Recent Updates
- US: Consumer Sentiment (Aug-prelim), Import/Export Prices (Jul)
- US: Consumer Sentiment Detail (Aug-prelim)
- US: Vehicle Miles Driven by State (Jun)
- Bulgaria: Agricultural PPI (Q2) Central Bank Survey (Jul)
- Blue Chip: Blue Chip Economic Indicators (Aug)
- more updates...
Economy in Brief
U.S. Housing Affordability Declines Further in June
The NAR Fixed Rate Mortgage Housing Affordability Index fell 3.6% in June...
EMU Output Makes Solid Gain in June
The European Monetary Union posted a 0.7% increase for industrial output in June...
U.S. Producer Prices Fall During July; Core Increase Weakens
The Producer Price Index for Final Demand fell 0.5% during July...
U.S. Unemployment Claims Continue on an Uptrend
Initial claims for unemployment insurance filed in the week ended August 6 rose 14,000 to 262,000...
RICS Survey Points to More U.K. Housing Sector Weakness
The survey of housing market conditions in the U.K. continues to show strength in prices versus weakness...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Carol Stone EA-13 Growth 0.6% in Q1; Inventories and Fixed Investment Drive Gain June 1, 2007
GDP in Europe -- the EA-13 -- expanded by 0.6% in Q1 at a quarterly rate in chained prices, the same as estimated by Eurostat in its "flash" estimate published on May 15 and described here by Louise Curley. This compounds to 2.4% at an annual rate, nearly four times the growth in the US for Q1. On a year-over-year basis, EA-13 growth was 2.97%, down modestly from Q4's 3.30%.
Today's European report is the first release of expenditure and industry components for the period. The greatest demand increase was in fixed capital formation, which grew 2.5% (quarterly rate) from Q4. A swing in inventories also added considerably to Q1 growth. The available nominal data show the change in inventories was -1.7 billion in Q4, but +14.1 billion in Q1. Thus, in chained prices, gross capital formation had decreased in Q4 by 0.6%, but surged by a substantial 4.8% in Q1. For comparison, without inventories, gross fixed capital formation rose 1.5% in Q4 and, as noted, 2.5% in Q1. Private consumption, however, decreased 0.1% in Q1, following a 0.4% increase in Q4. The net export balance decreased as imports rose 1.6% while exports expanded only 0.3%.
Among industries, gross value added in the industrial sector had the most notable acceleration, from 0.6% growth in Q4 to 1.1% in Q1. Construction picked up from 1.5% growth in Q4 to 1.9%. Agriculture contracted by 1.7% following a gain of 2.3% and there were modest pick-ups in the trade and finance sectors.
So the European economy remains generally strong, with the year-to-year growth averaging 2.8% over the past five quarters, the best sustained performance since the tech-bust in 2000/2001. For the broader European Union, EU27, the year-on-year gain was 3.2%, putting the last five quarters right at 3.0%. For Q1 alone, the EU27 expanded by 0.6%, the same as the EA-13. All of these data are in Haver's EUROSTAT database.
EA-13 (Chained 2000 Euros, SA) | Q1 2007* | Q4 2006* | Q3 2006* | Q1 2006** | 2006 | 2005 | 2004 |
---|---|---|---|---|---|---|---|
Real GDP (Bil.EUR, % Chg) | 1889.8 | 1878.5 | 1862.4 | 1834.2 | 7422.5 | 7224.6 | 7118.2 |
0.6 | 0.9 | 0.6 | 3.0 | 2.7 | 1.5 | 2.0 | |
Private Consumption | -0.1 | 0.4 | 0.7 | 1.4 | 1.7 | 1.5 | 1.5 |
Gross Capital Formation | 4.8 | -0.6 | 1.4 | 8.3 | 5.3 | 2.7 | 3.5 |
Gross Fixed Capital Formation | 2.5 | 1.5 | 1.0 | 7.8 | 4.9 | 2.6 | 2.3 |
GVA: Industry | 1.1 | 0.6 | 1.0 | 3.2 | 3.8 | 1.1 | 1.8 |
Construction | 1.9 | 1.5 | 1.2 | 8.3 | 4.4 | 1.5 | 0.8 |
Finance & Real Estate | 0.9 | 0.7 | 0.4 | 2.9 | 2.6 | 2.2 | 1.8 |