- Crude oil prices reach four-month high.
- Gain in metals price paced by zinc.
- Rubber & lumber costs continue to rise.
- Textile prices decline.
USA| Mar 22 2024FIBER: Industrial Commodity Prices Increase
by:Tom Moeller
|in:Economy in Brief
Germany| Mar 22 2024IFO Shows Some Sharp Monthly Improvement
The German IFO survey made some significant improvements in March compared to February. The all-sector climate reading grows to -16.1 in March from -23.5 in February. The current conditions index registered a positive 0.6 reading in March after a -1.9 rating in February. The expectations index rose to -16.4 in March from -23.0 in February.
There are some substantial changes and improvements in the month-to-month readings; however, make no mistake about it, the IFO remains very weak. The climate reading, for example, has a rank standing in March at its 19.1 percentile compared to a ranking in at the 6.5 percentile in February. The all-sector current conditions ranking moves up to 13.9 percentile in March from the 11.7 percentile in February. All-sector expectations move up to the 13.4 percentile from the 3.9 percentile in February. These are substantial and significant moves in the month-to-month rankings and for the month-to-month diffusion readings; however, the current readings are still weak. In terms of the values reported last month, the current readings aren't really going to be pointing to an economy that's substantially changed from the readings that we saw a month ago.
However, what's new and what's interesting is there is a month-to-month improvement and it's the first one of some significant value that we've seen in some time and that could mark a turning point. The change is most substantial for expectations, which is also a relatively volatile category and something to keep an eye on. But it's the fact of having an improvement after such a long period of conditions remaining weak that is both impressive and hopeful.
Looking at the various sectors in climate section, construction has the strongest ranking in its 25th percentile - a bottom quartile ranking.
Under current conditions, retail and construction have above-50 percentile standings- above their historic medians. The service sector has the weakest stand-alone ranking in its 15.6 percentile.
Expectations readings show a still-weak 0.8 percentile standing for construction, just off the all-time low made last month. The service sector, with a 15.1 percentile standing, is the strongest ranking sector in expectations.
Global| Mar 21 2024Charts of the Week: Up, Down, and Somewhere in Between
The decisions from several central banks this week have, on the whole, amplified hopes that the world economy remains on course for a soft landing. Equity investors were certainly reassured by the absence of big changes to the Fed's interest rate outlook, despite some concerns following last week’s US inflation surprises. This week’s unexpected decision by the Swiss National Bank (SNB) to cut interest rates by 25bps, in the meantime, chimed with the idea that a global easing cycle has now commenced. In the other direction, moreover, the Bank of Japan’s cautious move toward policy normalization met with a muted financial market response, possibly because it was softened by some dovish communications. In our charts this week we assess some of these financial market reactions (in charts 1 and 2), we review recent global inflation trends (in chart 3), and we then examine China's credit growth (chart 4), and its possible impact on other Asian economies (in chart 5). Finally, we assess 2023's equity market inflows in a selection of major economies, as a prelude to a forthcoming webinar with EPFR.
by:Andrew Cates
|in:Economy in Brief
USA| Mar 21 2024U.S. Existing Home Sales Surge in February
- Sales rise to twelve-month high.
- Home prices edge higher after seven straight monthly declines.
- Sales increase across the country, except Northeast.
by:Tom Moeller
|in:Economy in Brief
USA| Mar 21 2024U.S. Leading Economic Index Edges Up in February, the First M/M Increase in Two Years
- February LEI increases marginally following 23 straight m/m declines.
- Coincident Economic Index up for the seventh time in eight months.
- Lagging Economic Index up for the fourth time in five months.
- Headline index fell but unexpectedly remained in positive territory.
- First positive reading for new orders in five months; shipments continued to rise.
- However, employment continued to decline for fifth consecutive month.
- Six-month ahead expectations jumped to highest level since July 2021.
by:Sandy Batten
|in:Economy in Brief
USA| Mar 21 2024U.S. Current Account Deficit Eases Slightly in Q4
- Balance on goods widened a bit in Q4, while the services balance narrowed.
- Net primary income flows nearly offsetting, producing small change.
- Capital account mixed with net direct investment, but net sales of portfolio assets.
USA| Mar 21 2024U.S. Initial Unemployment Insurance Claims Dip
- Decline reverses prior week’s gain.
- Continuing claims rise to six-week high.
- Insured unemployment rate remains steady.
by:Tom Moeller
|in:Economy in Brief
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