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Economy in Brief
German PPI Accelerates
The German year-on-year PPI has generally been decelerating since early 2017...
U.S. Leading Economic Indicators Signal Continued Expansion
The Conference Board's Composite Index of Leading Economic Indicators increased 0.3% during March...
Philadelphia Fed Factory Conditions Improve; Prices Jump
The Philadelphia Fed reported that its General Factory Sector Business Conditions Index rose to 23.2 during April...
U.S. Initial Claims for Unemployment Insurance Are Little Changed
Initial unemployment insurance claims slipped to 232,000 (-6.1% y/y) during the week ended April 14...
U.K. Retail Sales Fall
U.K. GDP is expected to cool its jets when the first quarter GDP number is released...
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. | ||||||
