Myriad First-Quarter GDP Results

May 15, 2014

The euro touched an 11-week low of $1.3650 overnight and is trading 0.4% lower on balance.  The U.S. currency has also climbed 0.6% against the Swiss franc and 0.1% relative to the yen, Aussie dollar and sterling.  The loonie is 0.1% firmer, while the kiwi and yuan were unchanged on balance overnight.

Share prices slumped 1.3% in China, 0.8% in Japan and 0.4% in New Zealand but advanced by 1.4% in Indonesia, 0.7% in Hong Kong and 0.4% in Singapore and India.  In Europe, stocks are down 1.3% in Italy and 0.4% in Spain but up 0.6% in Switzerland and 0.1% in London and Frankfurt.

The ten-year German bund yield is a basis point higher, and its Japanese counterpart is a basis point lower.  The 10-year British gilt is steady.

West Texas Intermediate oil fell 0.3% to $102.04 per barrel.  Gold is steady at $1,305.40 per ounce.

Japanese GDP soared 5.9% at an annualized rate last quarter, as broad pre-tax growth in all components of private domestic demand was mitigated by drags from net exports and inventories.  Analysts were anticipating GDP growth of about 4% instead.  The GDP price deflator slid 0.4% annualized and was unchanged between 1Q13 and 1Q14.  Investors now expect Japan’s economy to languish for a quarter or two.

German GDP, up 0.8% on quarter and 2.3% on year, also beat street forecasts, but other Ezone members expanded less than predicted.

Growth in the euro area as a whole went up just 0.2%, half as much as expected, and on-year growth stayed under the 1.0% threshold at 0.9%.

French and Italian GDP stagnated in 1Q.  French GDP recorded a four-quarter advances of just 0.8%, while Italian GDP contracted 0.5% in the past year.

Spanish GDP rose 0.4% on quarter and 0.6% on year.  Portuguese GDP, down 0.7% on quarter, fell for the first time in a year and was only 1.2% greater than a year earlier.

Greece and Cypriot GDP posted on-year contractions of 1.1% and 4.1%.

Dutch GDP slumped by 1.4% on quarter and fell 0.5% on year.  In Belgium, GDP climbed 0.4% between 4Q13 and 1Q14 and by 1.2% on year.

Austrian GDP firmed 0.3% last quarter and was 1.0% larger than a year before.  Finnish GDP fell 0.4% on quarter and 0.8% on year.

Eurostat also released 1Q GDP statistics for several east European economies.

  • Czech GDP was flat on quarter but 2.0% higher on year.
  • Polish GDP growth accelerated to a 1.1% quarter-on-quarter rate and 3.2% on year.
  • GDP in Romania nearly stalled after solid prior gains.  GDP ticked 0.1% higher on quarter and rose 3.8% on year.
  • Hungarian GDP advanced by 1.1% for the second time in the past three quarters and was 3.2% above its year-earlier level.

Consumer prices in the euro area rose 0.2% on month and 0.7% on year in April.  Core consumer prices went up 0.3% on month and 1.0% on year, same as in the year to April 2013.  Service sector price inflation accelerated to 1.6% from 1.1% the month before.  Energy price inflation was at negative 1.2%, while prices for non-energy industrial goods were a mere 0.1% higher than in April 2013.

Japan’s tertiary index of service sector activity jumped 2.4% in March after a 0.9% drop in February and was 3.0% above its year-earlier level.  The tertiary index advanced 1.7% between 4Q13 and 1Q14.  Japanese stock and bond transactions last week generated a small 82 billion yen net capital outflow, which was only about a tenth as much as the prior week’s outflow.

Japanese consumer confidence deteriorated 0.5 points to 37.0 in April, weakest since mid-2011 and down from 45.4 in September 2013.

Bank of Japan Governor Kuroda noted that consumer prices are reflecting the consumption tax nearly in full as anticipated.

Motor vehicle sales in Australia were unchanged in April and posted a 12-month 1.9% rate of decline.

New Zealand’s business purchasing managers index continued the recent saw-toothed pattern, printing at 55.2 in April after readings of 58.0 in March, 52.8 in February, and 57.8 in January.

Wholesale prices in India recorded a 5.2% on-year advance in April, a half-percentage point less than in March.

Wholesale turnover in South Africa went up 6.0% in the year to March, down from a 7.2% 12-month advance in February.

Britain’s index of leading economic indicators went up 0.3% in March, while the index of coincident economic indicators edged just 0.1% higher.

The Swiss PPI/import price index slipped 0.3% in April and posted a 1.2% 12-month rate of decline, nearly twice the 0.7% drop in the year to March.

Consumer prices, industrial production and weekly jobless insurance claims head a highly rich U.S. data calendar for today, which also includes the Empire State and Philly Fed manufacturing surveys, the National Association of Home Builders’ housing market index, and Treasury-compiled capital flow numbers.  Fed Chair Janet Yellen speaks publicly today, and Canada publishes its monthly survey of manufacturing shipments, orders and inventories.

Copyright 2014, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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