Global| Feb 03 2009PPI For E-Zone Is Plunging
Summary
Of course the ECB sets its inflation ceiling for the HICP (consumer price index) not for the PPI. Still, the sharp drop in Europes PPI inflation a drop that spreads pretty much across the board (see table) - is simply another [...]
Of course the ECB sets its inflation ceiling for the HICP (consumer price index) not for the PPI. Still, the sharp drop in Europe’s PPI inflation – a drop that spreads pretty much across the board (see table) - is simply another manifestation of weak inflation. Today the OECD reported that inflation in the OECD area was at a 37 year low. These sorts of results can be used to warn of the heightened risk for deflation in the OECD area as well. So far Europe and the ECB have not taken the bait. The Fed has recently shifted to a more public stance of worry about deflation risk. But Europe has been slow to adopt stimulus and the ECB countries to use rhetoric that brands inflation as now under control and is publicly no more worried than that.
| M/M | Saar | |||||
| Ezone-15 | Dec-08 | Nov-08 | 3-Mo | 6-MO | Yr/Yr | Y/Y Yr Ago |
| TotalxConstruct | -1.3% | -2.0% | -15.2% | -6.8% | 1.8% | 4.4% |
| Excl Energy | -0.6% | -0.9% | -7.4% | -2.3% | 1.6% | 3.2% |
| Capital Gds | 0.0% | 0.1% | 0.7% | 1.4% | 2.2% | 1.5% |
| Consurmer Gds | -0.2% | -0.3% | -2.2% | -0.6% | 1.5% | 4.0% |
| Intermediate&Cap Gds | -0.7% | -1.1% | -9.6% | -3.1% | 1.7% | 2.7% |
| Energy | -3.7% | -5.2% | -35.7% | -19.9% | 2.1% | 8.6% |
| MFG | -1.6% | -2.1% | -18.9% | -10.8% | -1.2% | 4.8% |
| Germany | -1.0% | -1.5% | -9.8% | -1.9% | 4.3% | 2.5% |
| Gy ExEnergy | -0.6% | -0.8% | -6.4% | -1.4% | 1.5% | 2.2% |
| Italy | -1.3% | -1.8% | -17.1% | -8.5% | 0.6% | 4.7% |
| It ExEnergy | -0.6% | -1.0% | -8.9% | -3.9% | 1.1% | 3.1% |
| UK | -1.3% | -2.2% | -18.9% | -15.1% | 5.7% | 7.9% |
| UK ExEnergy | 0.2% | -0.2% | -1.7% | 0.9% | 6.6% | 4.1% |
| E-zone 15 Harmonized PPI excluding Construction | ||||||
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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