Tom Moeller

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>

 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051025c.jpg" width="353">
In October, the Conference Board&#39;s index of Consumer Confidence fell to 85.0 and added 2.9% to the 17.9% m/m decline during the prior month.
Consensus expectations had been for little change at 88.0. Last week, the University of Michigan reported that its October measure of consumer sentiment fell 2.0% m/m (-17.8% y/y).
During the last twenty years there has been a 52% correlation between the level of consumer confidence and the y/y change in real consumer spending. The correlation rose to 66% during the last ten years.
The index of consumers&#39; expectations fell 3.9% m/m (-24.6% y/y) and the assessment of the present situation slipped 2.0% (+15.1% y/y). Jobs were viewed as hard to get by an increased 25.3% of survey participants.
The Conference Board&#146;s survey isconducted by a mailed questionnaire to 5,000 households and about 3,500 typically respond.

<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/USECON/@EF/@EF14/@EF1401/@EF1401.HTM">Conference Board</a></th>
<th scope="col">Oct</th>
<th scope="col">Sept</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">Consumer Confidence</td>
<td>85.0</td>
<td>87.5</td>
<td>-8.5%</td>
<td>96.1</td>
<td>79.8</td>
<td>96.6</td>
</tr>
</tbody>
</table>
U.S. Existing Home Sales Unchanged 
by <a href="/comment/Moeller.html">Tom Moeller</a> October 25, 2005


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051025b.jpg" width="353">
The National Association of Realtors reported that September total existing home sales remained unchanged from the prior month at 7.28M. The August level was revised down slightly. Consensus expectations had been for a slightly steeper decline to 7.20M sales. 
Sales of single-family homes rose 0.6% to 6.38 million while condo &amp; co-op sales fell 4.3% to 900,000 (+9.8% y/y). 
The data cover sales closed in the latest and previous months, and contrast to the new home sales data which count sales at the signing of a contract. 
By region, changes in single family home sales were mixed in September. In the Northeast sales rose by 1.2% (4.8% y/y) for the second consecutive month and rose 4.9% (12.6% y/y) in the South.In the West single family sales slipped 3.3% (+1.4% y/y) and have fallen in two of the last three months. In the Midwest sales fell 3.4% m/m but remained up 3.6% y/y. 
The median price of an existing single-family home fell 3.4% m/m to $212,200 (14.3% y/y). It was the second decline during the last three months.Prices are not seasonally adjusted and frequently soften following the peak Spring-Summer selling season. 
The latest release from the National Association of Realtors is available <a href="http://www.realtor.org/research.nsf/pages/EHSPage?OpenDocument">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/USECON/@E9/@E905/@E90501/@E90501.HTM">Existing Home Sales (000, AR)</a></th>
<th scope="col">Sept</th>
<th scope="col">Aug</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 class="odd">
<td class="firstcol">Total Home Sales</td>
<td>7,280</td>
<td>7,280</td>
<td>7.2%</td>
<td>6,723</td>
<td>6,170</td>
<td>5,653</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Single Family Home Sales</td>
<td>6,380</td>
<td>6,340</td>
<td>6.9%</td>
<td>5,913</td>
<td>5,441</td>
<td>4,995</td>
</tr>
<tr class="odd">
<td class="firstcol">Single Family Median Home Price ($,000) </td>
<td>$212.2 </td>
<td>$219.7 </td>
<td>14.3% </td>
<td>$182.8 </td>
<td>$169.1 </td>
<td>$157.6 </td>
</tr>
</tbody>
</table>
Chain Store Sales Slipped 
by <a href="/comment/Moeller.html">Tom Moeller</a> October 25, 2005


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051025d.jpg" width="353">
Chain store sales slipped 0.2% last week and reversed half of the prior week&#39;s increase, according to the International Council of Shopping Centers (ICSC)-UBS survey. For the month, the level of sales is even with the September average. 
During the last ten years there has been a 56% 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 jumped 0.9% (-2.3% y/y) during the latest week but for the month so far is down 0.1% from the September average.
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.

<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">10/22/05</th>
<th scope="col">10/15/05</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>449.7</td>
<td>450.6</td>
<td>3.6%</td>
<td>4.6%</td>
<td>2.9%</td>
</tr>
</tbody>
</table>
Gasoline Prices Fell Further 
by <a href="/comment/Moeller.html">Tom Moeller</a> October 25, 2005


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051025a.jpg" width="353">
The US average retail gasoline price continued lower last week and fell to $2.60 per gallon from $2.73 during the prior week.
Crude oil prices continued lower as well. WTI crude fell yesterday to $61.13 per barrel versus an average of $62.44 during last week and versus the late August high of $69.82.
Deflation: Making Sure &quot;It&quot; Doesn&#39;t Happen Here, a 2002 speech made by Ben S. Bernanke can be found <a href="http://www.federalreserve.gov/boarddocs/speeches/2002/20021121/default.htm"> 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/daily/@D3/@D306/@D306.HTM">Energy Prices</a></th>
<th scope="col">10/24/05</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>$2.60</td>
<td>$1.79</td>
<td>28.1%</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>$61.13</td>
<td>$41.78</td>
<td>10.7%</td>
<td>$41.78</td>
<td>$32.78</td>
<td>$31.23</td>
</tr>
</tbody>
</table>
 Business Confidence Strengthens in the Euro Zone: German and Dutch Business Join the More Optimistic Groups  
by <a href="/comment/Curley.html">Louise Curley</a> October 25, 2005


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051025e.jpg" width="353">
The healthy October rises in German and Dutch measures of business confidence following yesterday&#39;s report of continued rising business confidence in France are beginning to suggest a pickup in economic activity within the Euro Zone.
Although the pessimists still outweigh the optimists in Germany, the excess of pessimists declined in October to 3.5% from 8.9% in September according to the IFO measure of confidence. In the Netherlands, the optimists who had exceeded the pessimists in September by 1.3% increased their excess over the pessimists to 4.3% in October. The percent balances of the optimists over the pessimists for both German and Dutch business are shown in the first chart.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051025f.jpg" width="353">
In appraising current economic conditions in Germany, businessmen have generally been more pessimistic than optimistic. In the entire history of the IFO confidence data, from January, 1991 to date, the only time when the balance of opinion on current conditions was positive was the period from January 1991 to March 1992 and the month of May 2000.In their expectations of conditions six month ahead, German businessmen have generally been more optimistic, but even here, the times when the optimists outweighed the pessimists have been few and the positive balances small. The second chart shows the history of the IFO&#39;s percent balances of opinion of German businessmen for current conditions and expectations of conditions six months ahead. Because of this apparent bias in the IFO data, it is more useful to look at the changes in the data rather than the absolute values. <img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051025g.jpg" width="353">
In the third chart we show the year-to-year changes in the appraisals of current conditions and expectations of conditions six month ahead. Here we see a marked increase in confidence in October both in current conditions and expectations for conditions six month ahead.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol">Business Confidence Indicators (% Balance)</th>
<th scope="col">Oct 05&nbsp;</th>
<th scope="col">Sep&nbsp; 05</th>
<th scope="col">Oct 04</th>
<th scope="col">M/M&nbsp; Dif</th>
<th scope="col">Y/Y Dif</th>
<th scope="col">2004 &nbsp; </th>
<th scope="col">2003 &nbsp;</th>
<th scope="col">2002&nbsp;&nbsp;</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Netherlands</td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td class="firstcol">&nbsp;Producers&#39; Confidence</td>
<td>4.3</td>
<td>1.3</td>
<td>1.1</td>
<td>3.0</td>
<td>3.2</td>
<td>-0.1</td>
<td>-5.6</td>
<td>-1.5</td>
</tr>
<tr class="odd">
<td class="firstcol">Germany IFO&nbsp;&nbsp;</td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td class="firstcol">&nbsp;Business Climate</td>
<td>-3.5</td>
<td>-8.9</td>
<td>-10.7</td>
<td>5.4</td>
<td>7.2</td>
<td>-9.6</td>
<td>-17.6</td>
<td>-22.0</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;Business Situation</td>
<td>-7.4</td>
<td>-12.1</td>
<td>-16.1</td>
<td>4.7</td>
<td>8.7</td>
<td>-17.0</td>
<td>-27.9</td>
<td>-34.0</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Business Expectations</td>
<td>0.5</td>
<td>-5.6</td>
<td>-5.2</td>
<td>6.1</td>
<td>5.7</td>
<td>-1.8</td>
<td>-6.5</td>
<td>-9.1</td>
</tr>
</tbody>
</table>


</html>

In October, the Conference Board's index of Consumer Confidence fell to 85.0 and added 2.9% to the 17.9% m/m decline during the prior month. Consensus expectations had been for little change at 88.0. Last week, the University of [...]

Consumer Confidence Down Again

Louise Curley

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051024c.jpg" width="353">
Business confidence in France has been improving since June of this year when the balance of opinion on the general outlook registered 24% more pessimists than optimists. According to data released today by the French Institute of Statistics and Economic Studies (INSEE), the excess of pessimists over optimists regarding the outlook among businessmen has declined to only 1% in October. Over the past five years, business opinion on the outlook has tended to be more pessimistic and more volatile than business opinion of actual trends in production as can be seen in the first chart. The various components of the overall view are shown in the table below.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051024b.jpg" width="353">
INSEE also publishes a composite indicator of business confidence. It is based on the balances of opinions on past production, personal production forecasts, inventories, total and foreign order book and demand and general production forecasts and is constructed in such a way that the series has an average of 100 and a standard deviation of 10. According to this measure, business confidence weakened from mid 2004 to April and May of this year and is currently improving. Since late 2001, however, French business confidence has been subdued, ranging much closer to the average than in the past, as can be seen in the second chart.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/FRANCE/@F09/@F09.HTM">French Business Confidence Indicators (% Balance)</a></th>
<th scope="col">Oct 05&nbsp;</th>
<th scope="col">Sep 05</th>
<th scope="col">Oct 04</th>
<th scope="col">M/M Dif</th>
<th scope="col">Y/Y Dif</th>
<th scope="col">2004 &nbsp; </th>
<th scope="col">2003 &nbsp;</th>
<th scope="col">2002&nbsp;&nbsp;</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">General Outlook</td>
<td>-1</td>
<td>-13</td>
<td>23</td>
<td>12</td>
<td>-24</td>
<td>5</td>
<td>-29</td>
<td>-22</td>
</tr>
<tr>
<td class="firstcol">Recent Production Trend</td>
<td>4</td>
<td>4</td>
<td>17</td>
<td>0</td>
<td>-13</td>
<td>12</td>
<td>-8</td>
<td>-8</td>
</tr>
<tr class="odd">
<td class="firstcol">Order Book and Demand</td>
<td>-14</td>
<td>-19</td>
<td>-12</td>
<td>5</td>
<td>-2</td>
<td>-15</td>
<td>-23</td>
<td>-18</td>
</tr>
<tr>
<td class="firstcol">Foreign Order Book and Demand</td>
<td>-8</td>
<td>-12</td>
<td>-8</td>
<td>4</td>
<td>0</td>
<td>-11</td>
<td>-20</td>
<td>-17</td>
</tr>
<tr class="odd">
<td class="firstcol">Inventories</td>
<td>13</td>
<td>13</td>
<td>6</td>
<td>0</td>
<td>7</td>
<td>8</td>
<td>10</td>
<td>13</td>
</tr>
<tr>
<td class="firstcol">Prices</td>
<td>-4</td>
<td>2</td>
<td>2</td>
<td>-6</td>
<td>-6</td>
<td>1</td>
<td>-7</td>
<td>-5</td>
</tr>
<tr class="odd">
<td class="firstcol">Composite Synthetic Indicator*</td>
<td>102</td>
<td>100</td>
<td>108</td>
<td>2.0%</td>
<td>-5.6%</td>
<td>105</td>
<td>95</td>
<td>97</td>
</tr>
</tbody>
</table>
</body>
</html>

Business confidence in France has been improving since June of this year when the balance of opinion on the general outlook registered 24% more pessimists than optimists. According to data released today by the French Institute of [...]

Some Improvement in French Business Confidence

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051024a.jpg" width="353">
The weekly leading index of the US economy published by the Economic Cycle Research Institute (ECRI) increased 0.7% last week and rose to a record high for the series. The gain followed no change during the prior week and w/w declines during much of September.
Despite the somewhat erratic performance recently, the six month growth rate of the leading index at 2.1% is near the middle of its recent range and is up from the low of -0.6% in early June.
During the last ten years there has been a 53% correlation between the change in the weekly leading index and US real GDP growth during the following quarter. The correlation has risen to 76% during the last five years.
Visit the <a href="http://www.businesscycle.com/">Economic Cycle Research Institute</a> for analysis of US and international business cycles.
Tax Reform Options in the Real World from the Brookings Institution is available <a href="http://www.brookings.edu/dybdocroot/views/papers/gale/200510.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">Economic Cycle Research Institute&nbsp;</th>
<th scope="col">10/14/05</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">Weekly Leading Index</td>
<td>135.9</td>
<td>132.5</td>
<td>2.9%</td>
<td>132.6</td>
<td>124.9</td>
<td>119.8</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; 6 Month Growth Rate</td>
<td>2.1%</td>
<td>1.6%</td>
<td>&nbsp;</td>
<td>4.2%</td>
<td>6.7%</td>
<td>1.1%</td>
</tr>
</tbody>
</table>
</body>
</html>

The weekly leading index of the US economy published by the Economic Cycle Research Institute (ECRI) increased 0.7% last week and rose to a record high for the series. The gain followed no change during the prior week and w/w declines [...]

ECRI Leading Index Reached a New High

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051024a.jpg" width="353">
The weekly leading index of the US economy published by the Economic Cycle Research Institute (ECRI) increased 0.7% last week and rose to a record high for the series. The gain followed no change during the prior week and w/w declines during much of September.
Despite the somewhat erratic performance recently, the six month growth rate of the leading index at 2.1% is near the middle of its recent range and is up from the low of -0.6% in early June.
During the last ten years there has been a 53% correlation between the change in the weekly leading index and US real GDP growth during the following quarter. The correlation has risen to 76% during the last five years.
Visit the <a href="http://www.businesscycle.com/">Economic Cycle Research Institute</a> for analysis of US and international business cycles.
Tax Reform Options in the Real World from the Brookings Institution is available <a href="http://www.brookings.edu/dybdocroot/views/papers/gale/200510.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">Economic Cycle Research Institute&nbsp;</th>
<th scope="col">10/14/05</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">Weekly Leading Index</td>
<td>135.9</td>
<td>132.5</td>
<td>2.9%</td>
<td>132.6</td>
<td>124.9</td>
<td>119.8</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; 6 Month Growth Rate</td>
<td>2.1%</td>
<td>1.6%</td>
<td>&nbsp;</td>
<td>4.2%</td>
<td>6.7%</td>
<td>1.1%</td>
</tr>
</tbody>
</table>
Some Improvement in French Business Confidence  
by <a href="/comment/Curley.html">Louise Curley</a> October 24, 2005


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051024c.jpg" width="353">
Business confidence in France has been improving since June of this year when the balance of opinion on the general outlook registered 24% more pessimists than optimists. According to data released today by the French Institute of Statistics and Economic Studies (INSEE), the excess of pessimists over optimists regarding the outlook among businessmen has declined to only 1% in October. Over the past five years, business opinion on the outlook has tended to be more pessimistic and more volatile than business opinion of actual trends in production as can be seen in the first chart. The various components of the overall view are shown in the table below.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051024b.jpg" width="353">
INSEE also publishes a composite indicator of business confidence. It is based on the balances of opinions on past production, personal production forecasts, inventories, total and foreign order book and demand and general production forecasts and is constructed in such a way that the series has an average of 100 and a standard deviation of 10. According to this measure, business confidence weakened from mid 2004 to April and May of this year and is currently improving. Since late 2001, however, French business confidence has been subdued, ranging much closer to the average than in the past, as can be seen in the second chart.

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/FRANCE/@F09/@F09.HTM">French Business Confidence Indicators (% Balance)</a></th>
<th scope="col">Oct 05&nbsp;</th>
<th scope="col">Sep 05</th>
<th scope="col">Oct 04</th>
<th scope="col">M/M Dif</th>
<th scope="col">Y/Y Dif</th>
<th scope="col">2004 &nbsp; </th>
<th scope="col">2003 &nbsp;</th>
<th scope="col">2002&nbsp;&nbsp;</th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">General Outlook</td>
<td>-1</td>
<td>-13</td>
<td>23</td>
<td>12</td>
<td>-24</td>
<td>5</td>
<td>-29</td>
<td>-22</td>
</tr>
<tr>
<td class="firstcol">Recent Production Trend</td>
<td>4</td>
<td>4</td>
<td>17</td>
<td>0</td>
<td>-13</td>
<td>12</td>
<td>-8</td>
<td>-8</td>
</tr>
<tr class="odd">
<td class="firstcol">Order Book and Demand</td>
<td>-14</td>
<td>-19</td>
<td>-12</td>
<td>5</td>
<td>-2</td>
<td>-15</td>
<td>-23</td>
<td>-18</td>
</tr>
<tr>
<td class="firstcol">Foreign Order Book and Demand</td>
<td>-8</td>
<td>-12</td>
<td>-8</td>
<td>4</td>
<td>0</td>
<td>-11</td>
<td>-20</td>
<td>-17</td>
</tr>
<tr class="odd">
<td class="firstcol">Inventories</td>
<td>13</td>
<td>13</td>
<td>6</td>
<td>0</td>
<td>7</td>
<td>8</td>
<td>10</td>
<td>13</td>
</tr>
<tr>
<td class="firstcol">Prices</td>
<td>-4</td>
<td>2</td>
<td>2</td>
<td>-6</td>
<td>-6</td>
<td>1</td>
<td>-7</td>
<td>-5</td>
</tr>
<tr class="odd">
<td class="firstcol">Composite Synthetic Indicator*</td>
<td>102</td>
<td>100</td>
<td>108</td>
<td>2.0%</td>
<td>-5.6%</td>
<td>105</td>
<td>95</td>
<td>97</td>
</tr>
</tbody>
</table>
</body>
</html>

Carol Stone, CBE

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051021c.jpg" width="353">
UK GDP grew 0.4% in Q3, according to Office of National Statistics &quot;Preliminary Estimate&quot;, following 0.5% in Q2. This early estimate is compiled from industrial production and other industry data. It shows that manufacturing gained 0.3% on the quarter, after Q2&#39;s 0.2% decrease. Services maintained their 0.6% quarterly pace for a third straight time. Mining, including oil and gas extraction, and utility output, both of which had been supports in Q2, fell by significant amounts in Q3, 6.7% and 1.8%, respectively.
The upturn in manufacturing was generated by a number of largely unrelated sectors. Wood products, petroleum output and electrical and optical equipment, for examples, all turned up after Q2 declines. Nonmetallic minerals stabilized after a steep decline and rubber and plastics have been virtually flat for about six months. Food and textiles fell in Q3 after rising in Q2. Thus, it&#39;s hard to characterize the performance of manufacturing as a whole and therefore to look for any sustaining force -- one direction or the other.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051021d.jpg" width="353">
Another sign of precariousness in these UK data comes from a look at the revisions for Q2 compared with its &quot;preliminary&quot; estimate. Three months ago, when we wrote about the Q2 preliminary report, we noted the support from the mining sector, but also that recent irregular downtrends there suggested that the 1.4% gain reported then might be transitory. Indeed. The growth there has now been revised to just 0.4% and the sector resumed a long-term contraction in this latest quarter. This change shouldn&#39;t be much of a surprise in this industry. But the broad manufacturing sector also seems to be subject to transitory forces. Already seen above to have a scattered performance reported so far for Q3, the sector experienced a notable revision of Q2 data. As seen in the table below, the &quot;preliminary&quot; Q2 report showed a 0.7% decline, which now has been recalculated at just 0.2%. This is a favorable revision, of course, but at the same time, it points out the skittishness in these data. The analysts at the UK Office of National Statistics include a warning in their press release about the preliminary GDP data, expressing their concern that users put too much store in the preliminary figures. Our examination here describes a couple of good reasons we might agree with that sentiment and suggests that caution is needed as business planners and investors apply them to decision-making and actions.

<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/UK/@U2/@U2.HTM">United Kingdom:</a></th>
<th scope="col">Q3 2005 &quot;Prel&quot;</th>
Q2 2005
<th scope="col">Year/Year</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">Latest</td>
<td>&quot;Prel&quot;</td>
</tr>
<tr>
<td class="firstcol">GDP</td>
<td>0.4</td>
<td>0.5</td>
<td>0.4</td>
<td>1.6</td>
<td>3.2</td>
<td>2.5</td>
<td>2.0</td>
</tr>
<tr class="odd">
<td class="firstcol">Manufacturing </td>
<td>0.3</td>
<td>-0.2</td>
<td>-0.7</td>
<td>-0.1</td>
<td>1.9</td>
<td>0.1</td>
<td>-3.1</td>
</tr>
<tr>
<td class="firstcol">Mining inc Oil Extraction</td>
<td>-6.8</td>
<td>0.4</td>
<td>1.4</td>
<td>-9.9</td>
<td>-8.0</td>
<td>-5.2</td>
<td>-0.3</td>
</tr>
<tr class="odd">
<td class="firstcol">Electricity, Gas &amp; Water Supply</td>
<td>-1.8</td>
<td>1.0</td>
<td>1.1</td>
<td>-2.8</td>
<td>2.2</td>
<td>1.1</td>
<td>-0.4</td>
</tr>
<tr>
<td class="firstcol">Services</td>
<td>0.6</td>
<td>0.6</td>
<td>0.6</td>
<td>2.2</td>
<td>3.7</td>
<td>2.7</td>
<td>2.7</td>
</tr>
</tbody>
</table>
</body>
</html>

UK GDP grew 0.4% in Q3, according to Office of National Statistics "Preliminary Estimate", following 0.5% in Q2. This early estimate is compiled from industrial production and other industry data. It shows that manufacturing gained [...]

UK GDP Rises 0.4%, Helped by Upturn in Manufacturing

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051021a.jpg" width="353">
As of last week the US average retail gasoline price fell to $2.73 per gallon, down 11.2% from the weekly high of $3.07 seen in early September. Moreover, yesterday&#39;s NY harbor spot price for regular unleaded gasoline was down twenty cents to $1.55 from the week previous, the lowest since July, and the seven day average price was off 21.6% from its high.
Father Guido Sarducci&#39;s axiom that in economics, all that matters is supply and demand is behind the recent price declines. US gasoline supplies have soared due to the surge in gasoline imports which have more than doubled versus last year. That has supplanted a shortfall in production which was limited by a sharp recovery last week to roughly -2% y/y. Demand, on the other hand, has responded to the higher prices and is down sharply, by roughly 8% versus the year ago level.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051021b.jpg" width="353">
Lower prices for crude oil have allowed for the gasoline price decline as WTI crude fell yesterday to $61.04 per barrel. That was off 13% from the late August high of $69.82.
The decline in wholesale natural gas prices has been limited versus the petroleum price declines. At $13.09/mmbtu yesterday and $13.42 last week, gas prices were off 13% from the daily high $15.00 one month ago, but trend prices remained elevated ahead of the Winter heating season.
Are Inflation Expectations Rising from the Ashes? from the Federal Reserve Bank of St. Louis can be found <a href="http://research.stlouisfed.org/publications/mt/20051101/cover.pdf"> here</a>.
For the latest Short Term Energy Outlook from the US Department of Energy click <a href="http://www.eia.doe.gov/emeu/steo/pub/contents.html">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/daily/@D3/@D306/@D306.HTM">Energy Prices</a></th>
<th scope="col">10/17/05</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 class="odd">
<td class="firstcol">US Retail Gasoline, Regular ($/Gal.)</td>
<td>$2.73</td>
<td>$1.79</td>
<td>33.9%</td>
<td>$1.85</td>
<td>$1.56</td>
<td>$1.35</td>
</tr>
<tr>
<td class="firstcol">Natural Gas, Henry Hub, LA ($/mmbtu)</td>
<td>$13.42</td>
<td>$6.35</td>
<td>139.6%</td>
<td>$5.89</td>
<td>$5.47</td>
<td>$3.35</td>
</tr>
<tr class="odd">
<td class="firstcol">Domestic Spot Market Price: West Texas Intermediate ($/Barrel)</td>
<td>$63.21</td>
<td>$41.78</td>
<td>18.6%</td>
<td>$41.78</td>
<td>$32.78</td>
<td>$31.23</td>
</tr>
</tbody>
</table>
</body>
</html>

As of last week the US average retail gasoline price fell to $2.73 per gallon, down 11.2% from the weekly high of $3.07 seen in early September. Moreover, yesterday's NY harbor spot price for regular unleaded gasoline was down twenty [...]

Petroleum Prices Down, And Going Lower?

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051021a.jpg" width="353">
As of last week the US average retail gasoline price fell to $2.73 per gallon, down 11.2% from the weekly high of $3.07 seen in early September. Moreover, yesterday&#39;s NY harbor spot price for regular unleaded gasoline was down twenty cents to $1.55 from the week previous, the lowest since July, and the seven day average price was off 21.6% from its high.
Father Guido Sarducci&#39;s axiom that in economics, all that matters is supply and demand is behind the recent price declines. US gasoline supplies have soared due to the surge in gasoline imports which have more than doubled versus last year. That has supplanted a shortfall in production which was limited by a sharp recovery last week to roughly -2% y/y. Demand, on the other hand, has responded to the higher prices and is down sharply, by roughly 8% versus the year ago level.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051021b.jpg" width="353">
Lower prices for crude oil have allowed for the gasoline price decline as WTI crude fell yesterday to $61.04 per barrel. That was off 13% from the late August high of $69.82.
The decline in wholesale natural gas prices has been limited versus the petroleum price declines. At $13.09/mmbtu yesterday and $13.42 last week, gas prices were off 13% from the daily high $15.00 one month ago, but trend prices remained elevated ahead of the Winter heating season.
Are Inflation Expectations Rising from the Ashes? from the Federal Reserve Bank of St. Louis can be found <a href="http://research.stlouisfed.org/publications/mt/20051101/cover.pdf"> here</a>.
For the latest Short Term Energy Outlook from the US Department of Energy click <a href="http://www.eia.doe.gov/emeu/steo/pub/contents.html">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/daily/@D3/@D306/@D306.HTM">Energy Prices</a></th>
<th scope="col">10/17/05</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 class="odd">
<td class="firstcol">US Retail Gasoline, Regular ($/Gal.)</td>
<td>$2.73</td>
<td>$1.79</td>
<td>33.9%</td>
<td>$1.85</td>
<td>$1.56</td>
<td>$1.35</td>
</tr>
<tr>
<td class="firstcol">Natural Gas, Henry Hub, LA ($/mmbtu)</td>
<td>$13.42</td>
<td>$6.35</td>
<td>139.6%</td>
<td>$5.89</td>
<td>$5.47</td>
<td>$3.35</td>
</tr>
<tr class="odd">
<td class="firstcol">Domestic Spot Market Price: West Texas Intermediate ($/Barrel)</td>
<td>$63.21</td>
<td>$41.78</td>
<td>18.6%</td>
<td>$41.78</td>
<td>$32.78</td>
<td>$31.23</td>
</tr>
</tbody>
</table>
UK GDP Rises 0.4%, Helped by Upturn in Manufacturing 
by <a href="/comment/Stone.html">Carol Stone</a> October 21, 2005


<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051021c.jpg" width="353">
UK GDP grew 0.4% in Q3, according to Office of National Statistics &quot;Preliminary Estimate&quot;, following 0.5% in Q2. This early estimate is compiled from industrial production and other industry data. It shows that manufacturing gained 0.3% on the quarter, after Q2&#39;s 0.2% decrease. Services maintained their 0.6% quarterly pace for a third straight time. Mining, including oil and gas extraction, and utility output, both of which had been supports in Q2, fell by significant amounts in Q3, 6.7% and 1.8%, respectively.
The upturn in manufacturing was generated by a number of largely unrelated sectors. Wood products, petroleum output and electrical and optical equipment, for examples, all turned up after Q2 declines. Nonmetallic minerals stabilized after a steep decline and rubber and plastics have been virtually flat for about six months. Food and textiles fell in Q3 after rising in Q2. Thus, it&#39;s hard to characterize the performance of manufacturing as a whole and therefore to look for any sustaining force -- one direction or the other.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051021d.jpg" width="353">
Another sign of precariousness in these UK data comes from a look at the revisions for Q2 compared with its &quot;preliminary&quot; estimate. Three months ago, when we wrote about the Q2 preliminary report, we noted the support from the mining sector, but also that recent irregular downtrends there suggested that the 1.4% gain reported then might be transitory. Indeed. The growth there has now been revised to just 0.4% and the sector resumed a long-term contraction in this latest quarter. This change shouldn&#39;t be much of a surprise in this industry. But the broad manufacturing sector also seems to be subject to transitory forces. Already seen above to have a scattered performance reported so far for Q3, the sector experienced a notable revision of Q2 data. As seen in the table below, the &quot;preliminary&quot; Q2 report showed a 0.7% decline, which now has been recalculated at just 0.2%. This is a favorable revision, of course, but at the same time, it points out the skittishness in these data. The analysts at the UK Office of National Statistics include a warning in their press release about the preliminary GDP data, expressing their concern that users put too much store in the preliminary figures. Our examination here describes a couple of good reasons we might agree with that sentiment and suggests that caution is needed as business planners and investors apply them to decision-making and actions.

<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/UK/@U2/@U2.HTM">United Kingdom:</a></th>
<th scope="col">Q3 2005 &quot;Prel&quot;</th>
Q2 2005
<th scope="col">Year/Year</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">Latest</td>
<td>&quot;Prel&quot;</td>
</tr>
<tr>
<td class="firstcol">GDP</td>
<td>0.4</td>
<td>0.5</td>
<td>0.4</td>
<td>1.6</td>
<td>3.2</td>
<td>2.5</td>
<td>2.0</td>
</tr>
<tr class="odd">
<td class="firstcol">Manufacturing </td>
<td>0.3</td>
<td>-0.2</td>
<td>-0.7</td>
<td>-0.1</td>
<td>1.9</td>
<td>0.1</td>
<td>-3.1</td>
</tr>
<tr>
<td class="firstcol">Mining inc Oil Extraction</td>
<td>-6.8</td>
<td>0.4</td>
<td>1.4</td>
<td>-9.9</td>
<td>-8.0</td>
<td>-5.2</td>
<td>-0.3</td>
</tr>
<tr class="odd">
<td class="firstcol">Electricity, Gas &amp; Water Supply</td>
<td>-1.8</td>
<td>1.0</td>
<td>1.1</td>
<td>-2.8</td>
<td>2.2</td>
<td>1.1</td>
<td>-0.4</td>
</tr>
<tr>
<td class="firstcol">Services</td>
<td>0.6</td>
<td>0.6</td>
<td>0.6</td>
<td>2.2</td>
<td>3.7</td>
<td>2.7</td>
<td>2.7</td>
</tr>
</tbody>
</table>
</body>
</html>

<html>
<head>
<style>
.odd{
 background-color:#edf5ff;
}
.even{
 background-color:#dde5ef;
}
.grey1{
	background-color:#f0f0f0;
}
.grey2{
	background-color:#e2e2e2;
}
.grey3{
	background-color:#d4d4d4;
}
.grey4{
	background-color:#c6c6c6;
}
.grey5{
	background-color:#b8b8b8;
}
</style>
</head>
<body>
 



<img align="left" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051020d.jpg" width="353">
Italian consumer confidence improved noticeably for October, but people also have a more uncertain inflation outlook. The overall confidence index, calculated by ISAE, the Institute for Studies and Economic Analysis, rose 2.4 points from September to 105.3, the highest in a year. Components covering sentiment about the &quot;general&quot; situation and the &quot;future&quot; situation were both up, by 3 and 4 points, respectively, in the month.
At the same time, several details of the survey appear more mixed than the broad indexes might suggest. Household finances are viewed modestly worse: the &quot;household financial situation&quot;, expressed as a favorable/unfavorable balance, is reported at -50 following -48 in September and -44 a year ago. Household budget conditions stand at +5, compared with +8 both a month and a year ago. However, financial expectations are marginally better, at -7 in October from -10 in September but -6 in October 2004. These mixed results imply that consumers are fairly unsure of their finances, but the small size of the moves indicate only hints of nervousness, not decisive moodswings.<img align="right" border="0" height="265" src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/051020e.jpg" width="353">
Expectations on inflation have changed more, perhaps driven by energy prices. The portion of consumers looking for prices to remain stable has fallen sharply in recent months, as seen in the table below: October&#39;s reading is 41% from 58% in October 2004. Offsets occurred in the groups looking for &quot;large&quot; increases, to 11% from 4%, and &quot;medium&quot; increases, to 21% from 15%. The number &quot;unsure&quot; of what they believe about inflation moved to 8% from 4%.
Consumers&#39; nervousness over their finances and relative uncertainty over inflation are accompanied by a more distinct deterioration in the unemployment outlook. 17% of respondents expect unemployment to rise &quot;sharply&quot; in the coming year, up from just 6% a year ago. Those looking for a &quot;slight&quot; increase ticked down one percentage point to 33% from 34%. Thus, those anticipating that unemployment will go up now constitute exactly half of the survey, from 40% last October. So some parts of this consumer survey may indicate that people are in better moods, but other aspects suggest developing worry and uncertainty over the two major bugaboos in any economy: inflation and unemployment. 

<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col></colgroup>
<thead>
<tr>
<th scope="col" class="firstcol"><a href="http://www.haverselect.com/dlx/ITALY/@I07/@I07.HTM">Italy ISAE Survey</a></th>
<th scope="col">Oct 2005</th>
<th scope="col">Sept 2005</th>
<th scope="col">Aug 2005</th>
<th scope="col">Oct 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">Overall Consumer Confidence, Index 1980 = 100, Seasonally Adjusted</td>
<td>105.3</td>
<td>102.9</td>
<td>100.9</td>
<td>101.1</td>
<td>101.4</td>
<td>106.2</td>
<td>115.8</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; General Situation</td>
<td>83.8</td>
<td>80.8</td>
<td>80.2</td>
<td>94.6</td>
<td>88.6</td>
<td>91.4</td>
<td>105.2</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Future Situation</td>
<td>101.8</td>
<td>97.8</td>
<td>97.0</td>
<td>104.3</td>
<td>100.8</td>
<td>107.2</td>
<td>113.4</td>
</tr>
<tr>
<td class="firstcol">Prices, Next 12 Mos: % Expecting Large Increase, Not Seasonally Adjusted</td>
<td>11</td>
<td>11</td>
<td>8</td>
<td>4</td>
<td>5</td>
<td>7</td>
<td>16</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Medium Increase</td>
<td>21</td>
<td>19</td>
<td>16</td>
<td>15</td>
<td>14</td>
<td>15</td>
<td>35</td>
</tr>
<tr>
<td class="firstcol">&nbsp;&nbsp; Smaller Increase</td>
<td>17</td>
<td>16</td>
<td>14</td>
<td>17</td>
<td>21</td>
<td>20</td>
<td>13</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp; Stable</td>
<td>41</td>
<td>45</td>
<td>52</td>
<td>58</td>
<td>54</td>
<td>51</td>
<td>31</td>
</tr>
</tbody>
</table>
</body>
</html>

Italian consumer confidence improved noticeably for October, but people also have a more uncertain inflation outlook. The overall confidence index, calculated by ISAE, the Institute for Studies and Economic Analysis, rose 2.4 points [...]

October Consumer Confidence Rises in Italy, But Nascent Inflation and Unemployment Concerns Raise Questions, Too

USD/EUR exchange rate uncoupling from interest rate differential

Widespread downgrading of 2025 GDP outlook

Trade and fiscal policy uncertainty has exploded with the new administration

Much lower US electricity costs gives it a competitive advantage

Wage growth slowing in the US and Euro area; elevated and sticky in the UK

Stagflation-lite: Blue Chip forecasts below-trend growth and elevated inflation

US policy gyrations boosting policy uncertainty worldwide

Expected tariff hikes have boosted inflation expectations

US and Japan ended 2024 on solid ground in contrast to Europe

US economy expected to outperform other major economies in 2025

Only modest evidence of AI-related surge in US productivity growth

Previous Trump tariffs fading. A boost from new tariffs ahead?

Heavy US manufacturing states underperforming while Sun Belt states outperforming

Rising long-term yields a global phenomenon

US financial market concerns shifting from growth to inflation

Economic activity is picking up in the US but remains lackluster abroad

Policy uncertainty has surged since the US national elections.

Recent turnaround in US economic surprises leading to increases in rate-cut expectations

The outlook has brightened in the US, while it has dimmed for other major economies

Headline US PCE inflation elevated by sticky services prices

US and global equity prices have recently diverged

US leading global upturn in economic surprises

Blue Chip forecasters look for further significant monetary easing apart from Japan

Recent rise in global supply chain pressures could augur a pickup in global inflation pressures

Underperforming German economy generating increased policy uncertainty relative to Europe and the US

Our global data offering is unparalleled in terms of coverage, quality, and organization. We offer 290+ databases from 2500 government and private sources, a wealth of key survey and forecast data covering the world’s economies, and a robust offering of archive databases that drive machine learning for big data applications.

Optimized for precision analytics, our data is seamlessly integrated with Microsoft Office and all leading statistical packages through our DLX® software and platform independent HaverView™ website. We further offer direct database feeds, client server or cloud-based delivery, and RESTful API.


Privacy Policy

Disclaimer

Contact us

A premier time series data platform for the global strategy, research, and quant communities. 

New York

London

Singapore

Tokyo

Economy in Brief

Viewpoints

Contact Us

Our Data

Our Products

What We Do

Our Authors

About Us

Data News

Resources

Release Calendars

Training Center

Webinars

Newsletters

Download Software

For Clients

Live Updates

Andrew Cates

**China-US shipping activity** 
The economic fallout from escalating US-China trade tensions is becoming increasingly visible in the data. A clear example is the chart below, which highlights a sharp drop in vessel arrivals at the ports of Los Angeles and Long Beach, along with a notable decline in ships waiting offshore. These trends point to a tangible weakening in bilateral trade flows, as the effects of tit-for-tat tariffs imposed by both countries begin to bite. Given the outsized role the US and China play in global commerce, this slowdown is likely to reverberate through global supply chains, weighing on trade volumes, dampening demand, and curbing economic growth worldwide.

250501Z1.jpg

**GDP growth in Q1**
Data this week showed that the US economy contracted, albeit modestly, in Q1 even as the euro area recorded a modest expansion—an unusual divergence. The contraction in US GDP can be largely attributed to a sharp increase in imports, as firms rushed to front-load purchases ahead of anticipated tariff hikes. In addition, domestic demand was subdued, with weaker contributions from both consumer spending and government consumption. This decoupling between the US and euro area economies is particularly striking given the current global focus on the US dollar. While the euro area has shown unexpected signs of resilience, the US downturn raises important questions about its underlying momentum, especially as trade dynamics and policy uncertainty continue to cloud the outlook.

250501Z2.jpg

**The US dollar versus yield differentials**
Chart 3 below illustrates a sharp breakdown in the correlation between the US-Germany 10-year yield differential and the EUR/USD exchange rate. Historically, the dollar has moved closely with interest rate spreads, as yield-seeking capital flowed into US assets. But since early 2025—and more acutely following the April tariff actions—the dollar has weakened markedly even as the yield spread has narrowed only modestly. This decoupling underscores a critical shift: capital markets are reacting not just to monetary policy, but to rising trade and geopolitical uncertainty. In other words, the exchange rate is now being driven as much by risk sentiment as by interest rate arbitrage.

250501Z3.jpg

**The US economy’s structural outperformance and the dollar**
A second dynamic, captured in the next chart, reveals a tight correlation between the US real effective exchange rate and the potential GDP growth differential between the US and euro area over the past 50-60 years. This raises the question: has dollar strength (until recently) merely been a reflection of US growth leadership—or are capital inflows themselves helping to sustain this growth outperformance? In effect, the tail may be wagging the dog. Global investors have long allocated capital to the US, attracted by its macroeconomic resilience, technological leadership, and deep, liquid financial markets. The danger now is that the US trade war may disrupt this equilibrium. A sharp or sustained reduction in capital inflows could undermine growth, weaken the dollar, and trigger broader financial instability. Moreover, reversing this dynamic is not straightforward—barring a credible structural resurgence in European (or Asian) growth, the global investment landscape remains tilted toward the US.

250501Z4.jpg

**US competitiveness versus Europe, China and Japan** 
The next chart below examines relative unit labour costs across major economies since 2011. The US and China have seen a broadly similar trajectory, with steady increases in relative cost structures, while the euro area has remained flat and Japan has seen dramatic improvement. This suggests that, from a cost competitiveness standpoint, the US is not uniquely disadvantaged vis-à-vis China. However, as we discuss further below, this parallel erosion of cost competitiveness is occurring at much higher nominal wage levels in the US, which blunts its ability to regain export share through tariff-related shifts alone. The trade war strategy—absent a corresponding improvement in productivity or structural reforms—risks imposing costs without delivering material competitiveness gains.

250501Z5.jpg

**Average wages in selected developed and developing economies**
This point is reinforced by the final chart, which shows estimates for average monthly wages across countries in 2024. US labour remains much more expensive than in peer or emerging economies. So even if China’s costs rise in tandem with the US, the global supply chain has ample alternatives. 'China plus one' strategies are accelerating, and the US remains structurally misaligned with low-cost production hubs. Tariffs aimed at reshoring supply chains are unlikely to deliver sustained gains unless accompanied by deep supply-side reforms, and risk further disincentivizing foreign direct investment if global firms perceive US trade policy as erratic or punitive.

250501Z6.jpg

Financial markets found a measure of calm this week, buoyed by some subtle shifts in tone from US policymakers. A softening in the administration’s rhetoric around trade tariffs coupled with a less confrontational stance toward Federal Reserve Chair Jerome Powell, helped ease tensions that had roiled markets earlier in the month. Equities rebounded modestly, and volatility indicators edged lower, reflecting cautious optimism that the worst of the policy shocks may be behind us. But beneath the surface, significant downside risks persist. New shipping data point to a pronounced slowdown in US-China trade flows (chart 1), suggesting the damage from recent tariff escalations is already rippling through global supply chains. Meanwhile, incoming data for the US revealed an unexpected contraction in the economy in Q1 and further signs of weakness in the labour market (chart 2). The US dollar, in the meantime, while long supported by superior growth and yield differentials, has begun to decouple from traditional drivers (charts 3 and 4) suggesting growing pressure on capital flows. At the same time, structural imbalances are drawing renewed scrutiny: unit labour cost comparisons show the US steadily losing competitiveness (chart 5), while nominal wage disparities remain stark versus China and other Asian economies, further complicating any effort to restore trade balance without broader reforms (chart 6). In short, while markets may be drawing temporary comfort from a pause in tariff brinkmanship, the deeper economic and financial vulnerabilities exposed this month remain unresolved—and increasingly central to the global macro narrative.

<iframe style="border-radius:12px" src="https://open.spotify.com/embed/episode/3PzXXKrkHcwtOLipohEdnB?utm_source=generator" width="100%" height="152" frameBorder="0" allowfullscreen="" allow="autoplay; clipboard-write; encrypted-media; fullscreen; picture-in-picture" loading="lazy"></iframe>

Charts of the Week: Tariff Truce, Tenuous Trust

250430N1.jpg

250430O1.jpg

Real GDP eased 0.3% SAAR (+2.1% y/y) during the first quarter of 2025 after increasing 2.4% in Q4’24 and 3.1% in Q3’24. A 0.4% increase had been expected in the Action Economics Forecast Survey. It was the first decline since Q1 2022.

Foreign trade subtracted 4.83 percentage points from growth last quarter as imports surged 41.3% (13.4% y/y) ahead of tariffs, which began to come into effect in the first quarter. The rise followed a 1.9% decline in Q4’24. Exports rose 1.8% (3.0% y/y) after easing 0.2% in Q4. Inventories added 2.25 percentage points to growth after subtracting 0.84 percentage point from Q4 growth.

Real final sales to domestic purchasers grew 2.3% (2.9% y/y) in Q1 after rising 3.0% in Q4. Personal consumption expenditures rose 1.8% (3.1% y/y) following a 4.0% gain. Durable goods spending fell 3.4% (+5.3% y/y) after surging 12.4% in Q4. Motor vehicle purchases declined 11.1% (+5.5% y/y) after strengthening 19.7% in Q4. Spending on home furnishings & appliances gained 1.5% (6.1% y/y) following a 5.4% rise. Recreational goods & vehicle outlays rose 2.5% (7.0% y/y) last quarter after a 13.9% Q4 increase.

Nondurable goods outlays rose 2.7% (3.0% y/y) following 3.1% growth in Q4. Apparel spending increased 6.7% (2.5% y/y) following a 5.0% rise. Food & beverage buying gained 2.5% (2.3% y/y) after a 1.8% increase. Gasoline & fuel oil purchases increased 4.6% (3.4% y/y) after falling 2.0% in Q4.

Spending on services increased 2.4% last quarter (2.7% y/y) after a 3.0% gain. Outlays on housing & utilities increased 3.4% (1.8% y/y) after rising 1.1% in Q4. Health care expenditures rose 4.0% (4.8% y/y) following a 4.7% strengthening. Transportation outlays increased 5.3% (4.6% y/y) after a 3.7% rise while recreation spending rose 4.7% (2.8% y/y) following a 4.5% rise. Restaurant & hotel expenditures declined 2.1% (+0.5% y/y) following a 2.8% rise. Financial services expenditures rose 1.9% (2.0% y/y) after a 3.1% Q4 increase.

Business fixed investment increased 9.8% (3.6% y/y) following a 3.0% decline in Q4. Expenditures on structures rose 0.4% (-0.4% y/y) after a 2.9% increase. Expenditures on producers’ durable equipment jumped 22.5% (8.0% y/y) after falling 8.7%.  Outlays on information processing equipment soared 69.3% (18.9% y/y) following a 7.3% decline. Industrial equipment investment fell 1.4% (-0.3% y/y) after easing 0.9%. Intellectual property product spending rose 4.1% (1.8% y/y) following a 0.5% decline. 

Residential structures investment increased 1.3% (-0.1% y/y) in Q1 after a 5.5% Q4 rise.

250430P1.jpg

250430Q1.jpg

Government spending fell 1.5% (+2.4% y/y) after a 3.1% Q4 rise. Federal government expenditures declined 5.1% (+2.9% y/y) after rising 4.0% in Q4. National defense expenditures declined 8.0% (+4.0% y/y) after increasing 4.8% in Q4. State & local government spending rose 0.8% (2.1% y/y) following a 2.5% rise.

The GDP price index rose 3.7% (2.6% y/y) after increasing 2.3% in Q4. It was the largest increase since Q4’22. A 2.4% increase had been expected. The PCE chain price index increased 3.6% (2.5% y/y) following a 2.4% rise. The PCE price index excluding food and energy rose 3.5% (2.8% y/y) after increasing 2.6% in Q4. The business fixed investment price index rose 0.4% (1.8% y/y) after 1.5% rise. The residential price index strengthened 3.9% (3.2% y/y) after a 1.9% rise while the government price index increased 4.7% (2.8% y/y) following a 2.1% rise.

The GDP data can be found in Haver’s **USECON** and **USNA** databases. **USNA** contains virtually all of the Bureau of Economic Analysis detail in the national accounts. The Action Economics consensus estimates can be found in **AS1REPNA**.

250430R1.jpg

250430S1.jpg

- Decline in GDP is first in three years.
- Foreign trade subtracts substantially ahead of tariffs.
- Domestic final demand growth weakens.
- Price index strengthens with higher core PCE prices.

U.S. GDP Unexpectedly Declines in Q1’25; Prices Strengthen

Michael J. Moran

250430A.jpg

250430B.jpg

High-side readings on the price indexes for personal consumption expenditures in January and February caused some concern about emerging price pressure, especially with some policies of the Trump administration possibly adding to the upward force. However, March brought notable relief, with the headline price index falling slightly (-0.04%). A marked decline in energy prices was helpful (-2.7%), but core prices also were subdued, increasing less than 0.1%.  Year-over-year changes were still above the Fed’s target of 2%, but only barely so for the headline measure (2.3%). The core index backed away from the reading of 3.0% in February, but the latest reading of 2.7% was in line with observations in the past year, and still uncomfortably above target.

Consumers roused from a winter slumber in March, with nominal outlays increasing 0.7%. With inflation restrained, real outlays also posted a gain of 0.7%. Spending on durable gods stood out, with real outlays advancing 3.2%. Real outlays for both nondurable goods and services rose 0.4%, a solid pace. Signs of life were certainly welcome after an average decline of 0.1% in January and February. The March rebound left growth of 1.8% (annual rate) in the first quarter.

The brisk increase in spending in March was supported by a solid gain in personal income (0.5% in both nominal and real terms). Growth in wage income was firm at 0.5%, while proprietors’ income was robust with a gain of 1.8% (not annualized!). The farm sector led the advance in proprietors’ income, but the nonfarm sector also was strong (0.6%).

The personal income and consumption figures are available in Haver’s **USECON** database with detail in the **USNA** database. The Action Economics forecasts are in **AS1REPNA**.

250430C.jpg

250430D.jpg

- Price pressure eases.
- Spending rebounds after two soft months.

Personal Income, Consumption, and Prices in March

250430F20.jpg

250430G20.jpg

The Pending Home Sales Index, a forward-looking home sales measure based on contract signings, from the National Association of Realtors rose 6.1% to 76.5 (-0.6% y/y) during March after rising a little-revised 2.1% in February. These changes followed a 4.6% January decline.

The rise in March sales occurred as the rate on a 30-year mortgage eased to an average 6.65% from 6.84% in February. This rate was well above a low of 2.68% averaged in December 2020.

Pending home sales were up in most regions of the country. Sales in the Midwest rose 4.9% (1.4% y/y) last month after rising 1.8% in February. Sales in the South increased 9.8% (-0.4% y/y) following a 5.8% February rise. Sales in the West improved 4.8% (-2.0% y/y) after falling 3.0% in February. Sales in the Northeast were off 0.5% (-3.0% y/y) in March after falling 0.9% in February.

The pending home sales index measures sales at the time the contract for the purchase of an existing home is signed, similar to the Census Bureau's new home sales data. In contrast, the National Association of Realtors' existing home sales data are recorded when the sale is closed, which is usually a couple of months after the sales contract has been signed. In developing the pending home sales index, the NAR found that the level of monthly sales contract activity leads the level of closed existing home sales by about two months.

The series dates back to 2001 and are available in Haver's **PREALTOR** database. Weekly mortgage interest rates from the Mortgage Bankers Association can be found in the **WEEKLY** database.

- Sales rise to highest level in four months.
- Strength is evident throughout most of country.

U.S. Pending Home Sales Surge in March

Sandy Batten

250430F5.jpg

250430G5.jpg

The employment cost index (ECI) for civilian workers, arguably the most accurate measure of labor compensation in the United States, rose 0.9% q/q (3.6% y/y) in Q1, the same quarterly increase as in last year’s Q4, according to the Bureau of Labor Statistics. The quarterly gains have fluctuated between 0.8% and 1.0% for the past six quarters. The Action Economics Forecast Survey had expected a 0.9% q/q increase and a 3.5% y/y gain.

Wages and salaries for civilian workers rose 0.8% q/q (3.5% y/y) in Q1, down from 1.0% q/q in Q4. This tied the Q3 2024 quarterly rise as the smallest increase since Q2 2021. It was also the smallest y/y increase since Q2 2021. Benefits increased by an outsized 1.2% q/q (3.9% y/y) in Q1 versus 0.8% q/q in Q4. This is the largest quarterly gain since Q2 2022. In general, employment cost gains remain above the pace observed prior to the pandemic but are slowing gradually.

Private industry workers’ compensation rose 0.8% q/q (3.4% y/y) in Q1, down from 0.9% q/q (3.6% y/y) in Q4. Wages and salaries for private industry workers increased 0.8% q/q (3.4% y/y) in Q1 versus 0.8% q/q (3.7% y/y) in Q4. The quarterly gain in Q1 tied that in Q3 2024 as the smallest increase since Q4 2020. Benefits for private industry workers jumped 1.2% q/q (3.6% y/y). the largest quarterly gain since Q2 2022. The acceleration in benefits in Q1 was primarily in service-producing industries.

Compensation in private goods-producing industries increased 1.0% q/q (3.2% y/y) in Q1, the largest quarterly gain in five quarters, versus a 0.7% q/q increase in Q4. Compensation in construction jumped 1.3% q/q, its largest quarterly increase since Q2 2022, up from a 0.6% q/q gain in Q4. Manufacturing compensation growth slowed to 0.7% q/q, its slowest quarterly advance since Q4 2020, from 0.8% q/q in Q4. Compensation in private service-producing industries increased 0.8% q/q (3.5% y/y), down slightly from a 0.9% q/q gain in Q4. Compensation in education and health services jumped 1.3% q/q, its largest quarterly gain since Q3 2023. In contrast, compensation in other services edged up 0.1% q/q in Q1, its smallest quarterly advance since before the pandemic.

The employment cost index measures the change in the cost of labor, free from the influence of employment shifts across occupations and industries. It is provided by the Bureau of Labor Statistics and is available in Haver’s **USECON** database. Consensus estimates from the Action Economics Forecast Survey are in Haver’s **AS1REPNA** database.

250430H5.jpg

250430I5.jpg

- Compensation grew 0.9 q/q in Q1, the same pace as in Q4.
- Wage growth slowed to 0.8% q/q while benefits surged 1.2% q/q, their largest quarterly increase since Q2 2022.

Economy in Brief: October 2005

Jump to:

Consumer Confidence Down Again

Some Improvement in French Business Confidence

ECRI Leading Index Reached a New High

ECRI Leading Index Reached a New High

UK GDP Rises 0.4%, Helped by Upturn in Manufacturing

Petroleum Prices Down, And Going Lower?

Petroleum Prices Down, And Going Lower?

October Consumer Confidence Rises in Italy, But Nascent Inflation and Unemployment Concerns Raise Questions, Too