Swedish output leaped 5.7% on month and was 3.5% greater than in November 2012. Dutch factory output fell 0.5% on month and was a mere 0.9% greater on year. Danish production dropped 2.4% after a 0.8% October increase.
The final estimate of euro area GDP growth in 3Q confirmed a positive pace of only 0.1% but bumped up the 12-month change by a tenth percentage point to a drop of 0.3%.
Norwegian consumer prices slid 0.1% on month and decelerated from a 12-month increase of 2.5% in November to 2.0% in December. Swiss consumer prices fell 0.2% in December, leaving the 12-month increase at 0.1%. The seasonally adjusted Swiss jobless rate stayed at 3.2% last month. Danish consumer prices rose just 0.8% between end-2012 and end-2013.
New Home sales in Australia jumped 7.5% in November, most in nearly four years.
Brazilian CPI inflation ended last year at 5.9%.
Street estimates for growth in U.S. non-farm payroll jobs hover just south of 200K, and the unemployment rate is seen staying at 7.0%. Canadian unemployment and employment data also get released today. Bullard of the Fed speaks later.
Copyright 2014, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
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