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Economy in Brief
Delay in Release
of Data for Construction, MSIO, Intl Trade, Wholesale Trade, Treasury Statement, Retail Sales, Business Sales & Inventories, and Housing Starts Due to Lapse in Federal Government Funding.
U.S. Energy Prices Generally Move Higher
Retail gasoline prices were unchanged at $2.25 per gallon last week (-12.3% y/y)...
Japan Logs Another Trade Deficit
Japan logged a deficit on its trade account of 184 billion yen in Decmber...
U.S. Existing Home Sales Drop to Three-Year Low
The National Association of Realtors reported that sales of existing homes fell a greater-than-expected 6.4% in December...
Philadelphia Fed Nonmanufacturing Business Activity Slumps Again in January
The Philadelphia Fed reported that its Nonmanufacturing Business Index of current conditions at the company level slumped further to -0.2 in January...
by Robert Brusca September 5, 2007
Euro area sales trends point lower. Food as well as nonfood trends are on the decline. These trends are weighted significantly toward the trends for Germany where the recent deterioration is severe. The UK (an EU not EMU member) and France on the other hand still have relatively strong trends in force.
Detailed data lag by one month but they show weakness in household items, books and other spending. Pharmacy and textile spending has held up.
We can calculate the growth in the new quarter which is one month old by assessing the July growth rate of sales over the Q2 average and annualizing it appropriately. In Q3 total retail sales volumes in the Euro area are growing at a 1.2% pace; for nonfood items the pace is 2.2%.
We are past the point of being able to blame Germany’s VAT tax for the weakness. Year/year measures will still be impacted by that effect but three-month trends are free from it and they are weak. Germany has not been able to engage its consumer in the recovery. So far that has not been a problem since having an industry-led recovery is normal for Germany. But now, just when the consumer is expected to show up, the financial turmoil could keep the wary Germany consumer away. Italy already is weakened. France is ripe for a slowdown and, after some real post election euphoria, Europe faces question marks over the future of consumer spending.
| Jul-07 | Jun-07 | May-07 | 3-Mo | 6-Mo | 12-Mo | |
| Zone-13 Total | 0.1% | 0.6% | -0.8% | -0.5% | 1.6% | 0.7% |
| Food | 0.2% | -0.1% | -0.8% | -2.7% | 0.2% | -1.2% |
| Non-food | -0.1% | 1.0% | -0.8% | 0.8% | 2.7% | 2.1% |
| Textiles | #N/A | 2.8% | -3.5% | 2.8% | 2.6% | 4.0% |
| Household Goods | #N/A | 1.4% | -0.4% | 0.1% | -2.2% | 3.5% |
| Books news | #N/A | 1.3% | -0.9% | 0.8% | 1.5% | 2.7% |
| Pharmaceuticals | #N/A | 0.1% | 0.5% | 2.9% | 2.3% | 3.0% |
| Other Non-special Goods | #N/A | 1.2% | -0.8% | -1.7% | -1.2% | 0.1% |
| Mail Order | #N/A | -0.2% | 1.3% | 7.3% | -5.5% | 0.1% |
| Non-Food Country Detail: Volume | ||||||
| Germany | -0.6% | 2.8% | -4.3% | -8.5% | 6.9% | 0.7% |
| France | #N/A | 1.1% | 0.1% | 5.4% | 6.1% | 6.1% |
| Italy (Total Value) | #N/A | 0.0% | -0.2% | -3.0% | -1.8% | -1.2% |
| UK (EU) | 0.9% | 0.9% | 0.4% | 9.1% | 10.1% | 8.0% |
| Shaded areas calculated on a one-month lag due to lagging data | ||||||
| The EA 13 countries are Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Slovenia and Spain. | ||||||
