Tom Moeller

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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>
<br>

<span id="articletext">
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100326a.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100326b.jpg" style="width: 312px; height: 265px;"></p>
<p>Last quarter was a strong one for the U.S. economy and the
revised picture is little different from the one depicted earlier. The
latest revision, however, lowered the growth rate slightly to 5.6% from
5.9%. Nevertheless, last quarter's growth remained the best since 3Q
2003 and it pushed the y/y change into (slightly) positive territory
for the first time since early-2008. The revision exceeded Consensus
expectations for 5.9% growth.</p>
<p> The addition to growth from inventories was notched down to
3.8 percentage points. The strength in rebuilding was necessitated by
vigorous and unprecedented decumulation dating back to 2005.</p>
<p>Growth in domestic final demand also was shaved to a still
slow 1.4% from 1.6%. Business investment in equipment &amp;
software was revised up slightly to 19.0% (-7.5% y/y) after a 1.5% 3Q
rise. Investment in business construction, however, offset much of this
increase with a 18.1% decline (-25.3% y/y) which was more than
estimated last month. Growth in residential investment also was revised
down to 3.7% (-12.6% y/y) though it remains the second consecutive
quarterly increase. Personal consumption growth was little revised at
1.6% (1.0% y/y) following a 2.8% 3Q increase. Finally, government
spending dropped an unrevised 1.3% (+1.3% y/y), led by a decline in
defense spending as well as lower spending by state and local
governments.</p>
<p>Improvement in the foreign trade deficit added an unrevised
0.3 percentage points to last quarter's gain in GDP. Strong growth in
exports of 22.8% (-0.7% y/y) was little changed. That surge was offset,
however, by a 15.8% (-6.6% y/y) jump in imports.</p>
<p>Price inflation was revised slightly higher to 0.5% as
measured by the chained GDP price index. Diminished price gains for all
of last year pulled the annual increase down to 1.2% which was nearly
its weakest increase since the early-1960s. The personal consumption
chain price index rose a quickened 2.1%. However, it increased just
0.2% for the whole year owing to the yearly decline in energy prices.
The price index for fixed business investment fell 1.4% (-2.9% y/y),
the fourth consecutive quarterly decline. A 2.7% increase (-2.6% y/y)
in the residential investment price index offset a 3Q decline.</p>
<p>Corporate profits rose 8.0% (30.6% y/y) last quarter. The gain
was driven by an 18.6% jump in financial sector earnings, which are up
more than three-fold during the last year due to lower interest rates.
Nonfinancial sector earnings benefitted from the economic recovery and
cost cutting. The 8.7% (11.5% y/y) increase was offset, however, by a
5.0% decline (-7.6% y/y) in repatriated foreign sector profits.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100326c.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100326d.jpg" style="width: 312px; height: 265px;">
<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/USECON/@E7/@E701/@E701.HTM"><b>Chained
2005$, % AR</b></a></th>
<th scope="col"><b>4Q '09&nbsp; Final</b></th>
<th scope="col"><b>4Q '09&nbsp; Preliminary</b></th>
<th scope="col"><b>4Q '09 <br>
Advance</b></th>
<th scope="col"><b>3Q '09</b></th>
<th scope="col"><b>4Q Y/Y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol"><b>GDP</b></td>
<td>5.6</td>
<td>5.9</td>
<td>5.7</td>
<td>2.2</td>
<td>0.1</td>
<td>-2.4</td>
<td>0.4</td>
<td>2.1</td>
</tr>
<tr>
<td class="firstcol"><b>&nbsp;&nbsp;Inventory
Effect</b></td>
<td>3.8</td>
<td>3.9</td>
<td>3.4</td>
<td>0.7</td>
<td>0.2</td>
<td>-0.7</td>
<td>-0.4</td>
<td>-0.4</td>
</tr>
<tr class="odd">
<td class="firstcol"><b>Final Sales</b></td>
<td>1.7</td>
<td>1.9</td>
<td>2.2</td>
<td>1.5</td>
<td>-0.1</td>
<td>-1.7</td>
<td>0.8</td>
<td>2.5</td>
</tr>
<tr>
<td class="firstcol"><b>&nbsp;&nbsp;Foreign
Trade Effect</b></td>
<td>0.3</td>
<td>0.3</td>
<td>0.5</td>
<td>-0.8</td>
<td>0.9</td>
<td>1.0</td>
<td>-1.2</td>
<td>0.8</td>
</tr>
<tr class="odd">
<td class="firstcol"><b>Domestic Final Demand</b></td>
<td>1.4</td>
<td>1.6</td>
<td>1.7</td>
<td>2.3</td>
<td>-1.0</td>
<td>-2.7</td>
<td>-0.4</td>
<td>1.7</td>
</tr>
<tr>
<td class="firstcol"><b>Chained GDP Price Index</b></td>
<td>0.5</td>
<td>0.4</td>
<td>0.6</td>
<td>0.4</td>
<td>0.7</td>
<td>1.2</td>
<td>2.1</td>
<td>2.9</td>
</tr>
</tbody>
</table>
<span id="articletitle">Italian Households Take Another
Step Back In Comfort Italian Consumer Confidence Turns The Corner, The
Wrong Corner</span><br>
<span id="byline">by <a href="/comment/Brusca.html">Robert
Brusca</a> March 26, 2010</span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100326e.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>Italian consumers used to feel better. They used to feel a lot
better just a few short months ago. In December of 2009 at a level of
113.6 Italy&#8217;s consumer confidence measure compiled by ISAE hit what is
for now its cycle high. That reading had barely surpassed the December
2006 confidence peak-reading of 113.4. But December 2009 stood as the
best reading since July 2002 and all seemed good. In retrospect,
Italy&#8217;s funk goes back to that late 2000 transitional period when
confidence dropped from very strong levels to begin its period of what
has been readings that have persisted at much lower levels. For Italy
it&#8217;s problems are not just the financial crisis and economic recovery.</p>
<p>Now it is clear that the bloom is off the consumer&#8217;s rose.
That rose seemed to bloom early and with all of Italy&#8217;s troubles it was
hard to tell what the real truth was. The truth appears to be that
Italy&#8217;s consumers were overly optimistic or actually in denial. Their
spirits are now deflating fast.</p>
<p>Italian consumers rate the past twelve months as better in
March than they did in February. But that was only a 61st percentile of
the range response. In March, looking to the more important next
12-months, the overall rating remains what is was in February but that
is a lower 34th percentile of range response. In other words the level
of the reading is nearly in the lower one-third of its range.
Expectations of unemployment are up and that reading is in the top 2%
of its range. Unemployment fears have really ratcheted up in Italy.
It&#8217;s possible that events in fellow Mediterranean country Greece are
having some chilling knock-on effects.</p>
<p>Despite these responses consumers rate their household
finances as one point improved over the next 12-months compared to last
month&#8217;s outlook reading; it&#8217;s a 36 range percentile assessment.
Households also rate current savings as high, in the top 7% of their
range, but future savings are rated in the bottom 25th percentile of
their range. But where the rubber hits the road and the spending
environment is assessed Italian consumers place the assessment right in
the middle at the 54th percentile of the range. Good time to spend?
Mezzo-mezzo.</p>
<p>There is a lot of confusion in Italy about where the country
is going and how fast. There is a lot of concern about unemployment.
Recent events in the e-Zone must have Italians worried; they can see
that if they slip-up there is no safety net that will be thrown under
them, maybe a blanket thrown over them after-the-fact. The thought is
chilling. Not even pasta can salve the pain.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="8" scope="col"><b>Italy ISAE
Consumer Confidence</b> </th>
</tr>
</thead>
<tbody>
<tr class="even">
<td class="firstcol">&nbsp;</td>
<td colspan="4">&nbsp;</td>
<td colspan="2">Since 1992</td>
<td>Rank</td>
</tr>
<tr class="even">
<td class="firstcol">&nbsp;</td>
<td>Mar-10</td>
<td>Feb-10</td>
<td>Jan-10</td>
<td>Dec-09</td>
<td>Percentile</td>
<td>Rank</td>
<td>percentile</td>
</tr>
<tr class="odd">
<td class="firstcol">Consumer Confidence</td>
<td>106.3</td>
<td>107.7</td>
<td>111.6</td>
<td>113.6</td>
<td>37.4</td>
<td>146</td>
<td>31.5%</td>
</tr>
<tr style="font-weight: bold;">
<td colspan="8" class="firstcol">Last 12
months</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; OVERALL
SITUATION</td>
<td>-63</td>
<td>-67</td>
<td>-54</td>
<td>-57</td>
<td>67.2</td>
<td>83</td>
<td>61.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; PRICE
TRENDS</td>
<td>-41.5</td>
<td>-45</td>
<td>-38</td>
<td>-41</td>
<td>12.6</td>
<td>206</td>
<td>3.3%</td>
</tr>
<tr style="font-weight: bold;">
<td colspan="8" class="firstcol">Next 12months</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; OVERALL
SITUATION</td>
<td>-14</td>
<td>-14</td>
<td>-1</td>
<td>-1</td>
<td>39.7</td>
<td>140</td>
<td>34.3%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; PRICE
TRENDS</td>
<td>17</td>
<td>16</td>
<td>11.5</td>
<td>8.5</td>
<td>39.5</td>
<td>48</td>
<td>77.5%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;
UNEMPLOYMENT</td>
<td>26</td>
<td>25</td>
<td>16</td>
<td>16</td>
<td>82.4</td>
<td>4</td>
<td>98.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;
HOUSEHOLD BUDGET</td>
<td>0</td>
<td>2</td>
<td>-1</td>
<td>1</td>
<td>16.3</td>
<td>202</td>
<td>5.2%</td>
</tr>
<tr style="font-weight: bold;">
<td colspan="8" class="firstcol">HOUSEHOLD
FIN SITUATION</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Last 12
months</td>
<td>-38</td>
<td>-39</td>
<td>-36</td>
<td>-37</td>
<td>36.7</td>
<td>138</td>
<td>35.2%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;&nbsp;
Next12 months</td>
<td>-6</td>
<td>-7</td>
<td>-6</td>
<td>-3</td>
<td>59.2</td>
<td>136</td>
<td>36.2%</td>
</tr>
<tr style="font-weight: bold;">
<td colspan="8" class="firstcol">HOUSEHOLD
SAVINGS</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Current</td>
<td>69</td>
<td>73</td>
<td>78</td>
<td>73</td>
<td>81.7</td>
<td>13</td>
<td>93.9%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Future</td>
<td>-29</td>
<td>-24</td>
<td>-23</td>
<td>-20</td>
<td>43.2</td>
<td>159</td>
<td>25.4%</td>
</tr>
<tr style="font-weight: bold;">
<td colspan="8" class="firstcol">MAJOR
Purchases</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Current</td>
<td>-40</td>
<td>-39</td>
<td>-36</td>
<td>-38</td>
<td>47.1</td>
<td>98</td>
<td>54.0%</td>
</tr>
<tr>
<td colspan="8" class="firstcol">Total
number of months: Back to Jul-92</td>
</tr>
</tbody>
</table>
<span id="articletitle">Michigan Consumer Sentiment Is
Stable At Improved Level</span><br>
<span id="byline">by <a href="/comment/Moeller.html">Tom
Moeller</a> </span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100326f.jpg" style="width: 312px; height: 265px;">
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100326g.jpg" style="width: 312px; height: 265px;"></p>
<p>Consumer sentiment isn't exactly ebullient, but it is
improved. The University of Michigan reported that its index of
consumer sentiment for the full month of March held steady at 73.6 with
February. That was, however, up from the mid-month reading and up
considerably from the low late in 2008. The figure was slightly higher
than Consensus expectations. The index reached a high of 74.4 this past
January. During the last ten years there has been a 90% correlation
between the level of sentiment and the y/y change in real consumer
spending.</p>
<p>The index of expected economic conditions slipped 0.7% m/m.
Expectations for business conditions fell both for the next year fell
(+77.3% y/y) and for the next five years (+30.2% y/y) as well.
Expectations for personal finances improved (7.7% y/y) to the highest
level this year.</p>
<p>Sentiment about current economic conditions rose just slightly
(30.2% y/y) for the second month. The assessment of current personal
finances (20.3% y/y) recouped a February decline and buying conditions
for large household goods, including furniture, refrigerators, stoves
&amp; televisions (38.8% y/y) were unchanged.</p>
<p>Expected price inflation during the next year slipped to 3.4%
but was up from the December 2008 reading of 1.7%.Respondents' view of
government policy, which may eventually influence economic
expectations, improved slightly m/m but remained down 30.6% from its
high last May. Fifteen percent of respondents thought that a good job
was being done by government versus 40% who thought a poor job was
being done, a twelve-month high.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100326h.jpg" style="width: 312px; height: 265px;"><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100326i.jpg" style="width: 312px; height: 265px;">
<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/USECON/@EF/@EF14/@EF1402/@EF1402.HTM"><b>University
of Michigan</b></a></th>
<th scope="col"><b>March</b></th>
<th scope="col"><b>Mid-March</b></th>
<th scope="col"><b>&nbsp;February</b></th>
<th scope="col"><b>January</b></th>
<th scope="col"><b>March y/y</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Consumer Sentiment</td>
<td>73.6</td>
<td>72.5</td>
<td>73.6</td>
<td>74.4</td>
<td><span>28.4%</span></td>
<td>66.3</td>
<td>63.8</td>
<td>85.6</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Current Conditions</td>
<td>82.4</td>
<td>80.8</td>
<td>81.8</td>
<td>81.1</td>
<td>30.2</td>
<td>69.6</td>
<td>73.7</td>
<td>101.2</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Expectations</td>
<td>67.9</td>
<td>67.2</td>
<td>68.4</td>
<td>70.1</td>
<td>26.9</td>
<td>64.1</td>
<td>57.3</td>
<td>75.6</td>
</tr>
</tbody>
</table>
</body></html>

Last quarter was a strong one for the U.S. economy and the revised picture is little different from the one depicted earlier. The latest revision, however, lowered the growth rate slightly to 5.6% from 5.9%. Nevertheless, last [...]

U.S. GDP 4Q Increase IsLowered Slightly; Profits Are Firm

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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>
<br>

<span id="articletext">
<p>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100325e.jpg" style="width: 353px; height: 265px;" align="right">
The Federal Reserve Bank of San Francisco generates a figure called the
"Tech Pulse Index" to follow developments in the U.S. technology
sector. It is designed to be a summary statistic that tracks the health
of this sector in a timely manner. Lately, it has been flashing a
signal of solid recovery with activity at the highest level since the
summer of '08.&nbsp;&nbsp;</p><p>During 4Q09, the index
expanded by 33.7% (AR) following a lesser 3Q gain. These gains followed
four negative readings during the recession which totaled 25.8%. The
historical relationship of the index to the sector is quite good,
having<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100325f.jpg" style="width: 353px; height: 265px;" align="right">
an 92% correlation with the quarterly change in real information
processing equipment &amp; software spending in the National Income
&amp; Product Accounts during the last twenty years.&nbsp;</p><p>The
index is made up of several indicators: 1) The index of industrial
production of computers, communications equipment, and semiconductors,
2) payroll employment in the&nbsp; industries of computer and
electronic product manufacturing, telecommunications, web search
portals and data processing, computer systems design &amp; related
services, 3) real private nonresidential investment in computers
&amp; peripheral equipment, software, &amp; communications
equipment, 4) real personal consumption expenditures on computers,
peripherals and software, 5) manufacturers' shipments of computers and
electronic products in current dollars (used for January 1992
onwards.)</p><p> The data can be found in Haver's <b>SURVEYS</b>
database.&nbsp;</p>
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol"><b>Tech
Pulse Index&nbsp; (FRB San Francisco) </b></th>
<th scope="col"><b>February</b></th>
<th scope="col"><b>January</b></th>
<th scope="col"><b>December</b></th>
<th scope="col"><b>2009</b></th>
<th scope="col"><b>2008</b></th>
<th scope="col"><b>2007</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Index Level (Jan. 2000 = 100)</td>
<td>94.0</td>
<td>87.5</td>
<td>84.0</td>
<td>87.7</td>
<td>107.2</td>
<td>102.9</td>
</tr>
<tr>
<td class="firstcol">&nbsp; Q/Q Chg.</td>
<td>33.7%</td>
<td>17.3%</td>
<td>-6.1%</td>
<td>-18.2%</td>
<td>4.2%</td>
<td>9.9%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp; Y/Y Chg.</td>
<td>-1.6%</td>
<td>-18.8%</td>
<td>-25.8%</td>
<td>--</td>
<td>--</td>
<td>--</td>
</tr>
</tbody>
</table>
</span></body></html>

The Federal Reserve Bank of San Francisco generates a figure called the "Tech Pulse Index" to follow developments in the U.S. technology sector. It is designed to be a summary statistic that tracks the health of this sector in a [...]

The Technology Sector Is Firming

Robert Brusca

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100325d.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>UK retail sales are up by a sharper-than-expected 1.9% in
February but the bounce is from a 2.5% drop in January. The UK sales
path has been a rocky one as the growth rate chart above attests. As
you would expect, Yr/Yr sales have been the most stable and largely
have continued to post their fluctuations in positive territory. But we
get a sense of momentum in comparing the growth rate of six months with
twelve-months and in comparing three-months with six-months. The
shorter the period for the growth rate calculation, the weaker the
growth rate and with a rise as the last observation, that is not a good
thing. Momentum is eroding from twelve months to six months and from
six months to three months.</p>
<p>Ex autos the retail sales growth rates show the same pattern
of decay as 12-month growth is 3.4% compared to a arte of -0.7% over
six months and of -4.5% over three months.</p>
<p>In the quarter-to-date both overall and ex-auto sales are
posting sizeable negative numbers.</p>
<p>Against that background it is hard to call the day&#8217;s numbers
good news. They are better than negative numbers at this point but UK
retail sales are doing nothing very special. The UK still appears to be
very growth-challenged.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup><col></colgroup>
<thead><tr>
<th colspan="9" scope="col"><b>UK Real
and Nominal Retail Sales</b> </th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td style="font-weight: bold;" class="firstcol">&nbsp; Nominal</td>
<td style="font-weight: bold;">Feb-10</td>
<td style="font-weight: bold;">Jan-10</td>
<td style="font-weight: bold;">Dec-09</td>
<td style="font-weight: bold;">3-MO</td>
<td style="font-weight: bold;">6-MO</td>
<td style="font-weight: bold;">12-MO</td>
<td style="font-weight: bold;">YrAGo</td>
<td style="font-weight: bold;">Quarter<br>
2-date</td>
</tr>
<tr>
<td class="firstcol">Retail Total</td>
<td>1.9%</td>
<td>-2.5%</td>
<td>0.0%</td>
<td>-2.7%</td>
<td>0.7%</td>
<td>4.9%</td>
<td>-3.0%</td>
<td>-8.0%</td>
</tr>
<tr>
<td class="firstcol">Food Bev &amp;
Tobacco</td>
<td>-1.2%</td>
<td>-1.3%</td>
<td>1.4%</td>
<td>-4.5%</td>
<td>-2.1%</td>
<td>0.8%</td>
<td>5.6%</td>
<td>-4.2%</td>
</tr>
<tr>
<td class="firstcol">Clothing footwear</td>
<td>1.5%</td>
<td>3.6%</td>
<td>0.5%</td>
<td>24.6%</td>
<td>12.5%</td>
<td>6.5%</td>
<td>-3.3%</td>
<td>20.4%</td>
</tr>
<tr class="odd">
<td colspan="9">&nbsp; Real</td>
</tr>
<tr>
<td class="firstcol">&nbsp;Retial
Ex auto</td>
<td>2.1%</td>
<td>-3.0%</td>
<td>-0.2%</td>
<td>-4.5%</td>
<td>-0.7%</td>
<td>3.4%</td>
<td>-2.7%</td>
<td>-10.3%</td>
</tr>
</tbody>
</table>
</body></html>

UK retail sales are up by a sharper-than-expected 1.9% in February but the bounce is from a 2.5% drop in January. The UK sales path has been a rocky one as the growth rate chart above attests. As you would expect, Yr/Yr sales have [...]

UK Retail Sales Rebound After Larger Set-Back

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100324c.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>If there is such a thing as a classic signal for a weather
effect this is it: sales fall but Yr/Yr prices rise. Housing prices are
not seasonally adjusted. They do exhibit some pretty pronounced
seasonal patterns, however. Yr/Yr percentage changes purge seasonality
from the data but make it harder to detect short term changes.</p>
<p>In February we have a 2.2% month-to-month drop in new home
sales led by a 20% drop in the wintry NE and a minus 18% result in the
snow-covered Midwest, compared to a -4.6% drop in the South and a 20.8%
gain in the West. The winter profile of losses/gains makes sense. The
turn up in prices shows median price gains Yr/Yr for the first time
since October of last year and only the third Yr/Yr rise for median
prices in 27 months. Average prices are up for three-months running;
the last three-month rise in prices ended in June of 2007.</p>
<p>Despite some sharp improvement in economic conditions the huge
fiscal help offered by the government has reached its limits. Attempts
to pull back and inject fiscal prudence are not being well-accepted in
France.</p>
<p>On balance this report really has the feel of a report
disrupted by weather in a market that is getting back in shape. The
existing home sales report was not as clean in producing its weather
effects since the lags are longer. Homebuilders count a sale as
consummated when the contract is signed. The NAR calls a deal a deal
when it closes, meaning that monies are exchanged which means that we
must wait out the financing process which these days is running three
months in many places.</p>
<p>I find this report on new home sales very encouraging since,
once prices are no longer falling, the real impediment to buying is
gone. And home affordability is still very high<span style="text-decoration: underline;">.</span></p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="8" scope="col"><b>New Single
Family Home Sales </b>
</th>
</tr>
</thead>
<tbody>
<tr class="even">
<td style="font-weight: bold;" colspan="1" rowspan="2" class="firstcol">&nbsp;As of:<br>
Feb.10</td>
<td style="font-weight: bold;" colspan="5">Momentum:
Annualized
Rates Of Change</td>
<td style="font-weight: bold;" colspan="2">Prices</td>
</tr>
<tr class="odd">
<td style="font-weight: bold;">Total</td>
<td style="font-weight: bold;">N.E</td>
<td style="font-weight: bold;">MidW</td>
<td style="font-weight: bold;">South</td>
<td style="font-weight: bold;">West</td>
<td style="font-weight: bold;">Median</td>
<td style="font-weight: bold;">Average</td>
</tr>
<tr class="grey2">
<td style="font-weight: bold;" class="firstcol" colspan="8">Month-to-month
percent
change</td>
</tr>
<tr class="odd">
<td class="firstcol">Feb.10</td>
<td>-2.2%</td>
<td>-20.0%</td>
<td>-18.0%</td>
<td>-4.6%</td>
<td>20.8%</td>
<td>6.1%</td>
<td>5.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">Jan.10</td>
<td>-8.7%</td>
<td>-10.3%</td>
<td>2.0%</td>
<td>-12.6%</td>
<td>-6.1%</td>
<td>-5.2%</td>
<td>-3.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">Dec.09</td>
<td>-4.7%</td>
<td>30.0%</td>
<td>-31.0%</td>
<td>-5.4%</td>
<td>7.9%</td>
<td>0.2%</td>
<td>1.8%</td>
</tr>
<tr style="font-weight: bold;" class="odd">
<td colspan="8" class="firstcol">Annualized Rates</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;</td>
<td style="font-weight: bold;">Total</td>
<td style="font-weight: bold;">N.E</td>
<td style="font-weight: bold;">MidW</td>
<td style="font-weight: bold;">South</td>
<td style="font-weight: bold;">West</td>
<td style="font-weight: bold;">Median</td>
<td style="font-weight: bold;">Average</td>
</tr>
<tr class="odd">
<td class="firstcol">3-Mo</td>
<td>-59.7%</td>
<td>-26.7%</td>
<td>-169.0%</td>
<td>-84.3%</td>
<td>89.5%</td>
<td>3.1%</td>
<td>12.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">6-Mo</td>
<td>-49.0%</td>
<td>-44.4%</td>
<td>-53.6%</td>
<td>-59.6%</td>
<td>-27.8%</td>
<td>13.4%</td>
<td>20.2%</td>
</tr>
<tr class="odd">
<td class="firstcol">1-Yr</td>
<td>-13.0%</td>
<td>0.0%</td>
<td>-18.0%</td>
<td>-29.5%</td>
<td>34.8%</td>
<td>5.2%</td>
<td>9.3%</td>
</tr>
<tr class="grey2">
<td style="font-weight: bold;" colspan="6" class="firstcol">Cumulative
prices
change since same mo of</td>
<td colspan="2">SAAR</td>
</tr>
<tr>
<td class="firstcol">&nbsp;</td>
<td>2008</td>
<td>2007</td>
<td>2006</td>
<td>2005</td>
<td>2004</td>
<td>5-yr%</td>
<td>10-Yr%</td>
</tr>
<tr class="odd">
<td class="firstcol">Avg</td>
<td>9.3%</td>
<td>-6.2%</td>
<td>-12.1%</td>
<td>-8.2%</td>
<td>-2.2%</td>
<td>-0.5%</td>
<td>3.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Median</td>
<td>5.2%</td>
<td>-10.1%</td>
<td>-12.1%</td>
<td>-12.1%</td>
<td>-7.1%</td>
<td>-1.5%</td>
<td>3.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;</td>
<td style="font-weight: bold;" colspan="5">Yr Yr price changes by
12-mo period</td>
<td colspan="2">&nbsp;&nbsp;&nbsp;&nbsp;</td>
</tr>
<tr class="odd">
<td class="firstcol">Avg</td>
<td>9.3%</td>
<td>-15.5%</td>
<td>-5.9%</td>
<td>3.9%</td>
<td>6.0%</td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td class="firstcol">Median</td>
<td>5.2%</td>
<td>-15.3%</td>
<td>-2.0%</td>
<td>0.0%</td>
<td>5.0%</td>
<td style="font-weight: bold;">Median</td>
<td style="font-weight: bold;">Average</td>
</tr>
<tr class="odd">
<td class="firstcol">Feb.10</td>
<td colspan="5">Max Drop in Current
Prices Since 2000</td>
<td>-16.0%</td>
<td>-14.2%</td>
</tr>
<tr class="odd">
<td colspan="8" class="firstcol">&amp;Drop is
calculated from higest point in period</td>
</tr>
</tbody>
</table>
</body></html>

If there is such a thing as a classic signal for a weather effect this is it: sales fall but Yr/Yr prices rise. Housing prices are not seasonally adjusted. They do exhibit some pretty pronounced seasonal patterns, however. Yr/Yr [...]

New Home Sales Drop But Prices Rise – Go Figure

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100324b.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: right;">
TheEuro-Area PMIs rose sharply in March. For MFG the index reached a
new
post recession high, it s strongest level since January 2007. For
services, the 1.68 point rise to 53.65 brings it close to its cycle
high reading of 53.71 and it stops a string of two months of
declines.&nbsp;</p>
<p>The services index is in the 62nd percentile of its 136 month
range;
the MFG index is in the 84th percentile of it range.&nbsp;</p>
<p> In addition to
all this good news, separately, the German IFO index moved sharply
higher, confirming goods news in Germany. The European economy is
giving off signals of real strength and brushing off notions that the
recovery there was falling on hard times. Still the euro is falling.</p>
<p>The bad news on the day that has dragged down the euro, was
the
downgrade to Portugal by Fitch. Meanwhile, France and Germany seem to
have to come to some agreement about letting the IMF assist Greece in
some way. We are all waiting to hear more on this.&nbsp;</p>
<p>With the
geopolitics of Europe seemingly dry tinder and sparks flying
everywhere, the news of better growth in the Zone is like news of a
refreshing spring shower that will damp the risks of spontaneous
combustion. There is still a long way to go to get Europe back to where
it needs to be. And the problems in Greece and the knock-on effects
there have exposed some animosities within the Zone that may have long
term effects on it. They could affect not only the Zone&#8217;s appetite for
expansion but also the perception of the attractiveness of membership
in the Zone by potential EMU candidate countries.</p>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="3" scope="col"> <b>FLASH
Readings</b>
</th>
</tr>
</thead>
<tbody>
<tr style="font-weight: bold;" class="odd">
<td style="text-align: center;" colspan="3" class="firstcol">Markit PMI's for the
Euro-Area</td>
</tr>
<tr class="grey3">
<td style="font-weight: bold;" class="firstcol">&nbsp;</td>
<td style="font-weight: bold;">MFG</td>
<td style="font-weight: bold;">Services</td>
</tr>
<tr class="grey1">
<td class="firstcol">Mar-10</td>
<td>56.34</td>
<td>53.65</td>
</tr>
<tr class="grey1">
<td class="firstcol">Feb-10</td>
<td>54.23</td>
<td>51.81</td>
</tr>
<tr class="grey1">
<td class="firstcol">Jan-10</td>
<td>52.39</td>
<td>52.50</td>
</tr>
<tr class="grey1">
<td class="firstcol">Dec-09</td>
<td>51.59</td>
<td>53.63</td>
</tr>
<tr style="font-weight: bold;" class="grey3">
<td style="text-align: center;" colspan="3" class="firstcol">Segment Averages</td>
</tr>
<tr class="grey1">
<td class="firstcol">3-Mo</td>
<td>52.74</td>
<td>52.65</td>
</tr>
<tr class="grey1">
<td class="firstcol">6-Mo</td>
<td>51.57</td>
<td>52.86</td>
</tr>
<tr class="grey1">
<td class="firstcol">12-Mo</td>
<td>46.50</td>
<td>49.60</td>
</tr>
<tr style="font-weight: bold;" class="grey3">
<td style="text-align: center;" colspan="3">136-Mo-Range</td>
</tr>
<tr class="grey1">
<td class="firstcol">High</td>
<td>60.47</td>
<td>62.36</td>
</tr>
<tr class="grey1">
<td class="firstcol">Low</td>
<td>33.55</td>
<td>39.24</td>
</tr>
<tr class="grey1">
<td class="firstcol">% Range</td>
<td>84.7%</td>
<td>62.3%</td>
</tr>
<tr class="grey1">
<td class="firstcol">Range</td>
<td>26.92</td>
<td>23.12</td>
</tr>
<tr class="grey1">
<td class="firstcol">Average</td>
<td>51.13</td>
<td>53.64</td>
</tr>
</tbody>
</table>
</span>
</body></html>

TheEuro-Area PMIs rose sharply in March. For MFG the index reached a new post recession high, it s strongest level since January 2007. For services, the 1.68 point rise to 53.65 brings it close to its cycle high reading of 53.71 and [...]

Euro-Area PMIs Rise Sharply Other Things Unravel…

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100324a.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p><span style="font-weight: bold;">Broad trends: </span>Durable
goods orders and shipments are still rebounding, but the pace of
increase has topped out in February when we observe the Yr/Yr trend in
the chart. The rise in orders continues to run ahead of shipments
growth. That bodes well for the prospect for a further advance in
shipments. Also the continuing advance of the Fed surveys for March
tells us that the MFG rebound is continuing and argues to interpret
current weakness as weather-related disruptions to monthly durable
goods data as just the sort we&#8217;d expect after seeing the knock-down in
hours in the February employment report. The monthly data are showing
some weakening trends but when grouped into three-month intervals
durable goods trends are holding up much better.</p>
<p><span style="font-weight: bold;">Monthly patterns:</span>
Monthly data show shipments are off by 0.6% and falling by 0.1% in
January. New Orders rose by 0.5% in February compared to a rise of 3.9%
in January. Unfilled orders now are up for two months in a row at 0.4%
in February and 0.2% in January. Inventories also are up for two months
running by 0.3% in February and 0.1% in January. Despite the two-month
drop in shipments, many trends even on a monthly basis still show
improvement.</p>
<p><span style="font-weight: bold;">Short-term
growth rate trends and progressions</span> - The three-month
sequential growth rates show shipments are still growing and at a
relatively rapid and steady pace in the most recent three months.
Orders are accelerating steadily over increasingly more recent
three-month periods. Inventories switch to growing from shrinking over
the most recent three-month period. Unfilled orders continue to shrink,
but the pace of shrinkage is decelerating.</p>
<p><span style="font-weight: bold;"> Summing up</span>
- Excluding transportation, orders are weaker but shipments are
stronger over 3 months and 12 months. For nondefense capital goods,
shipments are declining over three months but orders are extremely
strong. Ultimately order strength should bring shipments around as
shipments are more likely than orders to succumb to short term
disturbances like bad weather.</p>
</span>

<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr><th colspan="6" scope="col"> <b>Durable Goods Orders</b></th>
</tr>
</thead>
<tbody>
<tr class="grey4">
<td style="font-weight: bold;" class="firstcol">Durable Goods</td>
<td style="font-weight: bold;">3Mo</td>
<td style="font-weight: bold;">6Mo</td>
<td style="font-weight: bold;">9Mo</td>
<td style="font-weight: bold;">12Mo</td>
<td style="font-weight: bold;">YearAgo</td>
</tr>
<tr class="grey3">
<td class="firstcol">Shipments</td>
<td>7.0%</td>
<td>8.8%</td>
<td>8.2%</td>
<td>2.1%</td>
<td>-17.3%</td>
</tr>
<tr class="grey3">
<td class="firstcol">New Orders</td>
<td>28.1%</td>
<td>17.9%</td>
<td>12.2%</td>
<td>10.9%</td>
<td>-26.2%</td>
</tr>
<tr class="grey3">
<td class="firstcol">Unfilled Orders</td>
<td>-1.1%</td>
<td>-3.6%</td>
<td>-4.5%</td>
<td>-6.5%</td>
<td>-2.3%</td>
</tr>
<tr class="grey3">
<td class="firstcol">Inventories</td>
<td>0.8%</td>
<td>-2.7%</td>
<td>-6.9%</td>
<td>-9.0%</td>
<td>3.4%</td>
</tr>
<tr class="grey3">
<td class="firstcol">I:S Ratio</td>
<td>1.72</td>
<td>1.79</td>
<td>1.89</td>
<td>1.90</td>
<td>1.52</td>
</tr>
<tr class="grey4">
<td style="font-weight: bold;" class="firstcol">&nbsp;Excluding
Transportation</td>
<td style="font-weight: bold;">3Mo</td>
<td style="font-weight: bold;">6Mo</td>
<td style="font-weight: bold;">9Mo</td>
<td style="font-weight: bold;">12Mo</td>
<td style="font-weight: bold;">YearAgo</td>
</tr>
<tr class="grey3">
<td class="firstcol">Shipments</td>
<td>9.9%</td>
<td>9.9%</td>
<td>9.3%</td>
<td>3.2%</td>
<td>-16.1%</td>
</tr>
<tr class="grey3">
<td class="firstcol">New Orders</td>
<td>9.2%</td>
<td>12.9%</td>
<td>12.3%</td>
<td>7.9%</td>
<td>-19.9%</td>
</tr>
<tr class="grey3">
<td class="firstcol">Unfilled Orders</td>
<td>3.2%</td>
<td>2.6%</td>
<td>0.4%</td>
<td>-3.6%</td>
<td>-7.2%</td>
</tr>
<tr class="grey3">
<td class="firstcol">Inventories</td>
<td>0.5%</td>
<td>-3.1%</td>
<td>-8.2%</td>
<td>-11.0%</td>
<td>-0.1%</td>
</tr>
<tr class="grey3">
<td class="firstcol">I:S Ratio</td>
<td>1.61</td>
<td>1.67</td>
<td>1.79</td>
<td>1.82</td>
<td>1.53</td>
</tr>
<tr class="grey4">
<td style="font-weight: bold;" class="firstcol">&nbsp;Excluding
Defense</td>
<td style="font-weight: bold;">3Mo</td>
<td style="font-weight: bold;">6Mo</td>
<td style="font-weight: bold;">9Mo</td>
<td style="font-weight: bold;">12Mo</td>
<td style="font-weight: bold;">YearAgo</td>
</tr>
<tr class="grey2">
<td class="firstcol">Shipments</td>
<td>7.1%</td>
<td>9.3%</td>
<td>8.5%</td>
<td>1.8%</td>
<td>-19.3%</td>
</tr>
<tr class="grey2">
<td class="firstcol">New Orders</td>
<td>21.9%</td>
<td>18.1%</td>
<td>14.9%</td>
<td>11.0%</td>
<td>-27.7%</td>
</tr>
<tr class="grey2">
<td class="firstcol">Unfilled Orders</td>
<td>-0.2%</td>
<td>-1.9%</td>
<td>-3.1%</td>
<td>-6.4%</td>
<td>-3.9%</td>
</tr>
<tr class="grey2">
<td class="firstcol">Inventories</td>
<td>-0.1%</td>
<td>-3.6%</td>
<td>-7.9%</td>
<td>-10.2%</td>
<td>3.0%</td>
</tr>
<tr class="grey2">
<td style="font-weight: bold;" class="firstcol">I:S Ratio</td>
<td style="font-weight: bold;">1.70</td>
<td style="font-weight: bold;">1.78</td>
<td style="font-weight: bold;">1.89</td>
<td style="font-weight: bold;">1.89</td>
<td style="font-weight: bold;">1.48</td>
</tr>
<tr class="grey4">
<td style="font-weight: bold;" class="firstcol">&nbsp;NonDefense
Capital Goods</td>
<td style="font-weight: bold;">3Mo</td>
<td style="font-weight: bold;">6Mo</td>
<td style="font-weight: bold;">9Mo</td>
<td style="font-weight: bold;">12Mo</td>
<td style="font-weight: bold;">YearAgo</td>
</tr>
<tr class="grey1">
<td class="firstcol">Shipments</td>
<td>-0.8%</td>
<td>6.0%</td>
<td>3.6%</td>
<td>-0.7%</td>
<td>-12.9%</td>
</tr>
<tr class="grey1">
<td class="firstcol">New Orders</td>
<td>58.5%</td>
<td>33.9%</td>
<td>19.1%</td>
<td>21.4%</td>
<td>-33.4%</td>
</tr>
<tr class="grey1">
<td class="firstcol">Unfilled Orders</td>
<td>-1.4%</td>
<td>-4.5%</td>
<td>-5.4%</td>
<td>-8.0%</td>
<td>-0.9%</td>
</tr>
<tr class="grey1">
<td class="firstcol">Inventories</td>
<td>0.0%</td>
<td>-3.6%</td>
<td>-7.7%</td>
<td>-8.7%</td>
<td>10.8%</td>
</tr>
<tr class="grey1">
<td class="firstcol">I:S Ratio</td>
<td>2.30</td>
<td>2.42</td>
<td>2.52</td>
<td>2.51</td>
<td>1.97</td>
</tr>
<tr class="grey4">
<td class="firstcol">Memo: PPI Durables</td>
<td>0.6%</td>
<td>-0.5%</td>
<td>0.3%</td>
<td>0.2%</td>
<td>3.4%</td>
</tr>
</tbody>
</table>
</body></html>

Broad trends: Durable goods orders and shipments are still rebounding, but the pace of increase has topped out in February when we observe the Yr/Yr trend in the chart. The rise in orders continues to run ahead of shipments growth. [...]

Durable Goods Trends Continue Higher

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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>
<br>

<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100324a.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p><span style="font-weight: bold;">Broad trends: </span>Durable
goods orders and shipments are still rebounding, but the pace of
increase has topped out in February when we observe the Yr/Yr trend in
the chart. The rise in orders continues to run ahead of shipments
growth. That bodes well for the prospect for a further advance in
shipments. Also the continuing advance of the Fed surveys for March
tells us that the MFG rebound is continuing and argues to interpret
current weakness as weather-related disruptions to monthly durable
goods data as just the sort we&#8217;d expect after seeing the knock-down in
hours in the February employment report. The monthly data are showing
some weakening trends but when grouped into three-month intervals
durable goods trends are holding up much better.</p>
<p><span style="font-weight: bold;">Monthly patterns:</span>
Monthly data show shipments are off by 0.6% and falling by 0.1% in
January. New Orders rose by 0.5% in February compared to a rise of 3.9%
in January. Unfilled orders now are up for two months in a row at 0.4%
in February and 0.2% in January. Inventories also are up for two months
running by 0.3% in February and 0.1% in January. Despite the two-month
drop in shipments, many trends even on a monthly basis still show
improvement.</p>
<p><span style="font-weight: bold;">Short-term
growth rate trends and progressions</span> - The three-month
sequential growth rates show shipments are still growing and at a
relatively rapid and steady pace in the most recent three months.
Orders are accelerating steadily over increasingly more recent
three-month periods. Inventories switch to growing from shrinking over
the most recent three-month period. Unfilled orders continue to shrink,
but the pace of shrinkage is decelerating.</p>
<p><span style="font-weight: bold;"> Summing up</span>
- Excluding transportation, orders are weaker but shipments are
stronger over 3 months and 12 months. For nondefense capital goods,
shipments are declining over three months but orders are extremely
strong. Ultimately order strength should bring shipments around as
shipments are more likely than orders to succumb to short term
disturbances like bad weather.</p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="6" scope="col"> <b>Durable
Goods Orders</b></th>
</tr>
</thead>
<tbody>
<tr class="grey4">
<td style="font-weight: bold;" class="firstcol">Durable
Goods</td>
<td style="font-weight: bold;">3Mo</td>
<td style="font-weight: bold;">6Mo</td>
<td style="font-weight: bold;">9Mo</td>
<td style="font-weight: bold;">12Mo</td>
<td style="font-weight: bold;">YearAgo</td>
</tr>
<tr class="grey3">
<td class="firstcol">Shipments</td>
<td>7.0%</td>
<td>8.8%</td>
<td>8.2%</td>
<td>2.1%</td>
<td>-17.3%</td>
</tr>
<tr class="grey3">
<td class="firstcol">New Orders</td>
<td>28.1%</td>
<td>17.9%</td>
<td>12.2%</td>
<td>10.9%</td>
<td>-26.2%</td>
</tr>
<tr class="grey3">
<td class="firstcol">Unfilled Orders</td>
<td>-1.1%</td>
<td>-3.6%</td>
<td>-4.5%</td>
<td>-6.5%</td>
<td>-2.3%</td>
</tr>
<tr class="grey3">
<td class="firstcol">Inventories</td>
<td>0.8%</td>
<td>-2.7%</td>
<td>-6.9%</td>
<td>-9.0%</td>
<td>3.4%</td>
</tr>
<tr class="grey3">
<td class="firstcol">I:S Ratio</td>
<td>1.72</td>
<td>1.79</td>
<td>1.89</td>
<td>1.90</td>
<td>1.52</td>
</tr>
<tr class="grey4">
<td style="font-weight: bold;" class="firstcol">&nbsp;Excluding
Transportation</td>
<td style="font-weight: bold;">3Mo</td>
<td style="font-weight: bold;">6Mo</td>
<td style="font-weight: bold;">9Mo</td>
<td style="font-weight: bold;">12Mo</td>
<td style="font-weight: bold;">YearAgo</td>
</tr>
<tr class="grey3">
<td class="firstcol">Shipments</td>
<td>9.9%</td>
<td>9.9%</td>
<td>9.3%</td>
<td>3.2%</td>
<td>-16.1%</td>
</tr>
<tr class="grey3">
<td class="firstcol">New Orders</td>
<td>9.2%</td>
<td>12.9%</td>
<td>12.3%</td>
<td>7.9%</td>
<td>-19.9%</td>
</tr>
<tr class="grey3">
<td class="firstcol">Unfilled Orders</td>
<td>3.2%</td>
<td>2.6%</td>
<td>0.4%</td>
<td>-3.6%</td>
<td>-7.2%</td>
</tr>
<tr class="grey3">
<td class="firstcol">Inventories</td>
<td>0.5%</td>
<td>-3.1%</td>
<td>-8.2%</td>
<td>-11.0%</td>
<td>-0.1%</td>
</tr>
<tr class="grey3">
<td class="firstcol">I:S Ratio</td>
<td>1.61</td>
<td>1.67</td>
<td>1.79</td>
<td>1.82</td>
<td>1.53</td>
</tr>
<tr class="grey4">
<td style="font-weight: bold;" class="firstcol">&nbsp;Excluding
Defense</td>
<td style="font-weight: bold;">3Mo</td>
<td style="font-weight: bold;">6Mo</td>
<td style="font-weight: bold;">9Mo</td>
<td style="font-weight: bold;">12Mo</td>
<td style="font-weight: bold;">YearAgo</td>
</tr>
<tr class="grey2">
<td class="firstcol">Shipments</td>
<td>7.1%</td>
<td>9.3%</td>
<td>8.5%</td>
<td>1.8%</td>
<td>-19.3%</td>
</tr>
<tr class="grey2">
<td class="firstcol">New Orders</td>
<td>21.9%</td>
<td>18.1%</td>
<td>14.9%</td>
<td>11.0%</td>
<td>-27.7%</td>
</tr>
<tr class="grey2">
<td class="firstcol">Unfilled Orders</td>
<td>-0.2%</td>
<td>-1.9%</td>
<td>-3.1%</td>
<td>-6.4%</td>
<td>-3.9%</td>
</tr>
<tr class="grey2">
<td class="firstcol">Inventories</td>
<td>-0.1%</td>
<td>-3.6%</td>
<td>-7.9%</td>
<td>-10.2%</td>
<td>3.0%</td>
</tr>
<tr class="grey2">
<td style="font-weight: bold;" class="firstcol">I:S
Ratio</td>
<td style="font-weight: bold;">1.70</td>
<td style="font-weight: bold;">1.78</td>
<td style="font-weight: bold;">1.89</td>
<td style="font-weight: bold;">1.89</td>
<td style="font-weight: bold;">1.48</td>
</tr>
<tr class="grey4">
<td style="font-weight: bold;" class="firstcol">&nbsp;NonDefense
Capital Goods</td>
<td style="font-weight: bold;">3Mo</td>
<td style="font-weight: bold;">6Mo</td>
<td style="font-weight: bold;">9Mo</td>
<td style="font-weight: bold;">12Mo</td>
<td style="font-weight: bold;">YearAgo</td>
</tr>
<tr class="grey1">
<td class="firstcol">Shipments</td>
<td>-0.8%</td>
<td>6.0%</td>
<td>3.6%</td>
<td>-0.7%</td>
<td>-12.9%</td>
</tr>
<tr class="grey1">
<td class="firstcol">New Orders</td>
<td>58.5%</td>
<td>33.9%</td>
<td>19.1%</td>
<td>21.4%</td>
<td>-33.4%</td>
</tr>
<tr class="grey1">
<td class="firstcol">Unfilled Orders</td>
<td>-1.4%</td>
<td>-4.5%</td>
<td>-5.4%</td>
<td>-8.0%</td>
<td>-0.9%</td>
</tr>
<tr class="grey1">
<td class="firstcol">Inventories</td>
<td>0.0%</td>
<td>-3.6%</td>
<td>-7.7%</td>
<td>-8.7%</td>
<td>10.8%</td>
</tr>
<tr class="grey1">
<td class="firstcol">I:S Ratio</td>
<td>2.30</td>
<td>2.42</td>
<td>2.52</td>
<td>2.51</td>
<td>1.97</td>
</tr>
<tr class="grey4">
<td class="firstcol">Memo: PPI Durables</td>
<td>0.6%</td>
<td>-0.5%</td>
<td>0.3%</td>
<td>0.2%</td>
<td>3.4%</td>
</tr>
</tbody>
</table>
<span id="articletitle">Euro-Area PMIs Rise Sharply Other
Things Unravel&#8230; </span><br>
<span id="byline">by <a href="/comment/Brusca.html">Robert
Brusca</a> March 24, 2010</span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100324b.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: right;">
TheEuro-Area PMIs rose sharply in March. For MFG the index reached a
new
post recession high, it s strongest level since January 2007. For
services, the 1.68 point rise to 53.65 brings it close to its cycle
high reading of 53.71 and it stops a string of two months of
declines.&nbsp;</p>
<p>The services index is in the 62nd percentile of its 136 month
range;
the MFG index is in the 84th percentile of it range.&nbsp;</p>
<p> In addition to
all this good news, separately, the German IFO index moved sharply
higher, confirming goods news in Germany. The European economy is
giving off signals of real strength and brushing off notions that the
recovery there was falling on hard times. Still the euro is falling.</p>
<p>The bad news on the day that has dragged down the euro, was
the
downgrade to Portugal by Fitch. Meanwhile, France and Germany seem to
have to come to some agreement about letting the IMF assist Greece in
some way. We are all waiting to hear more on this.&nbsp;</p>
<p>With the
geopolitics of Europe seemingly dry tinder and sparks flying
everywhere, the news of better growth in the Zone is like news of a
refreshing spring shower that will damp the risks of spontaneous
combustion. There is still a long way to go to get Europe back to where
it needs to be. And the problems in Greece and the knock-on effects
there have exposed some animosities within the Zone that may have long
term effects on it. They could affect not only the Zone&#8217;s appetite for
expansion but also the perception of the attractiveness of membership
in the Zone by potential EMU candidate countries.</p>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="3" scope="col"> <b>FLASH
Readings</b>
</th>
</tr>
</thead>
<tbody>
<tr style="font-weight: bold;" class="odd">
<td style="text-align: center;" colspan="3" class="firstcol">Markit PMI's for the
Euro-Area</td>
</tr>
<tr class="grey3">
<td style="font-weight: bold;" class="firstcol">&nbsp;</td>
<td style="font-weight: bold;">MFG</td>
<td style="font-weight: bold;">Services</td>
</tr>
<tr class="grey1">
<td class="firstcol">Mar-10</td>
<td>56.34</td>
<td>53.65</td>
</tr>
<tr class="grey1">
<td class="firstcol">Feb-10</td>
<td>54.23</td>
<td>51.81</td>
</tr>
<tr class="grey1">
<td class="firstcol">Jan-10</td>
<td>52.39</td>
<td>52.50</td>
</tr>
<tr class="grey1">
<td class="firstcol">Dec-09</td>
<td>51.59</td>
<td>53.63</td>
</tr>
<tr style="font-weight: bold;" class="grey3">
<td style="text-align: center;" colspan="3" class="firstcol">Segment Averages</td>
</tr>
<tr class="grey1">
<td class="firstcol">3-Mo</td>
<td>52.74</td>
<td>52.65</td>
</tr>
<tr class="grey1">
<td class="firstcol">6-Mo</td>
<td>51.57</td>
<td>52.86</td>
</tr>
<tr class="grey1">
<td class="firstcol">12-Mo</td>
<td>46.50</td>
<td>49.60</td>
</tr>
<tr style="font-weight: bold;" class="grey3">
<td style="text-align: center;" colspan="3">136-Mo-Range</td>
</tr>
<tr class="grey1">
<td class="firstcol">High</td>
<td>60.47</td>
<td>62.36</td>
</tr>
<tr class="grey1">
<td class="firstcol">Low</td>
<td>33.55</td>
<td>39.24</td>
</tr>
<tr class="grey1">
<td class="firstcol">% Range</td>
<td>84.7%</td>
<td>62.3%</td>
</tr>
<tr class="grey1">
<td class="firstcol">Range</td>
<td>26.92</td>
<td>23.12</td>
</tr>
<tr class="grey1">
<td class="firstcol">Average</td>
<td>51.13</td>
<td>53.64</td>
</tr>
</tbody>
</table>
</span>
<span id="articletitle">New Home Sales Drop But Prices
Rise &#8211; Go Figure</span><br>
<span id="byline">by <a href="/comment/Brusca.html">Robert
Brusca</a> March 24, 2010</span>
<span id="articletext">
<p></p>
<p><img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100324c.jpg" style="border: 0px solid ; width: 353px; height: 265px; float: left;" align="left"></p>
<p>If there is such a thing as a classic signal for a weather
effect this is it: sales fall but Yr/Yr prices rise. Housing prices are
not seasonally adjusted. They do exhibit some pretty pronounced
seasonal patterns, however. Yr/Yr percentage changes purge seasonality
from the data but make it harder to detect short term changes.</p>
<p>In February we have a 2.2% month-to-month drop in new home
sales led by a 20% drop in the wintry NE and a minus 18% result in the
snow-covered Midwest, compared to a -4.6% drop in the South and a 20.8%
gain in the West. The winter profile of losses/gains makes sense. The
turn up in prices shows median price gains Yr/Yr for the first time
since October of last year and only the third Yr/Yr rise for median
prices in 27 months. Average prices are up for three-months running;
the last three-month rise in prices ended in June of 2007.</p>
<p>Despite some sharp improvement in economic conditions the huge
fiscal help offered by the government has reached its limits. Attempts
to pull back and inject fiscal prudence are not being well-accepted in
France.</p>
<p>On balance this report really has the feel of a report
disrupted by weather in a market that is getting back in shape. The
existing home sales report was not as clean in producing its weather
effects since the lags are longer. Homebuilders count a sale as
consummated when the contract is signed. The NAR calls a deal a deal
when it closes, meaning that monies are exchanged which means that we
must wait out the financing process which these days is running three
months in many places.</p>
<p>I find this report on new home sales very encouraging since,
once prices are no longer falling, the real impediment to buying is
gone. And home affordability is still very high<span style="text-decoration: underline;">.</span></p>
</span>
<table border="0" cellspacing="0" width="100%">
<colgroup></colgroup>
<thead><tr>
<th colspan="8" scope="col"><b>New Single
Family Home Sales </b>
</th>
</tr>
</thead>
<tbody>
<tr class="even">
<td style="font-weight: bold;" colspan="1" rowspan="2" class="firstcol">&nbsp;As of:<br>
Feb.10</td>
<td style="font-weight: bold;" colspan="5">Momentum:
Annualized
Rates Of Change</td>
<td style="font-weight: bold;" colspan="2">Prices</td>
</tr>
<tr class="odd">
<td style="font-weight: bold;">Total</td>
<td style="font-weight: bold;">N.E</td>
<td style="font-weight: bold;">MidW</td>
<td style="font-weight: bold;">South</td>
<td style="font-weight: bold;">West</td>
<td style="font-weight: bold;">Median</td>
<td style="font-weight: bold;">Average</td>
</tr>
<tr class="grey2">
<td style="font-weight: bold;" class="firstcol" colspan="8">Month-to-month
percent
change</td>
</tr>
<tr class="odd">
<td class="firstcol">Feb.10</td>
<td>-2.2%</td>
<td>-20.0%</td>
<td>-18.0%</td>
<td>-4.6%</td>
<td>20.8%</td>
<td>6.1%</td>
<td>5.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">Jan.10</td>
<td>-8.7%</td>
<td>-10.3%</td>
<td>2.0%</td>
<td>-12.6%</td>
<td>-6.1%</td>
<td>-5.2%</td>
<td>-3.8%</td>
</tr>
<tr class="odd">
<td class="firstcol">Dec.09</td>
<td>-4.7%</td>
<td>30.0%</td>
<td>-31.0%</td>
<td>-5.4%</td>
<td>7.9%</td>
<td>0.2%</td>
<td>1.8%</td>
</tr>
<tr style="font-weight: bold;" class="odd">
<td colspan="8" class="firstcol">Annualized
Rates</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;</td>
<td style="font-weight: bold;">Total</td>
<td style="font-weight: bold;">N.E</td>
<td style="font-weight: bold;">MidW</td>
<td style="font-weight: bold;">South</td>
<td style="font-weight: bold;">West</td>
<td style="font-weight: bold;">Median</td>
<td style="font-weight: bold;">Average</td>
</tr>
<tr class="odd">
<td class="firstcol">3-Mo</td>
<td>-59.7%</td>
<td>-26.7%</td>
<td>-169.0%</td>
<td>-84.3%</td>
<td>89.5%</td>
<td>3.1%</td>
<td>12.0%</td>
</tr>
<tr class="odd">
<td class="firstcol">6-Mo</td>
<td>-49.0%</td>
<td>-44.4%</td>
<td>-53.6%</td>
<td>-59.6%</td>
<td>-27.8%</td>
<td>13.4%</td>
<td>20.2%</td>
</tr>
<tr class="odd">
<td class="firstcol">1-Yr</td>
<td>-13.0%</td>
<td>0.0%</td>
<td>-18.0%</td>
<td>-29.5%</td>
<td>34.8%</td>
<td>5.2%</td>
<td>9.3%</td>
</tr>
<tr class="grey2">
<td style="font-weight: bold;" colspan="6" class="firstcol">Cumulative
prices
change since same mo of</td>
<td colspan="2">SAAR</td>
</tr>
<tr>
<td class="firstcol">&nbsp;</td>
<td>2008</td>
<td>2007</td>
<td>2006</td>
<td>2005</td>
<td>2004</td>
<td>5-yr%</td>
<td>10-Yr%</td>
</tr>
<tr class="odd">
<td class="firstcol">Avg</td>
<td>9.3%</td>
<td>-6.2%</td>
<td>-12.1%</td>
<td>-8.2%</td>
<td>-2.2%</td>
<td>-0.5%</td>
<td>3.6%</td>
</tr>
<tr class="odd">
<td class="firstcol">Median</td>
<td>5.2%</td>
<td>-10.1%</td>
<td>-12.1%</td>
<td>-12.1%</td>
<td>-7.1%</td>
<td>-1.5%</td>
<td>3.1%</td>
</tr>
<tr class="odd">
<td class="firstcol">&nbsp;</td>
<td style="font-weight: bold;" colspan="5">Yr
Yr price changes by
12-mo period</td>
<td colspan="2">&nbsp;&nbsp;&nbsp;&nbsp;</td>
</tr>
<tr class="odd">
<td class="firstcol">Avg</td>
<td>9.3%</td>
<td>-15.5%</td>
<td>-5.9%</td>
<td>3.9%</td>
<td>6.0%</td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td class="firstcol">Median</td>
<td>5.2%</td>
<td>-15.3%</td>
<td>-2.0%</td>
<td>0.0%</td>
<td>5.0%</td>
<td style="font-weight: bold;">Median</td>
<td style="font-weight: bold;">Average</td>
</tr>
<tr class="odd">
<td class="firstcol">Feb.10</td>
<td colspan="5">Max Drop in Current
Prices Since 2000</td>
<td>-16.0%</td>
<td>-14.2%</td>
</tr>
<tr class="odd">
<td colspan="8" class="firstcol">&amp;Drop
is
calculated from higest point in period</td>
</tr>
</tbody>
</table>
</body></html>

Durable Goods Trends ContinueHigher

Louise Curley

<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN">
<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>
<br>

<span id="articletext">
<p></p>
<p>After some ten months of deflation measured by the year to
year decline in the consumer price index, Taiwan has now experienced
two months of inflation. In January the year to year change in the
consumer price index was a small positive of 0.26%, and in February,
the change was more significant at 2.35%. The deflation in the consumer
price index was due largely to price declines in the prices of gas and
oil. Now that the prices of fuels have resumed rising, the inflation is
beginning to pick up.</p><p>There are however, other measures of
deflation/inflation--the GDP deflator for one. Year to year changes in
the quarterly GDP deflator are shown in the first chart compared with
the year to year changes in the quarterly consumer price index.
Measured by changes in the deflator, it appears that deflation has been
deeper and more persistent than that indicated by the consumer price
index. The changes in the deflator are due to other changes in the
economy besides commodity price changes. The most important of these
"other" changes is the change in unit labor costs. The trend of unit
labor costs has been negative since the mid-nineties, as can be seen in
the second chart, which shows the deflator and the index of unit labor
costs since 1990.</p><p>An end to Taiwan's deflation is likely to depend more
on what happens to unit labor costs than what happens to commodity
prices. Unit labor costs, F528ECU@EMERGEPR,
Consumer Price Index, N528PC@EMERGEPR
and GDP Deflator, F528NGPJ@EMERGEPR
are all found in the Haver Data Base EMERGEPR.</p>
</span>
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100323h.jpg" style="width: 312px; height: 265px;">
<img alt src="https://haver-commentaries.s3.eu-west-1.amazonaws.com/comments/100323i.jpg" style="width: 312px; height: 265px;">
<table border="0" cellspacing="0" width="100%">
<colgroup><col><col><col><col><col><col><col><col></colgroup>
<thead><tr>
<th scope="col" class="firstcol">&nbsp;</th>
<th scope="col"><b>Feb 10&nbsp;</b></th>
<th scope="col"><b>Jan 10&nbsp;</b></th>
<th scope="col"><b>Dec 09</b></th>
<th scope="col"><b>Nov 09</b></th>
<th scope="col"><b>Oct 09</b></th>
<th scope="col"><b>Sep 09</b></th>
<th scope="col"><b>Aug 09</b></th>
<th scope="col"><b>Jul 09</b></th>
</tr>
</thead>
<tbody>
<tr class="odd">
<td class="firstcol">Y/Y % Change in CPI</td>
<td>2.35</td>
<td>0.26</td>
<td>-0.25</td>
<td>-1.62</td>
<td>-1.89</td>
<td>-0.88</td>
<td>-0.82</td>
<td>-2.33</td>
</tr>
<tr>
<td class="firstcol">&nbsp;</td>
<td><b>Q4/09</b></td>
<td><b>Q3 09&nbsp;</b></td>
<td><b>Q2 09</b></td>
<td><b>Q1 09</b></td>
<td><b>Q4 08</b></td>
<td><b>Q3 08</b></td>
<td><b>Q2 08</b></td>
<td><b>Q1 08</b></td>
</tr>
<tr class="odd">
<td class="firstcol">Y/Y % Change in CPI</td>
<td>-1.26</td>
<td>-1.35</td>
<td>-085</td>
<td>-0.01</td>
<td>1.87</td>
<td>4.52</td>
<td>4.19</td>
<td>3.58</td>
</tr>
<tr class="odd">
<td class="firstcol">Y/Y % Change in
GDP Deflator</td>
<td>-2.87</td>
<td>1.80</td>
<td>0.65</td>
<td>3.28</td>
<td>-0.35</td>
<td>-524</td>
<td>-171</td>
<td>-2.26</td>
</tr>
<tr class="odd">
<td class="firstcol">GDP Deflator
(2000=100)</td>
<td>91.07</td>
<td>92.60</td>
<td>94.21</td>
<td>95.54</td>
<td>94.46</td>
<td>-0.67</td>
<td>93.49</td>
<td>92.65</td>
</tr>
<tr class="odd">
<td class="firstcol">Unit Labor Cost
(2000=100)</td>
<td>83.92</td>
<td>83.89</td>
<td>85.97</td>
<td>81.16</td>
<td>89.91</td>
<td>90.53</td>
<td>87.61</td>
<td>88.51</td>
</tr>
</tbody>
</table>
</body></html>

After some ten months of deflation measured by the year to year decline in the consumer price index, Taiwan has now experienced two months of inflation. In January the year to year change in the consumer price index was a small [...]

Measures Of Inflation/Deflation In Taiwan

Inflationary impact of surge in oil prices larger in Europe than in the US

Futures market thinks the price of oil will recede significantly over the next six months

Recent pickup in US defense orders could help support overall growth ahead

Cost of transporting crude oil has soared to series high

Market-based inflation expectations have not yet reflected recent surge in oil prices

Global equity markets are fearing a major economic disruption from soaring oil prices

Is recent drop in sentiment signaling softer growth ahead?

With the Iran conflict, geopolitical risk has soared to alarming levels

Soaring AI-related investment in US underpinning strong contribution of business spending to overall growth

AI-related outperformance of IP in Advanced Asia ex Japan

Resilient US economy pushing up Blue Chip 2026 outlook

US and China big leaders in adoption of AI models

Robust US demand for advanced technology products

China's export growth rotating away from the US

More pronounced upward revisions in countries more exposed to AI investment

Stable job openings and hiring rates point to cautious hiring

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

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

Service Health

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

London

Singapore

Tokyo

New York

Economy in Brief

Viewpoints

Contact Us

Our Data

Our Products

What We Do

Our Authors

About Us

Data News

Featured Data Additions

Resources

Release Calendars

Training Center

Webinars

Newsletters

Download Software

For Clients

Live Updates

Tian Yong Woon

In this week’s Letter, we cover the latest developments and implications of the Middle East conflict for Asia, while also making space for other important themes, including artificial intelligence (AI). The Middle East conflict remains in a no deal state coming out of the weekend, though some early Monday optimism emerged in Asian markets following Iran’s reported offer to reopen the Strait of Hormuz (chart 1). Nonetheless, as the Strait closure drags on, so too do the fiscal costs of domestic fossil fuel subsidies across Asia, which have been shown to move closely with crude oil prices (chart 2). While such measures offer direct relief by cushioning household energy costs, they remain difficult to sustain over the long haul.

Over the week, we also saw a further fraying in regional monetary policy trends, with the Philippines hiking its policy rate for the first time in about two years amid inflation concerns, while Indonesia stood pat on rates (chart 3). Investor attention is likely to remain fixed on monetary policy this week, with the Bank of Japan due to decide on policy. Expectations for an April hike have faded amid the persistent Middle East conflict, though yen weakness continues to present a source of concern (chart 4). The week also brings China’s latest PMI readings (chart 5), adding to the recent run of hard data accompanying the Q1 GDP release.

Beyond the Middle East conflict, the evolution of AI continues to demand close attention. Before geopolitical tensions took centre stage, AI was the dominant market narrative — and that enthusiasm has hardly faded. If anything, recent developments suggest the story is broadening: use cases are expanding, scalability is improving, and access is widening beyond large corporates to the mass market — increasingly spilling into the realm of physical AI. It may well be this persistent wave of optimism that is helping to underpin equity valuations, even as the geopolitical backdrop darkens (chart 6).

**The Middle East conflict**
About two months in, we remain stuck in the limbo of the US-Iran conflict, which has left the Strait of Hormuz largely closed and much of the world starved of the critical oil flows needed to power the global economy. The back and forth between the US and Iran has persisted in recent weeks, with both sides again failing to reach a peace deal over the weekend, though Monday’s news of Iran offering to reopen the Strait has revived some hope in markets. In truth, commodity and market valuations do not hinge so much on a peace deal itself, but rather on the resumption of oil flows through the Strait, something that could materialise even in the absence of a formal deal, though any agreement that includes and credibly delivers such a reopening would likely be warmly received by markets. Until then, market gyrations are likely to persist, with prices fluctuating in response to each new snippet of news. And until then, the world will continue both to be starved of, while gradually adapting to, the drip feed of oil flows emerging from the Strait.

260427T1.jpg

**The fiscal costs of the Middle East conflict**
As the Middle East conflict drags on, so too does the strain on fiscal resources across parts of Asia, as the costs of energy-related subsidy programmes continue to mount. While such programmes have an immediate, direct, and tangible impact in shielding households from surging energy costs, they are far from sustainable, particularly if oil prices remain well above targeted levels or stay elevated for an extended period. As chart 2 illustrates, the costs of these explicit subsidy programmes tend to rise closely with crude oil prices, as seen in India and Indonesia. Other measures adopted elsewhere, such as drawing down oil reserves, may be less fiscally costly, but are similarly difficult to sustain indefinitely. In both respects, the clock is ticking, and the world continues to hold its breath as the conflict drags on.

260427T2.jpg

**The latest central bank responses to the conflict**
Over the past week, Asia saw two central bank decisions. The Philippines’ (BSP) opted to deliver its first rate hike in about two years, while Indonesia’s (BI) chose to stand pat on policy rates and instead committed to stepped up FX intervention (chart 3). This latest round of decisions points to a further fraying of what had been a broad regional monetary policy consensus, namely that central banks would delay additional easing while maintaining a high bar for outright tightening. Domestic considerations, however, remain paramount. In the Philippines’ case, the central bank has moved to rein in inflation, which is already showing notable signs of price pass through stemming from disruptions linked to the Strait of Hormuz. That said, BSP is not the first in the region to buck the reluctance to tighten. Singapore’s central bank had already tightened policy in mid-April, albeit through its own distinct framework, given its use of the exchange rate rather than policy rates as the primary channel for monetary policy.

260427T3.jpg

**The week ahead**
Looking to the week ahead, a major central bank decision looms in Japan. Market expectations for the Bank of Japan to deliver a rate hike at its April meeting have ebbed amid the persistence of the Middle East conflict, to which Japan remains particularly vulnerable given its reliance on oil imports flowing through the Strait of Hormuz. At the same time, inflation in Japan has yet to become a major concern, with recent readings having picked up but not yet entering troubling territory. One potential source of concern, however, lies with the Japanese yen, which has remained on a weakening trend since early last year (chart 4). That depreciation has been one of the key arguments underpinning calls for further rate hikes.

260427T4.jpg

The week also brings China’s latest PMIs into focus. March saw a divergence between China’s official PMI readings, which improved, and the unofficial readings from RatingDog, which instead pulled back. Nonetheless, both official and unofficial gauges remained in expansionary territory (chart 5), with investors now watching closely to see whether that resilience can be sustained amid ongoing stresses from the Middle East, or whether offsetting drivers can continue to keep Chinese business sentiment and prospects buoyant.

260427T5.jpg

**Beyond the strait**
Moving beyond the Middle East conflict, a whole host of developments continue to unfold globally, many of which have in fact helped offset some of the pessimism wrought by the Strait’s chokehold. One such development is artificial intelligence (AI), which had dominated headlines before the outbreak of the conflict and continues to advance at breakneck pace. AI capabilities are still rapidly evolving, while practical applications, such as physical AI embodied in humanoid robots, are beginning to show broader and stronger use cases. Production of such robots is also becoming increasingly scalable and within reach not just for industrial complexes and healthcare, but for the mass market as well. It is perhaps growing optimism around these prospects that has helped keep equity valuations buoyant, even in the face of the festering conflict in the Middle East. Moreover, while concerns over AI-driven job displacement persist, new opportunities are emerging as well, particularly for AI adopters, with a growing share of job postings in Western economies increasingly referencing AI-related skills, as shown in chart 6.

260427T6.jpg

Asia

Economic Letter from Asia: Not Just About the Strait

260424E.jpg

The onset of the war in Iran appears to have hit the German economy extremely hard as the Ifo survey shows very substantial and broad-based decline across its survey in April. The Ifo survey features readings for five sectors as well as an aggregate reading, and it surveys them for climate, current conditions, and expectations. The decline in the Ifo survey is present for all three concepts and across all five sectors, marking the weakening in April as a highly significant and extremely disturbing development. Only manufacturing in the current conditions survey escapes a month-to-month decline.

**The Ifo sequences**: The **climate** reading fell both overall and across each of the five sectors. **Current conditions** declined for the overall and for four of the five sectors, with manufacturing the sole exception. **Expectations** declined for the overall and for all sectors. Several of the sector declines were for a very substantial magnitude, especially when compared to historic changes in these indexes.

**Monthly changes in readings—severe broad deterioration**
The month-to-month change in the climate reading has weakened more month-to-month 19% of the time. That overall result, however, is boosted by manufacturing where the monthly change has been weaker 35% of the time (on data back to 2011). However, all other sectors have seen climate weaker m/m only 2.3% to 6.3% of the time! The current situation readings weakened, with the headline weakening more m/m 11% of the time. This was boosted by manufacturing, the only sector that improved on the month; its ranking on change was in its 85th percentile—quite good and truly stand-alone good news. The other current changes by sector ranged from construction being weaker 1.7% of the time, to retailing that has been weaker about 30% of the time in terms of m/m changes. Expectation changes were uniformly terrible, with the headline drop weaker only 6.3% of the time and sector change month-to-month weaker between 9% and 1.7% of the time. The monthly weakening was uniform and substantial. I document it with these calculations, but you can also see it on the chart above.

**Climate**: The bottom line is that the all-sector index for climate fell to -20.3 in April from -18 in March, placing it at a 10.5 percentile standing on data since 1993. The sector ranking is the highest for construction with a 42.2 percentile standing and the weakness for services at a 1.1 percentile standing—weaker than the table reading nearly 99% of the time. In terms of percentile standing levels or monthly changes, conditions are closing in on grim.

**Current conditions**: Current conditions saw the all-sector index slip to -5.3 in April from -2.4 in March. The headline ranking stands at a 9.8 percentile mark, making it—like the climate reading—weaker than its current reading only about 10% of the time. The strongest reading under current conditions is for construction which has a 60.6 percentile standing; it is the only ranking in the table above its historic median. Manufacturing, the only sector in the survey that improved month-to-month, has a 22.5 percentile standing, while services record the weakest percentile standing under current conditions, at an 8.4 percentile standing.

**Expectations:** The all-sector index for expectations fell to -25.3 in April from -19.9 in March, placing it at a 6.3 percentile standing. The percentile standings across sectors range from a high of 9.5% for manufacturing to a low of 1.5% for retailing. Up until earlier this year, the Ifo was showing signs of improvement; however, all of that has simply collapsed in the last month. Weakness is across economic concepts and sectors, as documented above. For reference, the table also gives a separate set of rankings on where the various indexes stand since the invasion of Ukraine, since that was another marked event that drove the index, that had been improving after Covid, down to lower levels.  Ranked even on this reduced scale looking at conditions only since the invasion of Ukraine, when conditions have generally been weaker, the current rankings across the Ifo survey remained extremely weak. This is a very disturbing survey for the German economy.

260424.jpg

Germany

German Ifo Plunges Everywhere

Andrew Cates

**Energy shock lifts inflation, trims growth**
The IMF’s latest WEO revisions for 2026 broadly reflect the classic stagflationary impact of the recent Middle East energy shock, with growth downgraded and inflation revised higher across most major economies. Higher energy prices act as a tax on real incomes while simultaneously pushing up costs. That said, the picture is not uniform: a number of economies—notably the US, China and India—have seen growth upgrades, reflecting stronger-than-expected momentum so far in 2026. By contrast, the UK stands out at the stagflationary extreme, combining one of the largest growth downgrades with a relatively strong inflation uplift—consistent with its weaker underlying momentum, greater energy sensitivity and more persistent domestic inflation dynamics. More broadly, while the global revisions remain modest—pointing to resilience in activity—the message is that disinflation is no longer a smooth glide back to target but increasingly contingent on energy prices and geopolitical developments.

260423Z1.jpg

**Markets largely shrug off rising economic pessimism**
Notwithstanding a more downbeat assessment from economists—including the IMF’s stagflationary tilt to the outlook—there has been remarkably little follow-through into financial markets. Measures of systemic stress in both the US and UK remain low by historical standards, suggesting that investors are, for now, largely looking through the Middle East conflict. There are several possible explanations: corporate profits remain resilient, the AI-driven investment narrative continues to dominate market thinking, and markets may be assuming that any energy shock will be temporary and contained. In effect, investors appear to be pricing a benign baseline in which geopolitical risks do not materially disrupt growth, inflation expectations or policy. The UK is a partial exception, with a somewhat more visible uptick in stress, which aligns more closely with the IMF’s more challenging growth-inflation trade-off and the economy’s greater sensitivity to energy prices.

260423Z2.jpg

**Volatility falls despite deteriorating growth surprises**
Market optimism is also increasingly at odds with the incoming data flow. Typically, equity volatility declines when growth surprises are positive and inflation surprises are benign. However, the recent pattern has broken that relationship. Growth surprises across the G10 have turned increasingly negative (our series is inverted in the chart below), yet volatility has continued to fall. In other words, markets are becoming less sensitive to weakening macro data, continuing to price a benign outlook even as the data deteriorate. This divergence reinforces the broader theme: investors are, for now, looking through both geopolitical risks and softer economic momentum, placing greater weight on resilience in earnings, the AI-driven narrative and the assumption that policy will remain supportive.

260423Z3.jpg

**Inflation Nowcasts Have Jumped**
Incoming data suggest that headline inflation has moved higher in recent weeks, broadly in line with expectations given the rise in energy prices following the Middle East shock. Nowcasts for CPI across the major economies show a clear rebound in March and April from the lows seen at the start of 2026, with the move occurring in a relatively synchronised fashion. This reinforces the view that the recent pickup in inflation is being driven primarily by a common external factor—energy.

260423Z4.jpg

**Energy shock not yet feeding into underlying inflation**
However, the detailed breakdown of March inflation outcomes suggests that this remains, for now, a largely headline-driven phenomenon. While headline CPI prints were firm across most economies, core inflation—stripping out energy and food—was more subdued and in some cases weaker. This indicates that there has been very limited pass-through from higher energy prices into broader goods and services inflation at this early stage. In other words, the shock is still being absorbed rather than propagated. That distinction is critical for policy and markets alike: as long as second-round effects remain contained, central banks may be able to look through the near-term rise in inflation, even as headline rates move higher.

260423Z5.jpg

**Inflation Expectations Rising as Growth Sentiment Falters**
It remains early days, and much will hinge on how inflation expectations evolve from here. The latest ZEW survey for Germany already conveys the hallmarks of a classic stagflationary shock, with macroeconomic expectations weakening even as inflation expectations have ratcheted sharply higher. This shift is important: while the recent rise in headline inflation has so far shown limited pass-through into core, a sustained increase in expectations would raise the risk of second-round effects and make the inflation process more persistent. In that sense, the ZEW data highlight the key fault line in the current environment—whether the energy-driven shock remains contained, or begins to embed itself more broadly through expectations and pricing behaviour.

260423Z6.jpg

Financial markets have remained notably calm in recent weeks despite rising geopolitical tensions in the Middle East, a more downbeat macroeconomic narrative and elevated uncertainty. Measures of financial stress and volatility remain low, and equity markets continue to look through both the conflict and softer data. That resilience sits alongside a more nuanced macro backdrop. The IMF’s latest WEO revisions point to a classic stagflationary energy shock—growth downgraded and inflation revised higher—although the global impact remains modest and uneven, with some economies still benefiting from stronger momentum (chart 1). At the same time, market pricing appears increasingly detached from the data flow, with volatility declining even as growth surprises have turned more negative relative to inflation (charts 2 and 3). Incoming inflation data reinforce the idea of a largely headline-driven shock, with nowcasts rising in line with higher energy prices but only limited pass-through into core inflation so far (charts 4 and 5). However, it remains early days. Survey evidence, such as the latest ZEW release, suggests that inflation expectations may already be responding in a more concerning way, with a marked rise alongside weakening growth sentiment (chart 6). Taken together, the key question for markets is whether this remains a contained, energy-driven shock that can be looked through—or whether it begins to embed more persistently via expectations, forcing a reassessment of the currently benign outlook.

<iframe data-testid="embed-iframe" style="border-radius:12px" src="https://open.spotify.com/embed/episode/44A12ktUaoJGHZG7pEVcul?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: Risks Build, Markets Shrug

Sandy Batten

260423F8.jpg

260423G8.jpg

The National Activity Index published by the Federal Reserve Bank of Chicago (CFNAI) slipped to -0.20 in March from an upwardly revised +0.03 in February (previously (-0.11). This is the lowest monthly reading since last November. Smoothing out the monthly volatility, the index's three-month moving average (CFNAI-MA3) declined to -0.03 in March from an upwardly revised +0.03 in February (previously -0.01).

This index is expressed in standard deviation units from zero (with a value of zero defined as trend real GDP growth). Research at the FRB Chicago indicates that readings on the 3-month average of -0.70 or below are consistent with the economy being in a recession. Therefore, even though the March reading on the 3-month average was negative, it indicates that the US economy is still growing, just slightly slower than trend, and is well away from recessionary conditions. The 3-month average would be much deeper in negative territory if the economy was at risk of contracting.

The National Activity Index is a composite of 85 economic indicators, grouped into four major categories: production and income; employment, unemployment, and hours worked; personal consumption and housing; sales, orders, and inventories. Three of the four broad categories of indicators used to construct the index decreased from February, and three categories made negative contributions in March. Production-related indicators contributed –0.20 to the CFNAI in March, down from +0.13 in February. The sales, orders, and inventories category's contribution to the CFNAI was –0.01 in March, down from +0.05 in February. Employment-related indicators contributed +0.02 to the CFNAI in March, up from –0.15 in February. The personal consumption and housing category's contribution to the CFNAI was –0.01 in March, down from a neutral value in February.

The CFNAI Diffusion Index, which measures the breadth of the change in the component series and is also a three-month moving average, increased to –0.04 in March from –0.08 in February. This is the highest reading since February 2025. A reading of zero indicates that all of the indicators are growing at their long-term average. If all of the underlying indicators in a given month are below their long-run averages, the diffusion index will equal -1. If all of the indicators are above their long-run averages, it will equal +1. Thirty-four of the 85 individual indicators made positive contributions to the CFNAI in March, while 51 made negative contributions. Forty-three indicators improved from February to March, while 40 indicators deteriorated and two were unchanged. Of the indicators that improved, 16 made negative contributions.

These figures are available in Haver's **SURVEYS** database.

- The monthly reading fell to -0.20 in March from an upwardly revised +0.03 in February.
- The three-month average slipped from +0.03 to -0.03.
- Despite the slip in March, the index points to near-trend economic growth and is well above recession territory.

Chicago Fed National Activity Index Slipped in March

Kathleen Stephansen, CBE

260423A1.jpg

260423B1.jpg

Initial claims for unemployment insurance rose by 6,000 to 214,000 in the week ending April 18, from 208,000 in the week ending April 11, revised from 207,000. The four-week average rose 750 to 210,750 in the week ending April 18, from 210,000 the April 11 week, revised from 209,750. The Action Economics/Haver Analytics Survey looked for 210,000 claims to have been filed.

The total number of unemployment insurance beneficiaries—also known as “continuing claims”—rose by 12,000 to 1.821 million in the week ending April 11, from 1.809 million in the week ending April 4. The four-week moving average rose to 1.812 million in the latest week from 1.811 million in the March 28 week. The insured unemployment rate remained at 1.2% in the week of April 11. It has remained at that level since the week of November 29, 2025.

The insured unemployment rate varied greatly across individual states and territories. In the week ending April 4, the highest unemployment rates were in New Jersey (2.51%), Massachusetts (2.37%), Rhode Island (2.31%), Washington (2.25%), Minnesota (2.11%), and California (2.02%). The lowest rates were in Florida (0.30%), Louisiana (0.31%), Arkansas (0.35%), Alabama (0.36%), North Carolina (0.39%), Tennessee (0.46%), South Dakota (0.47%), Kansas and Virginia (both 0.49%). Rates in other notable states include New York (1.92%), Illinois (1.82%), Pennsylvania (1.52%), and Texas (1.04%). These state data are not seasonally adjusted.

Data on weekly unemployment claims are from the Department of Labor itself, not the Bureau of Labor Statistics. They begin in 1967 and are contained in Haver’s **WEEKLY** database and summarized monthly in **USECON**. Data for individual states are in **REGIONW** back to December 1986.

260423C1.jpg

260423D1.jpg

- New claims rose by 6,000 to 214,000.
- Continuing claims rose by 12,000 to 1.821 million.
- The insured unemployment rate remained at 1.2%.


Economy in Brief: 2010

Jump to: