- Import prices drift higher in January, as a jump in petroleum prices offset cooling in the auto sector.
- Oil prices also led the increase on the export side.
USA| Feb 14 2025Oil Prices Leave High-Side Readings on Import and Export Prices
Global| Feb 13 2025Charts of the Week: Still Shining in the West
Recent weeks have brought significant shifts in financial market sentiment, reflecting changes in consensus views about the global economy. The latest Blue Chip Economic Indicators survey highlights the United States as a standout performer, with forecasters maintaining resilient growth forecasts compared to the rest of the world (chart 1). However, escalating concerns over US trade policy have led to sharp downward revisions in growth expectations for large open economies such as South Korea in recent months (chart 2). Inflation pressures also remain a key concern, which may have been amplified by the firmer-than-expected January US CPI data that were published this week (chart 3). CPI forecasts for most major economies, for example, have generally been climbing in recent months (chart 4). A notable exception is China, where inflation forecasts have continued to decline, and to worryingly low levels. Meanwhile, with Fed Chair Powell also signalling this week that the US central bank is in no hurry to cut interest rates, interest rate differentials remain a delicate balancing act for policymakers in many economies, particularly in Asia (chart 6). Recent financial market volatility certainly underscores the fine line central banks must tread as they navigate global economic uncertainties, including protectionist US trade policies and the ripple effects of shifting US monetary policy.
by:Andrew Cates
|in:Economy in Brief
USA| Feb 13 2025U.S. PPI Total & Core Increases Remain Firm in January
- Energy costs drive overall price increase.
- Core goods price gains are minimal.
- Services price gains are solid.
by:Tom Moeller
|in:Economy in Brief
- Initial claims hold tight range.
- Total beneficiaries decreased in February 1 week.
- Insured unemployment rate remains at 1.2%.
- Personal income tax receipts pick up.
- Outlay growth remains strong.
by:Tom Moeller
|in:Economy in Brief
USA| Feb 12 2025U.S. Consumer Price Inflation Strengthens in January
- Monthly core price gain doubles December rise.
- Goods & services prices both strengthen.
- Energy prices jump while food increase picks up.
by:Tom Moeller
|in:Economy in Brief
USA| Feb 12 2025U.S. Mortgage Applications Rose in the February 7 Week
- Purchase loan applications fell while refinancing loan applications jumped in the latest week.
- Effective interest rates on 30-year fixed-rate loans edged down.
- Average loan size rose to the highest since the October 4 week.
Italy| Feb 12 2025Italian IP Finds the Edge of the Earth…and Falls Off
OK…the earth is not flat. No one is falling off ‘the edge.’ But the decline in Italian IP across sectors is abrupt and the fall is sharp as though it has fallen into some sort of abyss. The chart is very telling. The table is too. The table is ‘coded’ with negative values in red except for ranking data where values are red when they are below their respective medians (below 50%). Among 45 categories in the IP portion of the table, only four are positive! In the lower portion of the table, the indicators and their standings show 27 observations of which four are not negative and among those four, three are zero. None of this is reassuring. Italy is experiencing some sudden broad weakness after having shown a good degree of resiliency. Manufacturing IP as well as two of its three main sectors – as well as transportation- show ongoing decelerating trends.
There is little here to equivocate on. Everything is weak and most categories are showing sequential worsening. Quarter-to-date growth rates for IP or changes in the indicators are negative everywhere except for manufacturing IP. Compared to the January 2020 level of IP categories or of survey values, all observations are weaker than their levels of five years ago. That is almost breath-taking. That’s half a decade.
Ranking data are largely at or below their 25th ranking percentile. Six of the eight categories show rank percentile standings below their 15th percentile.
Outlook/assessment Much of Italy’s weakness is new. Since January 2020, IP is lower by 10%, but over the last 12 months it is down by 8.4% - that is the bulk of that net drop. Transportation output is down by 13.7% since January 2020 and by 19.4% over the last 12 months. Indicators show the EU index for the industrial sector in Italy lower by 4 points from January 2020 and down by 1.7 point over 12 months. Italy’s ISTAT index has fallen 5 points over 12 months and the bulk of its 6-point drop since January 2020. The ISTAT outlook for production is down by 2 points over 12 months and lower by 7 points since January 2020. On balance, Italy’s industrial sector is looking extremely weak. It seems to be under new and severe downward pressures. At a time of global weakness and ongoing manufacturing weakness, this remains a sector to watch closely.
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