Tom Moeller

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051122b.jpg" width="353">
The International Council of Shopping Centers (ICSC)-UBS survey indicated that last week, chain store sales recovered more than all of the prior period&#39;s decline with a 1.0% jump. It was the second w/w jump that strong this month and it lifted the average level of sales in November 1.2% above October which rose 0.1% from September.
During the last ten years there has been a 51% correlation between the y/y change in chain store sales and the change in non-auto retail sales less gasoline, as published by the US Census Department. Chain store sales correspond directly with roughly 14% of non-auto retail sales less gasoline.
The leading indicator of chain store sales from ICSC rose 0.6% (-1.7% y/y) during the latest week following a 0.2% increase the prior week.
The ICSC-UBS retail chain-store sales index is constructed using the same-store sales (stores open for one year) reported by 78 stores of seven retailers: Dayton Hudson, Federated, Kmart, May, J.C. Penney, Sears and Wal-Mart. <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051122a.jpg" width="353">
Through the second week of November, the Johnson Redbook survey indicated a lesser 0.2% (3.5% y/y) gain in store sales versus October. The survey tracks 15 stores and reflects same-store sales of retailers that account for roughly 85% of the department store category in the Census Bureau&#39;s monthly retail sales report.
During the last nine years there has been a 67% correlation between the y/y change in the Redbook store sales index and the change in non-auto retail sales less gasoline, as published by the US Census Department.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/surveyw/@S2/@S2.HTM">ICSC-UBS (SA, 1977=100)</a></th>
<th scope="col">11/19/05</th>
<th scope="col">11/12/05</th>
<th scope="col">Y/Y</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Total Weekly Chain Store Sales</td>
<td>458.0</td>
<td>453.3</td>
<td>4.2%</td>
<td>4.6%</td>
<td>2.9%</td>
</tr>
</tbody>
</table>
Gasoline Prices Fell In A Competitive Market 
by <a href="/comment/Moeller.html">Tom Moeller</a> November 22, 2005


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051122c.jpg" width="353">
Last week, the US average retail gasoline price continued lower to $2.20 per gallon from $2.30 during the prior week and from $2.73 one month earlier. As of yesterday, the spot market price for gasoline was $1.44 per gallon and has roughly held that level for seven days.
Retail gasoline prices peaked in early September at $3.07 per gallon and have since fallen 72 cents or 28%. During that period spot gasoline prices are down $1.18 or 45%. The implied rise in gasoline retailers&#39; margins has restored profitability. However, that rise in the retail price of gasoline versus the spot price followed several years of margin decline.
During the past month margins have fallen roughly 20%, in part reflecting a decline in gasoline demand of up to 3.5% versus the year ago level. In turn, lower prices seem to have revived demand which spiked last week and raised the four week average level of gasoline demand to roughly even with a year earlier after declining sharply through September &amp; October. <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051122d.jpg" width="353">
Crude oil prices have continued lower as well. WTI crude yesterday at $57.21 per barrel was down versus an average of $62.50 during October and was 18% lower than the late August high of $69.82.
In November, natural gas prices reversed some of the strength of the prior three months. During the last three weeks gas prices averaged $10.08/mmbtu versus the high of $13.53 averaged during October. Nevertheless, prices still are up 71% versus all of last year.

<table border="0" cellspacing="0" width="100%">
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<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/daily/@D3/@D306/@D306.HTM">Energy Prices</a></th>
<th scope="col">11/21/05</th>
<th scope="col">12/31/04</th>
<th scope="col">Y/Y</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">US Retail Gasoline, Regular ($/Gal.)</td>
<td>$2.20</td>
<td>$1.79</td>
<td>13.0%</td>
<td>$1.85</td>
<td>$1.56</td>
<td>$1.35</td>
</tr>
<tr>
<td class="firstcol">Domestic Spot Market Price: West Texas Intermediate ($/Barrel)</td>
<td>$57.21</td>
<td>$41.78</td>
<td>18.0%</td>
<td>$41.78</td>
<td>$32.78</td>
<td>$31.23</td>
</tr>
</tbody>
</table>
Revisions and Additions to German National Accounts Data for Q3   
by <a href="/comment/Curley.html">Louise Curley</a> November 22, 2005


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051122e.jpg" width="353">
Final results for Germany&#39;s third quarter Gross Domestic Product were released today. In addition to revisions of the preliminary estimates of total GDP released a week ago, details of the composition of both the expenditure and income sides of the national accounts are given. Estimates of the contribution to growth of the various sectors are also available and are shown in the table below for the first three quarters of 2005.
In the first chart we show the contribution of domestic demand and net exports to total GDP growth. Over the past five years changes in both net exports and domestic demand have been erratic and have tended to offset one another. In the last quarter, a positive contribution of 1.30 percentage points from net exports was offset by a negative contribution of 0.60 percentage points from domestic demand.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051122f.jpg" width="353">
According to data on the income side of the National Accounts there has been a marked change in the distribution of income in Germany over the past five years. The share of compensation of employees in net national income has been declining over this period, as shown in the second chart. From 62.9% of net national income in the first quarter of 2001, employee compensation has declined to 58.5&amp; in the third quarter of 2005. The counterpart to the decline in the share of compensation has been the rise in the share of entrepreneurial income (shown in the third chart) from 25.1% in the first quarter of 2001 to 29.1% in the third quarter of 2005. The changing distribution of income may account for a part of the sluggish trend in private consumption over this period.<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051122g.jpg" width="353">

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">Germany Contribution to Growth</th>
<th scope="col">Q3 05&nbsp; % Pts</th>
<th scope="col">Q2 05 % Pts </th>
<th scope="col">Q1 05 % Pts</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Growth of Gross Domestic Product</td>
<td>0.70</td>
<td>0.0</td>
<td>0.10</td>
</tr>
<tr>
<td class="firstcol">Net Exports</td>
<td>1.30</td>
<td>-1.00</td>
<td>-0.50</td>
</tr>
<tr class="odd">
<td class="firstcol">Domestic Demand</td>
<td>-0.60</td>
<td>0.90</td>
<td>-0.40</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Consumption</td>
<td>-0.10</td>
<td>0.30</td>
<td>-0.30</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;&nbsp;&nbsp; Private</td>
<td>-0.10</td>
<td>0.00</td>
<td>-0.60</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;&nbsp; Government</td>
<td>0.00</td>
<td>0.30</td>
<td>0.20</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Gross Fixed Investment</td>
<td>0.20</td>
<td>0.10</td>
<td>0.10</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Inventories</td>
<td>-0.70</td>
<td>0.50</td>
<td>-0.20</td>
</tr>
<tr class="odd">
<td class="firstcol"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td class="firstcol">Share of Net National Income</td>
<td>Q1 01&nbsp; %&nbsp;</td>
<td>Q3 05 %&nbsp; </td>
<td></td>
</tr>
<tr class="odd">
<td class="firstcol">Compensation of Employees</td>
<td>62.9</td>
<td>59.5</td>
<td></td>
</tr>
<tr>
<td class="firstcol">Entrepreneurial Income</td>
<td>25.1&nbsp;</td>
<td>&nbsp;29.1</td>
<td>&nbsp;</td>
</tr>
</tbody>
</table>


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The International Council of Shopping Centers (ICSC)-UBS survey indicated that last week, chain store sales recovered more than all of the prior period's decline with a 1.0% jump. It was the second w/w jump that strong this month and [...]

Chain Store Sales Up

Louise Curley

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051121b.jpg" width="353">
The Euro Zone&#39;s surplus on trade in goods rose in September to 1,239.5 million euros from 190.0 million euros in August. This was only the third month this year in which a rise in the trade balance took place. For the nine months through September, the trade surplus is 57% below the corresponding period of 2004. The deterioration in the trade surplus is shown in the first chart.
The main factors in the deterioration of the trade surplus have been the rise in the euro which tended to dampen export demand and the rise in the price of oil which increased imports. The second chart shows the year-to-year increases in total imports and imports of mineral fuels and lubricants. Since early 2004 the year-to-year increase in imports of mineral fuels and lubricants has ranged between 25 and 50%. <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051121c.jpg" width="353">
The euro has been declining for most of this year and the price of crude has recently eased suggesting that the outlook for the balance of trade in goods is improving. The Euro has declined about 14% from the peak reached on December 30, 2004.Just two months ago the Brent Crude oil was $64.49 a barrel. It is now 18% lower at $52.66. The dollar value of the euro and the price of Brent Crude oil are shown in the third chart on a daily basis.<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051121d.jpg" width="353"> 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">Euro Zone Trade in Goods (Millions of Euros)</th>
<th scope="col">Sep 05&nbsp;</th>
<th scope="col">Aug 05</th>
<th scope="col">Sep 04</th>
<th scope="col">M/M %&nbsp;</th>
<th scope="col">Y/Y&nbsp;&nbsp;&nbsp; %</th>
<th scope="col">2004 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;</th>
<th scope="col">2003 &nbsp;</th>
<th scope="col">2002&nbsp;&nbsp;</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Trade Balance</td>
<td>1,239</td>
<td>190</td>
<td>2,673</td>
<td>1,049*</td>
<td>-1,434*</td>
<td>71,827</td>
<td>70,027</td>
<td>99,097</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Exports</td>
<td>107,019</td>
<td>106,672</td>
<td>95,492</td>
<td>0.33</td>
<td>12.07</td>
<td>1,144,937</td>
<td>1,059,880</td>
<td>1,083,611</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Imports</td>
<td>105,779</td>
<td>106,482</td>
<td>92,818</td>
<td>-0.66</td>
<td>13.96</td>
<td>1,073,110</td>
<td>989,853</td>
<td>984,514</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;&nbsp; Mineral Fuels &amp; Lubricants</td>
<td>22,285</td>
<td>23,126</td>
<td>15,545</td>
<td>-3.66</td>
<td>43.36</td>
<td>164,390</td>
<td>143,620</td>
<td>137,521</td>
</tr>
<tr class="odd">
<td class="firstcol"></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td class="firstcol"></td>
<td>Peak&nbsp;</td>
<td>Date</td>
<td>Current</td>
<td>Date</td>
<td>Pct Chg</td>
<td></td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td class="firstcol">Euro&nbsp; ($)</td>
<td>1.3623&nbsp;</td>
<td>12/30/04&nbsp;</td>
<td>1.1741&nbsp;</td>
<td>11/18/05&nbsp;</td>
<td>-13.8&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr>
<td class="firstcol">Brent Crude Oil&nbsp; ($/bbl)</td>
<td>64.49&nbsp;</td>
<td>9/21/05&nbsp;</td>
<td>52.66&nbsp;</td>
<td>11/18/05&nbsp;</td>
<td>-18.3&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr class="odd">
<td class="firstcol"></td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr>
<td class="firstcol">&nbsp;*Difference</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
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<td class="firstcol">&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
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The Euro Zone's surplus on trade in goods rose in September to 1,239.5 million euros from 190.0 million euros in August. This was only the third month this year in which a rise in the trade balance took place. For the nine months [...]

Declines in the Euro and the Price of Oil Improve the Euro Zone Balance of Trade in Goods

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051121a.jpg" width="353">
The Conference Board reported that the Composite Index of Leading Economic Indicators recovered 0.9% in October. The rise recouped virtually all of the index&#39;s declines since June.
The breadth of one month gain amongst the 10 components of the leading index improved to 70% and was the broadest since June. Lower claims for unemployment insurance and longer hours worked in the factory sector had the largest positive effects on the leaders&#39; one month change and offset large negative influences from lower stock prices and lower building permits.
The method of calculating the contribution to the index from the interest rate yield spread has been revised. A negative contribution will now occur only when the spread inverts rather than when declining as in the past. More details can be found <a href="http://www.conference-board.org/pdf_free/economics/bci/lei0705.pdf">here</a>.
The leading index is based on eight previously reported economic data series. Two series, orders for consumer goods and orders for capital goods, are estimated.
The coincident indicators rose 0.1% following an upwardly revised 0.3% rise during September. During the last ten years there has been a 64% correlation between the change in the coincident indicators and real GDP.
The lagging indicators rose 0.8%. Higher C&amp;I loans and a higher services CPI growth rate contributed greatly to the October increase. The ratio of coincident to lagging indicators, a measure of actual economic performance versus excess, fell after an upwardly revised September gain to its lowest level since late 2003.
Visit the Conference Board&#39;s <a href="http://www.conference-board.org">site</a> for coverage of leading indicator series from around the world. 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/BCI/BCI.HTM">Business Cycle Indicators</a></th>
<th scope="col">Oct</th>
<th scope="col">Sept</th>
<th scope="col">6 Month Chg., AR</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Leading</td>
<td>0.9%</td>
<td>-0.8%</td>
<td>2.4%</td>
<td>7.7%</td>
<td>5.1%</td>
<td>5.0%</td>
</tr>
<tr>
<td class="firstcol">Coincident</td>
<td>0.1%</td>
<td>0.3%</td>
<td>1.2%</td>
<td>2.7%</td>
<td>0.4%</td>
<td>-0.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Lagging</td>
<td>0.8%</td>
<td>-0.2%</td>
<td>3.4%</td>
<td>-0.1%</td>
<td>-0.1%</td>
<td>-0.7%</td>
</tr>
</tbody>
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</body>
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The Conference Board reported that the Composite Index of Leading Economic Indicators recovered 0.9% in October. The rise recouped virtually all of the index's declines since June. The breadth of one month gain amongst the 10 [...]

Leading Economic Indicators Recovered

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051121a.jpg" width="353">
The Conference Board reported that the Composite Index of Leading Economic Indicators recovered 0.9% in October. The rise recouped virtually all of the index&#39;s declines since June.
The breadth of one month gain amongst the 10 components of the leading index improved to 70% and was the broadest since June. Lower claims for unemployment insurance and longer hours worked in the factory sector had the largest positive effects on the leaders&#39; one month change and offset large negative influences from lower stock prices and lower building permits.
The method of calculating the contribution to the index from the interest rate yield spread has been revised. A negative contribution will now occur only when the spread inverts rather than when declining as in the past. More details can be found <a href="http://www.conference-board.org/pdf_free/economics/bci/lei0705.pdf">here</a>.
The leading index is based on eight previously reported economic data series. Two series, orders for consumer goods and orders for capital goods, are estimated.
The coincident indicators rose 0.1% following an upwardly revised 0.3% rise during September. During the last ten years there has been a 64% correlation between the change in the coincident indicators and real GDP.
The lagging indicators rose 0.8%. Higher C&amp;I loans and a higher services CPI growth rate contributed greatly to the October increase. The ratio of coincident to lagging indicators, a measure of actual economic performance versus excess, fell after an upwardly revised September gain to its lowest level since late 2003.
Visit the Conference Board&#39;s <a href="http://www.conference-board.org">site</a> for coverage of leading indicator series from around the world. 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/BCI/BCI.HTM">Business Cycle Indicators</a></th>
<th scope="col">Oct</th>
<th scope="col">Sept</th>
<th scope="col">6 Month Chg., AR</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Leading</td>
<td>0.9%</td>
<td>-0.8%</td>
<td>2.4%</td>
<td>7.7%</td>
<td>5.1%</td>
<td>5.0%</td>
</tr>
<tr>
<td class="firstcol">Coincident</td>
<td>0.1%</td>
<td>0.3%</td>
<td>1.2%</td>
<td>2.7%</td>
<td>0.4%</td>
<td>-0.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Lagging</td>
<td>0.8%</td>
<td>-0.2%</td>
<td>3.4%</td>
<td>-0.1%</td>
<td>-0.1%</td>
<td>-0.7%</td>
</tr>
</tbody>
</table>
Declines in the Euro and the Price of Oil Improve the  Euro Zone Balance of Trade in Goods  
by <a href="/comment/Curley.html">Louise Curley</a> November 21, 2005


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051121b.jpg" width="353">
The Euro Zone&#39;s surplus on trade in goods rose in September to 1,239.5 million euros from 190.0 million euros in August. This was only the third month this year in which a rise in the trade balance took place. For the nine months through September, the trade surplus is 57% below the corresponding period of 2004. The deterioration in the trade surplus is shown in the first chart.
The main factors in the deterioration of the trade surplus have been the rise in the euro which tended to dampen export demand and the rise in the price of oil which increased imports. The second chart shows the year-to-year increases in total imports and imports of mineral fuels and lubricants. Since early 2004 the year-to-year increase in imports of mineral fuels and lubricants has ranged between 25 and 50%. <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051121c.jpg" width="353">
The euro has been declining for most of this year and the price of crude has recently eased suggesting that the outlook for the balance of trade in goods is improving. The Euro has declined about 14% from the peak reached on December 30, 2004.Just two months ago the Brent Crude oil was $64.49 a barrel. It is now 18% lower at $52.66. The dollar value of the euro and the price of Brent Crude oil are shown in the third chart on a daily basis.<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051121d.jpg" width="353"> 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">Euro Zone Trade in Goods (Millions of Euros)</th>
<th scope="col">Sep 05&nbsp;</th>
<th scope="col">Aug 05</th>
<th scope="col">Sep 04</th>
<th scope="col">M/M %&nbsp;</th>
<th scope="col">Y/Y&nbsp;&nbsp;&nbsp; %</th>
<th scope="col">2004 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;</th>
<th scope="col">2003 &nbsp;</th>
<th scope="col">2002&nbsp;&nbsp;</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Trade Balance</td>
<td>1,239</td>
<td>190</td>
<td>2,673</td>
<td>1,049*</td>
<td>-1,434*</td>
<td>71,827</td>
<td>70,027</td>
<td>99,097</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Exports</td>
<td>107,019</td>
<td>106,672</td>
<td>95,492</td>
<td>0.33</td>
<td>12.07</td>
<td>1,144,937</td>
<td>1,059,880</td>
<td>1,083,611</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Imports</td>
<td>105,779</td>
<td>106,482</td>
<td>92,818</td>
<td>-0.66</td>
<td>13.96</td>
<td>1,073,110</td>
<td>989,853</td>
<td>984,514</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp;&nbsp;&nbsp; Mineral Fuels &amp; Lubricants</td>
<td>22,285</td>
<td>23,126</td>
<td>15,545</td>
<td>-3.66</td>
<td>43.36</td>
<td>164,390</td>
<td>143,620</td>
<td>137,521</td>
</tr>
<tr class="odd">
<td class="firstcol"></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td class="firstcol"></td>
<td>Peak&nbsp;</td>
<td>Date</td>
<td>Current</td>
<td>Date</td>
<td>Pct Chg</td>
<td></td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td class="firstcol">Euro&nbsp; ($)</td>
<td>1.3623&nbsp;</td>
<td>12/30/04&nbsp;</td>
<td>1.1741&nbsp;</td>
<td>11/18/05&nbsp;</td>
<td>-13.8&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr>
<td class="firstcol">Brent Crude Oil&nbsp; ($/bbl)</td>
<td>64.49&nbsp;</td>
<td>9/21/05&nbsp;</td>
<td>52.66&nbsp;</td>
<td>11/18/05&nbsp;</td>
<td>-18.3&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr class="odd">
<td class="firstcol"></td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr>
<td class="firstcol">&nbsp;*Difference</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
</tbody>
</table>
</body>
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Carol Stone, CBE

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051118a.jpg" width="353">
As readers are no doubt aware, among its many offerings, Haver Analytics carries a large number of regional databases. These cover such concepts as gross state product, county personal income, rental vacancy rates for all 50 states and 75 metropolitan areas. A client query the other day called our attention to a very simple set of data we have had in the general REGIONAL database for the last couple of years, the Philadelphia Fed&#39;s &quot;Coincident Economic Activity Indexes&quot; for all 50 states. <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051118b.jpg" width="353">
These indexes are simple, handy, and available promptly compared with much regional information. Data on all 50 states were published on November 1 for September. October data will be out December 1. History goes back to 1979. They are calculated from four indicators:nonfarm payrolls, the unemployment rate, the workweek in manufacturing and real wage and salary income. All four of these are available in comparable form for all 50 states. Based in a Stock &amp; Watson framework, log changes are used in compiling each month&#39;s figure, and the index trend is tied to gross state product, an annual figure. A full and authoritative description of the calculation appears in a Philadelphia Fed working paper, &quot;Consistent Indexes for the 50 States&quot; by Theodore Crone, circulated in June 2003. The paper can be accessed <a href="http://www.phil.frb.org/files/wps/2002/wp02-7r.pdf"> here</a> .<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051118c.jpg" width="353">
We know intuitively that regional and local economies behave differently and these indexes show that in a quick summary number. In the table below, we show five arbitrarily selected states, plus two national coincident indexes calculated by private institutions. These five state index levels through August vary from 124.2 to 158.0 on a base of July 1992=100, indicating widely varying degrees of overall vitality. Four of these states and most of the rest had gains through early summer. We see, though, that Louisiana had already had two down months in July and August. Its index then fell 14.5% in September, when Katrina hit. The index for Mississippi was off 4.0% that month. A few of the varying patterns among states are shown in our accompanying graphs. In the first graph, the tech boom and bust is evident in the comparison of Washington State with New York. The second graph shows the impact of Hurricane Katrina. Notice that states even right next to each other can show differing paths of economic activity; for example, North and South Dakota vary with ups and downs in many months, and South Dakota&#39;s index stood at 154.7 in September, while North Dakota&#39;s was only 133.1.
The Philadelphia Fed explains that it has compiled and maintains these indexes to facilitate research and analysis of just such cross-state and state/national economic interactions. According to the conclusion of the paper cited above, &quot;Possible issues include the study of state business cycles, the effect of national economic forces on individual states, and the effect of the state&#146;s overall economic activity on state fiscal conditions, poverty, or in-migration.&quot; 

<table border="0" cellspacing="0" width="100%">

</table>
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">Index Levels/% Changes</th>
<th scope="col">Sep 2005</th>
<th scope="col">Aug 2005</th>
<th scope="col">Jul 2005</th>
<th scope="col">Sep 2004</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Conference Board Coincident Indicators (rebased to 1992=100)</td>
<td>136.0</td>
<td>136.1</td>
<td>136.2</td>
<td>132.8</td>
<td>132.5</td>
<td>129.0</td>
<td>128.5</td>
</tr>
<tr>
<td class="firstcol">-0.1</td>
<td>-0.1</td>
<td>0.2</td>
<td>2.4</td>
<td>2.7</td>
<td>0.4</td>
<td>-0.6</td>
</tr>
<tr class="odd">
<td class="firstcol">ECRI Coincident Index (1992=100)</td>
<td>146.9</td>
<td>147.2</td>
<td>147.2</td>
<td>142.8</td>
<td>142.2</td>
<td>137.2</td>
<td>135.7</td>
</tr>
<tr>
<td class="firstcol">-0.2</td>
<td>0.0</td>
<td>0.3</td>
<td>2.9</td>
<td>3.7</td>
<td>1.1</td>
<td>-0.2</td>
</tr>
<tr class="odd">
<td colspan="4">Philly Fed State Indexes (July 1992=100)</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr>
<td class="firstcol">New York</td>
<td>140.0</td>
<td>139.9</td>
<td>139.5</td>
<td>136.1</td>
<td>135.2</td>
<td>132.0</td>
<td>131.0</td>
</tr>
<tr class="odd">
<td class="firstcol">0.1</td>
<td>0.3</td>
<td>0.2</td>
<td>2.9</td>
<td>2.4</td>
<td>0.7</td>
<td>-0.9</td>
</tr>
<tr>
<td class="firstcol">California</td>
<td>154.5</td>
<td>154.0</td>
<td>153.5</td>
<td>149.2</td>
<td>148.0</td>
<td>144.0</td>
<td>142.8</td>
</tr>
<tr class="odd">
<td class="firstcol">0.4</td>
<td>0.3</td>
<td>0.4</td>
<td>3.5</td>
<td>2.8</td>
<td>0.8</td>
<td>-0.1</td>
</tr>
<tr>
<td class="firstcol">Texas</td>
<td>158.2</td>
<td>158.0</td>
<td>157.7</td>
<td>154.1</td>
<td>153.2</td>
<td>149.6</td>
<td>149.3</td>
</tr>
<tr class="odd">
<td class="firstcol">0.1</td>
<td>0.2</td>
<td>0.2</td>
<td>2.7</td>
<td>2.4</td>
<td>0.2</td>
<td>-0.8</td>
</tr>
<tr>
<td class="firstcol">Iowa</td>
<td>143.0</td>
<td>142.6</td>
<td>142.2</td>
<td>138.3</td>
<td>137.7</td>
<td>134.5</td>
<td>133.9</td>
</tr>
<tr class="odd">
<td class="firstcol">0.2</td>
<td>0.3</td>
<td>0.3</td>
<td>3.3</td>
<td>2.4</td>
<td>0.4</td>
<td>-0.8</td>
</tr>
<tr>
<td class="firstcol">Louisiana</td>
<td>106.2</td>
<td>124.2</td>
<td>125.3</td>
<td>124.5</td>
<td>124.5</td>
<td>123.3</td>
<td>122.6</td>
</tr>
<tr class="odd">
<td class="firstcol">-14.5</td>
<td>-0.6</td>
<td>-0.4</td>
<td>-14.7</td>
<td>1.0</td>
<td>0.5</td>
<td>-1.0</td>
</tr>
</tbody>
</table>
</body>
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As readers are no doubt aware, among its many offerings, Haver Analytics carries a large number of regional databases. These cover such concepts as gross state product, county personal income, rental vacancy rates for all 50 states [...]

State Coincident Indexes Highlight Regional Differences in Economic Activity

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051118a.jpg" width="353">
As readers are no doubt aware, among its many offerings, Haver Analytics carries a large number of regional databases. These cover such concepts as gross state product, county personal income, rental vacancy rates for all 50 states and 75 metropolitan areas. A client query the other day called our attention to a very simple set of data we have had in the general REGIONAL database for the last couple of years, the Philadelphia Fed&#39;s &quot;Coincident Economic Activity Indexes&quot; for all 50 states.
These indexes are simple, handy, and available promptly compared with much regional information. Data on all 50 states were published on November 1 for September. October data will be out December 1. History goes back to 1979. They are calculated from four indicators:nonfarm payrolls, the unemployment rate, the workweek in manufacturing and real wage and salary income. All four of these are available in comparable form for all 50 states. Based in a Stock &amp; Watson framework, log changes are used in compiling each month&#39;s figure, and the index trend is tied to gross state product, an annual figure. A full and authoritative description of the calculation appears in a Philadelphia Fed working paper, &quot;Consistent Indexes for the 50 States&quot; by Theodore Crone, circulated in June 2003. The paper can be accessed <a href="http://www.phil.frb.org/files/wps/2002/wp02-7r.pdf"> here</a> . <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051118a.jpg" width="353">
We know intuitively that regional and local economies behave differently and these indexes show that in a quick summary number. In the table below, we show five arbitrarily selected states, plus two national coincident indexes calculated by private institutions. These five state index levels through August vary from 124.2 to 158.0 on a base of July 1992=100, indicating widely varying degrees of overall vitality. Four of these states and most of the rest had gains through early summer. We see, though, that Louisiana had already had two down months in July and August. Its index then fell 14.5% in September, when Katrina hit. The index for Mississippi was off 4.0% that month. A few of the varying patterns among states are shown in our accompanying graphs. In the first graph, the tech boom and bust is evident in the comparison of Washington State with New York. The second graph shows the impact of Hurricane Katrina. Notice that states even right next to each other can show differing paths of economic activity; for example, North and South Dakota vary with ups and downs in many months, and South Dakota&#39;s index stood at 154.7 in September, while North Dakota&#39;s was only 133.1.
The Philadelphia Fed explains that it has compiled and maintains these indexes to facilitate research and analysis of just such cross-state and state/national economic interactions. According to the conclusion of the paper cited above, &quot;Possible issues include the study of state business cycles, the effect of national economic forces on individual states, and the effect of the state&#146;s overall economic activity on state fiscal conditions, poverty, or in-migration.&quot; 

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</table>
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">Index Levels/% Changes</th>
<th scope="col">Sep 2005</th>
<th scope="col">Aug 2005</th>
<th scope="col">Jul 2005</th>
<th scope="col">Sep 2004</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Conference Board Coincident Indicators (rebased to 1992=100)</td>
<td>136.0</td>
<td>136.1</td>
<td>136.2</td>
<td>132.8</td>
<td>132.5</td>
<td>129.0</td>
<td>128.5</td>
</tr>
<tr>
<td class="firstcol">-0.1</td>
<td>-0.1</td>
<td>0.2</td>
<td>2.4</td>
<td>2.7</td>
<td>0.4</td>
<td>-0.6</td>
</tr>
<tr class="odd">
<td class="firstcol">ECRI Coincident Index (1992=100)</td>
<td>146.9</td>
<td>147.2</td>
<td>147.2</td>
<td>142.8</td>
<td>142.2</td>
<td>137.2</td>
<td>135.7</td>
</tr>
<tr>
<td class="firstcol">-0.2</td>
<td>0.0</td>
<td>0.3</td>
<td>2.9</td>
<td>3.7</td>
<td>1.1</td>
<td>-0.2</td>
</tr>
<tr class="odd">
<td colspan="4">Philly Fed State Indexes (July 1992=100)</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
<td>&nbsp;</td>
</tr>
<tr>
<td class="firstcol">New York</td>
<td>140.0</td>
<td>139.9</td>
<td>139.5</td>
<td>136.1</td>
<td>135.2</td>
<td>132.0</td>
<td>131.0</td>
</tr>
<tr class="odd">
<td class="firstcol">0.1</td>
<td>0.3</td>
<td>0.2</td>
<td>2.9</td>
<td>2.4</td>
<td>0.7</td>
<td>-0.9</td>
</tr>
<tr>
<td class="firstcol">California</td>
<td>154.5</td>
<td>154.0</td>
<td>153.5</td>
<td>149.2</td>
<td>148.0</td>
<td>144.0</td>
<td>142.8</td>
</tr>
<tr class="odd">
<td class="firstcol">0.4</td>
<td>0.3</td>
<td>0.4</td>
<td>3.5</td>
<td>2.8</td>
<td>0.8</td>
<td>-0.1</td>
</tr>
<tr>
<td class="firstcol">Texas</td>
<td>158.2</td>
<td>158.0</td>
<td>157.7</td>
<td>154.1</td>
<td>153.2</td>
<td>149.6</td>
<td>149.3</td>
</tr>
<tr class="odd">
<td class="firstcol">0.1</td>
<td>0.2</td>
<td>0.2</td>
<td>2.7</td>
<td>2.4</td>
<td>0.2</td>
<td>-0.8</td>
</tr>
<tr>
<td class="firstcol">Iowa</td>
<td>143.0</td>
<td>142.6</td>
<td>142.2</td>
<td>138.3</td>
<td>137.7</td>
<td>134.5</td>
<td>133.9</td>
</tr>
<tr class="odd">
<td class="firstcol">0.2</td>
<td>0.3</td>
<td>0.3</td>
<td>3.3</td>
<td>2.4</td>
<td>0.4</td>
<td>-0.8</td>
</tr>
<tr>
<td class="firstcol">Louisiana</td>
<td>106.2</td>
<td>124.2</td>
<td>125.3</td>
<td>124.5</td>
<td>124.5</td>
<td>123.3</td>
<td>122.6</td>
</tr>
<tr class="odd">
<td class="firstcol">-14.5</td>
<td>-0.6</td>
<td>-0.4</td>
<td>-14.7</td>
<td>1.0</td>
<td>0.5</td>
<td>-1.0</td>
</tr>
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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051117f.jpg" width="353">
Mexico&#39;s GDP was either strong or weak in Q3, according to who you listen to and which comparisons you make. The data were reported yesterday afternoon by INEGI, Mexico&#39;s statistical agency. The year-on-year gain of 3.3% was less than a government forecast, Reuters explained, but slightly larger than private market forecasts. Seasonally adjusted, the quarter saw a 2.1% increase (quarterly rate) after a basically flat performance in Q1 (+0.2%) and Q2 (-0.3%). It was this pattern that Dow Jones highlighted, with a headline in the Wall Street Journal that read &quot;Mexico Growth Picks Up...&quot;. <img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051117g.jpg" width="353">
A further divergence of interpretation concerns manufacturing. This important sector has experienced considerable variability in recent years. From Q3 2004, this latest period&#39;s value added rose a mere 0.2%, less than Q2&#39;s 2.6% yearly increase. The retreat was led by metals and metal products. Based on seasonal adjustment of the industry data by Haver Analytics, these, along with &quot;other manufacturing&quot;, showed considerable quarter-to-quarter declines. Some attribute this to weakness in the US motor vehicle industry, although collateral data, such as unit vehicle imports into the US as published by the US Commerce Department, don&#39;t indicate any decline. At the same time, for the entire factory sector, some analysts apparently feared a decrease from a year earlier, so the 0.2% rise, modest as it is, was of some comfort.
Other notable sectors of the Mexican economy contributed to the mixed reading on its health. Agriculture, constituting a relatively small proportion of total GDP, had a substantial increase in Q3, 10.6% year-to-year after outright declines in the first half of 2005. Finance also strengthened, with a 6.2% increase; this industry group has been expanding consistently over the last couple of years. The largest sector of the Mexican economy is domestic trade and tourism, contributing just under 20% of GDP last year. This year, it continues to expand, but more slowly, with a 3.1% yearly increase in Q3, notably less than the 4.9% in 2004. As we face Q4, cross-currents will continue to raise questions for the nation: the storms in October, continuing uncertainty in the big US vehicle market, and volatile energy markets. Stay tuned.

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<th scope="col" class="firstcol">Mexico GDP &amp; Select Industries, &nbsp;% Changes, NSA unless noted</th>
<th scope="col">Q3 2005</th>
<th scope="col">Q2 2005</th>
<th scope="col">Q1 2005</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Real GDP, SA (100%*)</td>
<td>2.1</td>
<td>-0.3</td>
<td>0.2</td>
<td>--</td>
<td>--</td>
<td>--</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Yr/Yr, NSA</td>
<td>3.3</td>
<td>3.1</td>
<td>2.4</td>
<td>4.4</td>
<td>1.4</td>
<td>0.8</td>
</tr>
<tr class="odd">
<td class="firstcol">Agriculture (5.3%*)</td>
<td>10.6</td>
<td>-3.3</td>
<td>-1.5</td>
<td>4.0</td>
<td>3.5</td>
<td>0.1</td>
</tr>
<tr>
<td class="firstcol">Manufacturing (18.2%*)</td>
<td>0.2</td>
<td>2.6</td>
<td>-0.2</td>
<td>3.8</td>
<td>-1.3</td>
<td>-0.7</td>
</tr>
<tr class="odd">
<td class="firstcol">Wholesale &amp; Retail Trade/Restaurants &amp; Hotels &nbsp; (19.8%*)</td>
<td>3.1</td>
<td>3.5</td>
<td>3.3</td>
<td>4.9</td>
<td>1.6</td>
<td>0.0</td>
</tr>
<tr>
<td class="firstcol">Finance/Insurance/ Banking &nbsp; (15.9%*)</td>
<td>6.2</td>
<td>5.5</td>
<td>5.1</td>
<td>4.6</td>
<td>3.9</td>
<td>4.2</td>
</tr>
</tbody>
</table>
</body>
</html>

Mexico's GDP was either strong or weak in Q3, according to who you listen to and which comparisons you make. The data were reported yesterday afternoon by INEGI, Mexico's statistical agency. The year-on-year gain of 3.3% was less than [...]

Mexico's GDP Expands 3.3% in Q3: Is This Good or Bad?

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<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051117c.jpg" width="353">
A 25,000 decline last week in initial claims for unemployment insurance to 303,000 followed a little revised 3,000 increase the prior week and dropped claims to the lowest level since mid-April. Consensus expectations had been for a lesser decline 320,000 claims.
The latest figure covers the survey period for November nonfarm payrolls and claims were down 54,000 (15.1%) from the October period.
The Labor Department indicated that roughly 10,000 new claims last week were related to hurricanes Katrina and Rita, bringing the total since Sept. 3 linked to the Gulf Coast storms to an unadjusted 545,000 claims. Hurricane Wilma, which struck Florida late last month, led to roughly 9,000 claims bringing the total to 16,400 related claims since that storm hit.
The four-week moving average of initial claims fell sharply to 321,500 (-4.2% y/y), the lowest level since early September.
Continuing claims for unemployment insurance rose 3,000 following a downwardly revised 5,000 drop during the prior week.
The insured rate of unemployment remained at 2.2% for the eighth week.
Spendthrift Nation from the Federal Reserve Bank of San Francisco can be found <a href="http://www.frbsf.org/publications/economics/letter/2005/el2005-30.pdf"> here</a>.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/WEEKLY/@W5/@W507/@W507.HTM">Unemployment Insurance (000s)</a></th>
<th scope="col">11/12/05</th>
<th scope="col">11/05/05</th>
<th scope="col">Y/Y</th>
<th scope="col">2004</th>
<th scope="col">2003</th>
<th scope="col">2002</th>
</tr>
</thead>
<tbody>
<tr>
<td class="firstcol">Initial Claims</td>
<td>303</td>
<td>328</td>
<td>-9.8%</td>
<td>343</td>
<td>402</td>
<td>404</td>
</tr>
<tr>
<td class="firstcol">Continuing Claims</td>
<td>--</td>
<td>2,793</td>
<td>0.3%</td>
<td>2,926</td>
<td>3,531</td>
<td>3,570</td>
</tr>
</tbody>
</table>
</body>
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A 25,000 decline last week in initial claims for unemployment insurance to 303,000 followed a little revised 3,000 increase the prior week and dropped claims to the lowest level since mid-April. Consensus expectations had been for a [...]

Initial Claims for Jobless Insurance Lowest Since April

Global freight costs are on the rise while supply chain pressures are contained

Accelerating positive economic surprises in the G10 are boosting the global economy

Considerably more monetary ease expected from US and UK as Japan tightens

Tighter US immigration enforcement adversely impacting labor force

Economic policy uncertainty, while still elevated, is declining

Gradual disinflation and easier monetary policies across advanced economies

Largest October layoffs since 2003, led by technology

Subdued global shipping costs not yet pointing to supply chain problems

PMIs show still-elevated but slowing US inflation

AI boosting US investment in data centers

US productivity growth has been significantly faster than in other major economies

Consumers' short-term US inflation expectations still elevated while longer-term expectations of financial markets are steady

US financial markets have gotten used to elevated policy uncertainty

FOMC now expects more rate cuts going forward than in June

China gaining ASEAN exports while US exports slump

Job openings less than the number unemployed in July for first time since 2021

Reaccelerating goods price inflation along with sticky services inflation clouds the outlook

Falling oil prices aren't pulling down inflation expectations, pointing to a boost from increased tariffs

Equity market exuberance outpacing macroeconomic data

Apart from Japan, Blue Chip forecasters expect further sizable monetary easing

US production rebounded in Q2, but demand continued to slow

US leader, Germany trailer for real GDP growth over past 3 years

Negative US inflation surprises leading G10 down

Deflation continues in China

Incoming data surprising on downside in US; positive surprises elsewhere

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The Consumer Price Index increased 2.7% y/y during November, down from 2.8% in October. The 0.2% m/m increase fell short of the 0.3% gain expected in the Action Economics Forecast Survey. The y/y gain in the headline CPI was the weakest since April. It was down from September’s high of 3.0% and compared to 2.9% during 2024. The CPI excluding food & energy increased 0.1% (2.6% y/y) in November. Its y/y rise compared to 2.8% y/y in October and was the weakest rise since March 2021.	

Energy prices rose 1.6% (4.1% y/y in November. Gasoline prices strengthened 3.0% (0.9% y/y). Fuel oil prices increased 3.1% (11.3% y/y). Natural gas prices fell 2.1% (+9.1% y/y), and electricity prices strengthened 1.1% (6.9% y/y). 
Food prices rose 0.1% (2.6% y/y) during November. Egg prices declined 6.4% (-13.2% y/y). Meat, poultry & fish prices strengthened 0.8% (6.8% y/y), while dairy product prices fell 0.9% (-1.6% y/y). Cereal & bakery product costs held steady (+1.9% y/y). Fruit & vegetable prices fell 0.4% and were little changed y/y. Nonalcoholic beverage prices increased 0.9% and 4.3% y/y in November.

Goods prices less food and energy rose 0.2% and rose a steady 1.4% y/y during November. Prices of used cars and trucks increased 0.3% (3.6% y/y), and new vehicle costs rose 0.2% (0.6% y/y). Appliance prices fell 0.6% (+0.5% y/y) while home furnishings prices rose 0.4% (2.6% y/y). Recreation product costs fell 0.3% but increased 0.7% y/y in November. Apparel prices increased 0.6% (0.1% y/y) in November. Education & communication product costs declined 0.3% (-3.1% y/y). Medical care goods prices rose 0.1% (1.1% y/y) in November. 

Services prices less energy edged 0.1% higher but increased 3.0% y/y in November, down from 7.0% y/y in 2022. Shelter prices (35.5% of the CPI) rose 0.1% (3.0% y/y), as owners’ equivalent rent of primary residences also rose 0.1% (3.4% y/y). Transportation service prices fell 0.3% (1.7% y/y). The cost of medical services edged 0.1% and rose 3.3% y/y, and the cost of recreation services fell 0.3% (+2.4% y/y). Education & communication services prices increased 0.4% m/m and 2.2% y/y.

The Consumer Price figures can be found in Haver's **USECON** database. The expectations figure is contained in the **AS1REPNA** database.

For the release of CPI on December 18, 2025, the BLS was able to retroactively acquire most nonsurvey data for October and will publish October 2025 values where possible. However, the majority of the CPI series rely on survey data which was not collected for October 2025 due to the government shutdown. Accordingly, the BLS will not publish October values for those series. Haver Analytics has created a second set of CPI indexes and relative importance series in **USECON**. These series will contain any published BLS values for October and interpolated values for unpublished detailed indexes. We will then calculate higher aggregate series such as the All Items index and All Items less food and energy using any published indexes along with our interpolated indexes and relative importance. 


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- Year-to-year comparison is slowest in four months.
- Core price gain exhibits weakest y/y increase since 2021. 
- Services price inflation tumbles y/y; core goods price gain is stable.


U.S. Consumer Price Inflation Moderates in November

Sandy Batten

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Existing home sales rose 0.5% m/m (-1.0% y/y) in November to 4.13 million homes (SAAR) following a 1.5% monthly gain in October and a 1.3% monthly rise in September, according to the National Association of Realtors (NAR). It was the highest level of sales since February and matched expectations in the Action Economics Forecast Survey. The average effective 30-year mortgage interest rate was unchanged at 6.54% last month, but this is down markedly from 7.10% in May and accounts for some of the revival in home sales over the past several months. The sales figures are based on closings of sales contracts signed over the past couple of months.

Existing single-family home sales rose 0.8% m/m (-0.8% y/y) in November to 3.75 million units after a 1.1% m/m rise in October and a 1.4% monthly gain in September. Sales of condos and co-ops slumped 2.6% m/m (-2.6% y/y) to 380,000 in November following a 5.4% monthly jump in October.

Compared to a month ago, sales rose 4.1% m/m in the Northeast, increased 1.1% m/m in the South, were unchanged in the West and fell 2.0% m/m in the Midwest. Compared to a year ago, sales were unchanged in both the Northeast and the South, fell 3.0% y/y in the Midwest and declined 1.3% y/y in the West.

The median price of all existing homes (NSA) declined 1.4% m/m (+1.2% y/y) to $409,200 in November. The median price of an existing single-family home fell 1.4% m/m (+1.2% y/y) to $414,300 in November. Prices of single-family homes in the Northeast edged up 0.9% from a year ago. Prices in the Midwest jumped 5.8% y/y; prices in the South rose 1.0% y/y. In contrast, prices in the West declined 0.8% from a year ago.

Inventories of homes for sale continued to weaken in November. The number of existing homes for sale (NSA) slumped 5.9% m/m (+7.5% y/y) to 1.43 million units in November. The supply of homes on the market at the current selling rate (NSA) slid to 4.2 months, its lowest reading since March.

The data on existing home sales, prices and affordability are compiled by the National Association of Realtors. The data on single-family home sales extend back to February 1968. Total sales and price data and regional sales can be found in Haver's **USECON** database. Regional price and affordability data and national inventory data are available in the **REALTOR** database. Mortgage interest rates can be found in the **WEEKLY** database. The expectations figure is from the Action Economics Forecast Survey, reported in the **AS1REPNA** database.


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- Existing home sales increased 0.5% m/m in November, the third consecutive monthly gain.
- Month-over-month sales increased in the Northeast and South, were unchanged in the West, and fell in the Midwest.
- Year-over-year sales were unchanged in the Northeast and South and decreased in the Midwest and West.


U.S. Existing Home Sales Edged Up in November

Robert Brusca

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The new UK Confederation of British Industry (CBI) survey on the distributive trades sector shows a sharp weakening of an already weak survey for December and for the outlook into January of 2026. 

The month-to-month deterioration from November was widespread across metrics for retailing as well as for wholesaling for the current month as well as for the outlook. The monthly degradation is without exception across the board - omitting the inventory metric which is a different animal in any event since inventory building is sometimes involuntary. 

**The Retail survey**
Current conditions: In December, the retail survey for sales compared to a year ago, orders compared to year ago, and sales for the time of year (a seasonal adjustment metric), all worsened month-to-month. The November readings were weak and in December sales compared to a year-ago worsened by 12 points, Orders compared to a year ago worsened by 17 points month-to-month and sales for the time of year worsened by 11 points. These metrics for December are below their respective 12-month average by 6 to 13 points, as well for these categories. The rankings tell a stark story, year-on-year sales have been lower only 5.3% of the time, Year-on-year orders have been weaker only 5.6% of the time, while time of the year sales have been lower only 13% of the time. These are all extremely low-ranking metrics.

Expected Conditions: In January expected conditions have weakened month-to-month by amounts ranging from 33 points to 16 points depending on the metric. And sales and orders compared to a year ago as well as sales for the time of year each are weaker than their respective 12-month average readings by amounts ranging from 4 points to 23 points. The rankings on expectations are even worse than for the current metrics. Expected sales compared to a year ago rank lower less than 1% of the time, the same is true of orders. While sales for the time of year have been weaker 7.7 percent of the time. 
 
**Wholesale survey** 
The rankings for wholesaling are even lower than for retailing across the current and expected metrics. The month-to-month degradation for the current readings ranges from 7 points to 17 points weaker while the reading degradation monthly ranges from 5 points to 16 points. Wholesale sales and orders compared to a year ago and sales for the time of year each rank below the 5% mark. The expectations for January shows expectations for the three categories each are at a 2.5 percentile standing or lower. 

**Summing up**
The distributive trades survey has all but crashed and burned in December. Over the last 26 years the average of the three current metrics’ rankings has been lower only 18 times. The average outlook ranking for the month ahead has been weaker only 5 times in the last 26 years (over 313 months). On a relative basis the expected sales/orders performance is more depressed than the Current results for January. The pooled rankings show current ranking over the past 26-years weaker only 5.8 percent of the time with expectations lower only 1.6 percent of the time. These are very weak metrics. It is surprising that the BOE is walking on eggshells to cut rates with mixed support for rate cuts amid such weakness. There is already a GDP decline in the monthly data for October. UK and inflation is still too high, but it is breaking lower at a relatively fast pace. Will the UK be the first economy down after Covid? 




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United Kingdom

CBI’s Distributive Trades Survey Weakens Sharply in December

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Belgian consumer confidence has been on the rise since early this year, however, in December the index has taken a step backwards with a reading of -1 compared to a November reading of +2 and then an October reading of zero. The confidence indicator, on data back to 1991 has a ranking in its 78.5 percentile, marking it as a reasonably strong reading on confidence compared to its values over that period. On the whole the trend is still solid, the month’s step-back is small. 

**The Economic Situation** 
Economic situation for the next 12 months is weaker in December on a reading of -28 compared to -26 in November. The assessment of the previous 12-months is weaker in December at -42 compared to a reading of -38 in November. The outlook is weaker and the recent legacy is assessed as being slightly weaker as well, than it was in November. The assessment of the economic situation for the next 12 months is weak at a 9.7 percentile standing and the assessment of the previous 12 months is also weak at a 23.4 percentile standing.

**Price Trends**
Price trends are seen as higher over the next 12-months at a reading of 38 compared to 27 in November. The backward-looking assessment of price trends also has them stronger in December than 
in November at a reading of 58 compared to 56 in November. Both of these price trend assessments 
are high with the outlook reading at its 94th percentile and the backward-looking assessment in its 81st percentile. Price expectations hit their low mid 2023-late 2023 and have been on the rise steadily ever since. The price metric of ‘12-months ahead’ was at zero in April of 2024 but climbed to +19 by February 2025 and currently sits at a level of 38. Price expectations are well in gear to the upside in Belgium despite relative price stability in the Euro-Area. 

**Unemployment**
Concerns about unemployment elevated slightly in December to -9 from -10 in November but these are significant readings compared to, say, the 12-month-ago reading which is at a level of +32. The sense of backtracking here is extremely weak. The sense of progress on the part of survey respondents becoming more confident about the future is clearly the prevalent feature here. The December reading for unemployment in fact has only a 2.5 percentile standing, indicating extremely weak concerns about the prospects of unemployment ahead despite the minor month-to-month step-back.

**Major Household purchase environment**
The environment for making major household purchases deteriorates slightly in December at -15 compared to -13 in November. This only puts the index back to where it was in October. The response to the question, ‘is it favorable to buy at present’ is unchanged from its November value at -19 and it has been stuck there for three months in a row. The outlook to make major household purchases in the next 12-months logs a weaker reading at -15 than its 12-month value of -13but is stronger than its 12-month level of -18. The reading for the ‘favorable to buy at present’ question, however, is weaker at a -19 compared to -14, logged 12-months ago. The environment for making a household purchase over the next 12-months has a 55.6 percentile ranking which is above its median, however, the assessment of ‘favorable to buy at present’ has only a 20th percentile standing significantly below its median reading (median readings occur at a ranking of 50%)..

**The Financial situation**
The financial situation for the next 12-months is assessed weaker at -3 in December, compared to zero in November; it compares to a - 2 in October. The assessment 12-months ago was also -2 so this is a very minor deterioration comparing the financial situation of households with the last 12-months produces another deterioration at -8 in December compared to -6 in November and that compares to 12-months ago at -5 another deterioration. However, the backward-looking assessment has a 52-percentile standing which is above its median while the outlook reading of -3 has a 23-percentile standing which puts it in the lower quarter of all expectations on data back to 1991. The current situation is appraised at 20 a step-back from November and October levels as well as from 12-months ago. But the current appraisal also has a queue standing in its 65.7 percentile which has a comfortable margin above its median reading. Households clearly have concerns about their financial situation even though their outlook for making household purchases is above median and their concerns about unemployment are low. Currently, conditions appear to be construed as solid.

**Savings**
Household savings over the next 12-months are weaker in December at a reading of 20 compared to 26 in November; they are closer to their 12-month ago reading of 21. December is still a relatively high reading, in any event, with a 91-percentile standing. The question, ‘is it favorable to save at present’ is unchanged in November compared to December at a reading of -28 although it is weaker than it was 12-months ago and the percentile standing at its 78th percentile, again, a firm reading for this metric.

**Summing up - assessment** 
The consumer confidence reading from the Belgian National Bank this month shows a slight set back month-to-month, however, there is a significant an improvement that has been underway that is quite clear from the chart. The concerns that consumers have seemed to be about their financial situation haven't translated into concerns about unemployment or their willingness to make major household purchases, with unemployment concerns very low and their willingness to make household purchases for the period ahead at essentially normal levels. Still, there is more concern about inflation that is percolating, which is interesting considering that overall inflation has been relatively stable and muted in the European monetary area. 




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Belgium

Belgian Consumer Confidence - On the Rise, but Weaker Month-to-Month

Andrew Cates

**Faster-than-Expected Monetary Easing**
Our first potential upside risk for 2026 is that monetary policy across most major advanced economies is loosened further and by more than markets and forecasters currently anticipate. Monetary policy cycles have a history of being underestimated in both length and magnitude—in large part because of the powerful feedback loops between interest rates, inflation, and economic behaviour. On the way up, higher policy rates feed into mortgage costs, debt-service burdens, rents, and the general cost of doing business, reinforcing wage pressures and inflation persistence. But these same channels work in reverse on the way down. As rates fall, debt servicing eases, housing and rental inflation softens, and cost pressures across the economy unwind more rapidly than expected—allowing inflation to decelerate faster and creating scope for further easing. A risk, therefore, is that if disinflation becomes self-reinforcing, central banks find themselves cutting rates more aggressively than currently priced, not because of economic distress, but because restrictive policy proves increasingly unnecessary.

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**Energy Supply Dynamics Prove More Supportive**
The second chart reinforces the message from the first: easing monetary policy may be accompanied—and amplified—by a more benign energy backdrop. Recent projections from the EIA point to a renewed build-up in OECD crude oil and liquids inventories over the year ahead, a dynamic that has historically been associated with downward pressure on oil prices. If inventories continue to rise as supply growth outpaces demand, spot prices for crude could undershoot current forecasts, keeping energy inflation subdued. That, in turn, would reinforce disinflationary forces already in play—lowering headline CPI, easing cost pressures for firms and households, and giving central banks greater confidence to loosen policy further. In that sense, softer oil prices would not just be a standalone positive shock, but part of a reinforcing feedback loop alongside rate cuts, supporting real incomes, financial conditions, and global growth into 2026.


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**AI-Driven Productivity Gains Materialise More Quickly** 
The third chart shows a clear pickup in US nonfinancial productivity growth, reviving the debate around whether AI-driven efficiency gains may arrive sooner than many forecasters expect. While the longer-term productivity potential of AI remains uncertain and uneven across sectors, there are reasons to think that at least some near-term gains could prove more tangible than currently assumed. Rather than transformative breakthroughs, early benefits are likely to come from incremental improvements—automation of routine processes, better scheduling and logistics, more efficient use of capital and labour, and modest reductions in overhead costs—areas where US firms are already well positioned to implement new technologies quickly. If these gains accumulate and diffuse more broadly, the implications would still be meaningful. Even a modest, sustained uplift in productivity would help contain unit labour costs, support real income growth, and raise the economy’s speed limit without generating renewed inflation pressure. In that scenario, productivity would not need to “revolutionise” the economy to matter: incremental efficiency gains could nonetheless provide a supportive backdrop for growth, earnings, and policy easing into 2026—representing a genuine upside risk to the outlook.


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**The US Economy Proves Resilient Again**
The next chart highlights a further upside risk to the 2026 outlook: the possibility that the US economy once again outperforms its peers. Unlike the typical pre-recession backdrop, there is little evidence of meaningful financial stress in the US private sector. After a prolonged period of balance-sheet repair, private-sector debt ratios have been trending lower in recent years, while the sector as a whole is running a healthy financial surplus. This stands in stark contrast to previous late-cycle episodes, which were characterised by rising leverage, widening deficits, and growing dependence on credit expansion. The absence of private-sector excesses reduces the economy’s vulnerability to higher rates and external shocks, and helps explain why growth has remained more durable than expected. If households and firms continue to prioritise balance-sheet strength rather than forced deleveraging, the usual mechanisms that tip the economy into recession may fail to materialise. In that environment, even modest easing in financial conditions could translate into renewed spending and investment, allowing the US to sustain above-trend growth into 2026—representing another upside risk to the global outlook.


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**India’s Growth Engine Accelerates Further** 
Chart 5 points to another potential upside risk for 2026 emanating from India’s economy. After a period of relative pessimism earlier in the year, consensus growth forecasts for 2026 have been revised modestly higher, even as inflation projections have continued to drift lower. This combination—firmer growth expectations alongside easing inflation pressures—creates scope for a more supportive policy backdrop than markets currently assume. With real interest rates no longer rising and financial conditions stabilising, India’s investment cycle, already underpinned by public infrastructure spending and improving corporate balance sheets, could prove more durable than forecast. If these trends persist, India may deliver growth that is both stronger and more internally driven than expected, providing a meaningful demand impulse to the broader global economy. Given India’s increasing weight in global growth, even small upside surprises would have outsized effects on trade, commodity demand, and regional activity—reinforcing the case that the global outlook for 2026 may be skewed to the upside.


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**The Global South Becomes a More Independent Source of Demand** 
The final chart points to a broader upside risk for the global economy in 2026: that economies across the so-called Global South generate more durable momentum than currently assumed. With a few notable exceptions—such as China and Thailand—many emerging economies continue to benefit from stronger growth in their working-age populations and/or faster real GDP per capita growth than their advanced-economy counterparts. These demographic and income dynamics are helping to underpin domestic consumption, support labour-force expansion, and attract capital inflows, as reflected in the pattern of net FDI across countries. In contrast, much of the advanced world faces binding demographic constraints and lower steady-state growth rates, limiting the scope for demand to re-accelerate organically. If growth in the Global South proves more resilient and internally driven—rather than overly dependent on exports to advanced economies—it could provide a more stable and geographically diversified source of global demand. In that scenario, global growth in 2026 would be less reliant on a narrow set of advanced economies, reinforcing the case that risks to the outlook may be skewed to the upside.


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_This marks our final Charts of the Week publication for 2025 The next edition will be released on Thursday 8 January._

Last week’s Charts of the Week focused on the darker tail risks hanging over the 2026 outlook: the possibility of monetary policy mis-calibration, that geopolitics and trade fragmentation further disrupt supply chains, and that elevated debt levels—particularly in the public sector—reassert themselves as a drag on growth. This week’s charts take a deliberately different tack. Taken together, they highlight a set of upside risks that are possibly underappreciated in current forecasts. For example, policy easing across advanced economies may extend further than expected as disinflation feeds on itself (chart 1); oil prices could surprise on the downside as inventories rebuild (chart 2); US productivity may deliver incremental but meaningful gains sooner than assumed (chart 3); the US economy itself could continue to benefit from an absence of private-sector financial stress (chart 4); India’s growth momentum might firm again as inflation pressures recede (chart 5); and, more broadly, parts of the Global South appear increasingly capable of generating their own demand impulse, supported by favourable demographics and income growth (chart 6). None of these forces is guaranteed, and each carries its own caveats—but together they suggest that, having spent much of the past year fixated on downside risks, the risks to global growth in 2026 may be more evenly balanced than is widely assumed.

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Economy in Brief: 2005

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Chain Store Sales Up

Declines in the Euro and the Price of Oil Improve the Euro Zone Balance of Trade in Goods

Leading Economic Indicators Recovered

Leading Economic Indicators Recovered

State Coincident Indexes Highlight Regional Differences in Economic Activity

State Coincident Indexes Highlight Regional Differences in Economic Activity

Mexico's GDP Expands 3.3% in Q3: Is This Good or Bad?

Initial Claims for Jobless Insurance Lowest Since April