The New Year Begins with Good European Economic Data

January 2, 2017

Share prices climbed 1.7% in Italy, 1.0% in Germany, 0.7% in Spain, 0.4% in France and 0.2% in Greece.

The ten-year Italian sovereign debt yield.

The dollar advanced 0.6% against the euro, 0.5% relative to the yen and Swiss franc, 0.4% vis-a-vis the Australian dollar and 0.3% versus the Mexican peso and sterling.

Most markets around the world are shut in observance of New Year’s Day.

Euroland’s December manufacturing purchasing managers index confirmed the flash estimate of 54.9, which implies the fastest expansion rate of activity since April 2011 and suggests a genuinely robust 4% pace of growth in factory sector activity during the final quarter of 2016.

Factory sector activity in the euro zone improved in all reporting members. Input price inflation intensified, also diminishing chances for an augmentation of monetary stimulus.

  • The Dutch and Austrian readings of 57.3 and 56.3 were 68-month highs.
  • The French PMI score of 53.5 is a 67-month high.
  • Germany’s 55.6 PMI reading was the best since January 2013.
  • Spain’s PMI, 55.3, beat expectations and was at an 11-month high.
  • The Italian PMI of 53.2 was at a half-year peak.
  • Greece had a reading of 49.3, best since August.

In other European economies reporting purchasing manager surveys in manufacturing,

  • The Czech index climbed 1.6 points to a 9-month high of 53.8.
  • Poland’s score, 54.3, was 2.4 points better in December than November and at a 17-month high.
  • The Swedish PMI increased 2.8 points to 60.1.
  • Norway’s PMI of 51.4 rebounded 3.8 points to 51.4, reversing most of the prior month’s decline.
  • Hungary’s PMI fell 4.1 points to 52.2.

Government-compiled Chinese PMI’s were reported of 51.4 in manufacturing, which was a 3-month low, and 54.5┬áin non-manufacturing, a 2-month low.

Mexico’s manufacturing PMI fell 0.9 points to 50.2, signifying near stagnation in December after the shock there of Donald Trump’s election to be the next U.S. president.

Elsewhere in Latin America, Brazil’s PMI dropped a full point to 45.2, consistent with the greatest rate of contraction in manufacturing since June.

India’s manufacturing PMI dirpped 2.7 points to 49.6, a 2016 low.

Turkey’s factory PMI, 47.7, was at a 4-month low following November’s best reading in six months.

South Korea’s factory PMI improved 1.4 points to 49.4, a 5-month high.

Jobs in Germany grew 1.0% last year, a tad faster than the pace in 2015.

Copyright 2017, Larry Greenberg. All rights reserved. No secondary distribution without express permission.




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