Global| Aug 11 2008French IP is Losing Momentum Across Sectors
Summary
In June French IP fell by 0.4%, unexpected weakness. It has now dropped in two of the past three months and is falling sharply in the current quarter, at a -5.3% annual rate. Italy, like France, has had a very weak May but managed [...]
In June French IP fell by 0.4%, unexpected weakness. It has
now dropped in two of the past three months and is falling sharply in
the current quarter, at a -5.3% annual rate. Italy, like France, has
had a very weak May but managed some output increases in June. Still,
Italy’s IP is dropping in Q2 as well.
The sequential growth rates in France shows a clear ongoing
deterioration. This is what the OECD trend-adjusted leading indicators
pointed to last week. France has more severe downward momentum that
most other EMU nations.
Italy’s path lower is more jagged with a rise in output over
six months and an actual ongoing acceleration in the output of consumer
goods, 12mo to 6mo to 3mo. This is very odd since the export markets
seem to be declining for other EMU countries (like Germany) and Italy’s
own domestic demand for consumer goods is quite weak. Still it may be
that Italy’s consumer goods output is more volatile than it is strong.
The recent monthly results have been extremely choppy.
| French IP excluding construction | |||||||
|---|---|---|---|---|---|---|---|
| Saar except m/m | Jun-08 | May-08 | Apr-08 | 3-mo | 6-mo | 12-mo | Quarter-to-date |
| IP total | -0.4% | -2.9% | 1.3% | -7.8% | -4.9% | -1.6% | -5.3% |
| Consumer | 0.5% | -1.5% | 0.0% | -3.9% | -1.8% | -4.3% | -7.4% |
| Capital | -1.0% | -1.2% | 2.4% | 0.3% | 1.2% | 1.9% | 3.5% |
| Intermediate | -0.4% | -2.9% | 1.3% | -8.0% | -4.7% | -2.7% | -7.5% |
| Memo | |||||||
| Auto | -2.9% | -7.6% | 2.8% | -27.6% | -21.8% | -5.7% | -21.2% |
| Italy IP excluding construction | |||||||
| Saar except m/m | Jun-08 | May-08 | Apr-08 | 3-mo | 6-mo | 12-mo | Quarter-to-date |
| IP-MFG | 0.2% | -1.5% | 0.4% | -3.3% | 1.5% | -2.0% | -2.5% |
| Consumer Goods | 1.9% | -3.2% | 2.9% | 6.1% | 3.7% | 1.4% | -0.1% |
| Capital Goods | -0.8% | -2.5% | 1.7% | -6.4% | 8.3% | -1.9% | -2.3% |
| Intermediate | 0.5% | -1.7% | 0.5% | -2.5% | -1.3% | -3.7% | -3.9% |
| Memo | |||||||
| Transportation | -1.3% | -1.5% | -0.5% | -12.3% | 7.6% | -1.6% | 1.1% |
Robert Brusca
AuthorMore in Author Profile »Robert A. Brusca is Chief Economist of Fact and Opinion Economics, a consulting firm he founded in Manhattan. He has been an economist on Wall Street for over 25 years. He has visited central banking and large institutional clients in over 30 countries in his career as an economist. Mr. Brusca was a Divisional Research Chief at the Federal Reserve Bank of NY (Chief of the International Financial markets Division), a Fed Watcher at Irving Trust and Chief Economist at Nikko Securities International. He is widely quoted and appears in various media. Mr. Brusca holds an MA and Ph.D. in economics from Michigan State University and a BA in Economics from the University of Michigan. His research pursues his strong interests in non aligned policy economics as well as international economics. FAO Economics’ research targets investors to assist them in making better investment decisions in stocks, bonds and in a variety of international assets. The company does not manage money and has no conflicts in giving economic advice.
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