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Economy in Brief
U.S. Consumer Credit Growth Surges in June
Consumer credit outstanding jumped $40.1 billion (7.7% y/y) in June...
Japan's LEI Waffles and Slows
Japan's leading economic index in June slipped to 100.6...
U.S. Foreign Trade Deficit Narrows in June
The U.S. trade deficit in goods and services (BOP basis) fell to $79.61 billion in June...
U.S. Unemployment Claims Remain on an Uptrend
Initial claims for unemployment insurance filed in the week ended July 30 rose 6,000 to 260,000...
RICS Survey Shows Weakening U.K. Housing Market
With the Bank of England hiking its key rate by 50 basis points and planning to squeeze its balance sheet...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
Excess Demand for Goods Caused Supply Constraints
Q2 GDP Does Not Confirm Economic Recession, But It Does Confirm A Corporate Profit Recession
State Coincident Indexes in June 2022
State Labor Markets in June 2022
No Recession Call Can Be Made Before BEA Explains The Record Gap Between Income & Output
by Robert Brusca October 10, 2007
EMU growth is cropping to be strong in Q3, at least for industrial output. In France manufacturing output excluding energy is up at a 9% annualized Q/Q rate. In Germany output is up at a 7.9% rate. In Spain its up at an 8% rate. Even Italy shows a 4.4% rate of increase. The UK, an EU member, is showing slower IP growth in Q3 as output is up at just a 0.8% rate of increase. Sequential IP growth figures show us that growth has been accelerating in Germany, France and Italy. Spain shows sudden weakness in the most recent three months The UK shows some sporadic slowing as the recent rates of growth reveal a slow down over three months but over six months, a speed up.
On balance, despite weakening orders and slowdown assessment from Germanys Chamber of Commerce (DIHK) and weaker surveys from the Reuters NTC survey as well as from various national surveys, actual production has been on an accelerating run. What we see is that this acceleration is counter to what surveys say they now expect. Some of the divergence reflects inter-temporal discord and mismatch. Since the financial market situation only began to turn abruptly in August before mid month, it is the reports of the next several months that should be most revealing as far as output is concerned. Up to now what we see is that, despite some weaker (and more topical) survey findings, actual output has remained firm through August for the main economies of EMU. Separately what survey data tell us is this: dont get used to it.
Main Euro Area Countries and UK IP in MFG | |||||||
---|---|---|---|---|---|---|---|
M/M | |||||||
Aug-07 | Jul-07 | Jun-07 | 3-Month | 6-month | 12-month | Q2-Date | |
Germany: Mfg IP | 1.8% | 0.2% | -0.3% | 7.2% | 5.6% | 6.2% | 7.9% |
France: IP ex Construction | 0.3% | 1.7% | -0.5% | 6.3% | 3.3% | 2.6% | 9.0% |
Italy: Mfg IP | 1.5% | 0.1% | -0.2% | 5.9% | 2.1% | 1.2% | 4.4% |
Spain: Mfg IP | 1.3% | 1.7% | -4.2% | -5.3% | 3.9% | 0.5% | 8.0% |
UK: Mfg IP | 0.4% | -0.2% | 0.1% | 1.2% | 3.4% | 0.6% | 0.8% |