Weekly Macroeconomic Update WEEKLY SUMMARY

Transcription

1 October 10 17, 2015 Weekly Macroeconomic Update WEEKLY SUMMARY WEEKLY MACROECONOMIC UPDATE US Inflation- measuring indicators point to sustained deflationary pressures in the US in September, with a month- over- month decline of 0.2 in headline inflation and a drop in the Producer Price Index (PPI). Retail sales increased by only 0.1 month over month, showing the effects of a drop in gasoline prices. Industrial production decreased by a further 0.2 in September. Europe In the three months ending August 2015, 5.6 of the UK labor force was unemployed, up 20 basis points from the previous quarter. The UK Consumer Price Index (CPI) turned negative again, falling to (0.1) in September. The PPI in the UK, which tracks the price of goods traded by UK manufacturers, continued to fall for the year through September. The overall prices of manufactured goods fell by 1.8. In Germany, the Wholesale Price Index (WPI) decreased by 1.8 year over year in September. The CPI in Germany was flat year over year in September. In France, the prices of frequently purchased goods in hypermarkets and supermarkets fell by 0.6 year over year in September. In September, the CPI in France was flat year over year. LatAm In August, industrial production in Mexico increased modestly; the index recorded a 0.2 monthly gain and a 0.7 year- over- year increase. GDP In Brazil, the Index of Economic Activity dropped to its lowest level in over 20 months in August, highlighting the deteriorating economic conditions in the country. Retail sales in Brazil were down 6.9 year over year for the same month. GDP Growth Rate: QoQ Change 3Q Q Q Q 2015 US UK Germany France Mexico Brazil Source: OECD 1

2 MOVERS US Headline inflation declined by 0.2 month over month in September, standing unchanged on a 12- month basis. The decline is attributed to a 9 drop in gasoline prices in the month. Core inflation increased by 0.2 month over and by 1.9 year over year. Figure 1. US CPI: YoY Change September 2012 September Core CPI CPI () Sep- 12 Dec- 12 Mar- 13 Jun- 13 Retail sales increased modestly, by 0.1 month over month and by 2.4 year over year. Retail sales excluding autos increased by 1.7 month over month and by 0.8 year over year. The decline in gasoline prices is affecting total retail sales growth; however, it should have a positive impact on consumer spending. Figure 2. US Retail Sales (Seasonally Adjusted): YoY Change September 2013 September Total Ex Auto Motor Vehicles & Parts Dealers Industrial production declined by 0.2 in September, bringing down year- over- year growth in the index to 0.4. The declining trend in production, which started in December 2014, has resumed following a slight increase midsummer. Capacity utilization decreased to Figure 3. US Industrial Production Sept Sept Sep- 12 Dec- 12 Mar- 13 Jun MoM Change (leh) YoY Change (right) The PPI registered its first monthly decline since April, dropping by month over month. Year over year, the index continued to register negative growth, falling by in September. The weakness in the index points to sustained deflationary pressures in the economy. Figure 4. US PPI September 2012 September Sep- 12 Dec- 12 Mar- 13 Jun MoM Change (leh) YoY Change (right) Source: Bloomberg/Federal Reserve Bank of St. Louis 2

3 MOVERS UK In the three months ending August 2015, 5.6 of the UK labor force was unemployed, up 20 basis points from the previous quarter. Over 1.84 million people aged 16 and over were out of work between June and August. Figure 5. UK Quarterly Unemployment Rate June 2014 August Jun- Aug 2014 Sep- Nov 2014 Dec- Feb 2015 Mar- May 2015 Jun- Aug 2015 Source: Eurostat/Office for National Statistics UK CPI turned negative again in September, falling to (0.1). The CPI has been 0 or close to it for most of the year. The last time it was negative was in April. With earnings on the rise, the fall in prices is boosting consumers spending power. Figure 6. UK CPI: YoY Change September 2014 September Source: Eurostat/Office for National Statistics The PPI, which tracks the price of goods traded by UK manufacturers, continued to fall for the year through September. Crude oil continued to drive down input prices, which resulted in a drop in output prices. The overall prices of manufactured goods fell by 1.8. Output of manufactured goods, excluding the more volatile food, beverages, tobacco and petroleum products, rose by 0.2. Figure 7. UK PPI: YoY Change September 2014 September Output of manufactured products Source: Eurostat/Office for National Statistics 3

4 MOVERS GERMANY AND FRANCE In September, the index of selling prices in the wholesale trade in Germany decreased by 1.8 year over year. Selling prices of household goods in the wholesale trade increased by 1.6 year over year in September. The biggest year- over- year drop in selling prices in the wholesale trade was in solid, liquid, and gaseous fuels and related products, at (17.7). Figure 8. Germany WPI: YoY Change September 2013 September Nov- 13 Jan- 14 May- 14 Jul- 14 In September, German CPI was flat, at 0 year over year. Food prices rose by 0.9 and clothing prices by 1.3, while electricity prices declined by 0.7 year over year in September. Figure 9. Germany CPI: YoY Change September 2013 September Nov- 13 Jan- 14 May- 14 Jul- 14 In France, the prices of frequently purchased goods in hypermarkets and supermarkets fell by 0.6 year over year in September. Prices of food products went down by 0.4 year over year, while beverages went up by 0.1. Figure 10. France Index of Frequently Purchased Goods in Hypermarkets and Supermarkets: YoY Change September 2013 September Nov- 13 Jan- 14 May- 14 Jul- 14 The French CPI was flat year over year in September, as it was in August. Figure 11. France CPI: YoY Change September 2013 September Food prices increased by 0.9 year over year, while clothing and footwear prices declined by 0.9. Automotive fuel prices decreased by 14.3 year over year in September Nov- 13 Jan- 14 May- 14 Jul- 14 Source: Eurostat/Statistisches Bundesamt/INSEE 4

5 MOVERS MEXICO AND BRAZIL Mexico s industrial production index was up 0.2 month over month in August and 0.7 year over year. The increase was mainly driven by gains in manufacturing and utilities. Figure 12. Mexico Industrial Production Index February 2014 August () () Feb- 14 Apr- 14 Aug- 14 MoM Change (leh) YoY Change (right) Economic activity in Brazil continued to deteriorate in August. The Index of Economic Activity, tracked by the Central Bank of Brazil, dropped to 140, its lowest level in over 20 months. Figure 13. Brazil Index of Economic Activity February 2014 August Feb- 14 Apr- 14 Aug- 14 Retail sales in Brazil in August decreased by 0.9 month over month and by 6.9 year over year. Retail sales were down for an eighth straight month amid low consumer confidence and high unemployment. Figure 14. Brazil Retail Sales: YoY Change August 2013 August Aug- 13 Oct- 13 Feb- 14 Apr- 14 Aug- 14 Source: Banco Central do Brasil/Instituto Brasileiro de Geografia e Estatística/Instituto Nacional de Estadistica y Geografia 5

6 US MARKET DATA US Government Bond Yields (Percent) Friday 1 Week US Markets WEEKLY MACROECONOMIC UPDATE Friday 1 Week 2- Year Treasury Dow Jones 17, , , Year Treasury S&P 500 2, , , Year Treasury Dow Jones Industrial Average and S&P 500 Indexes US Regular Gas Price (USD) 18,500 18,000 17,500 17,000 16,500 16,000 15,500 15,000 14,500 14,000 Dow Jones Ind. Avg. (leh) S&P 500 Index (right) 2,200 2,150 2,100 2,050 2,000 1,950 1,900 1,850 1,800 1,750 1,700 $3.50 $3.25 $3.00 $2.75 $2.50 $2.25 $ /12/2015 $2.337 Source: Bloomberg/US Energy Information Administration EUROPE MARKET DATA Government Bond Yields (Percent) Friday UK 2- Year UK 5- Year FTSE 100 Index 7,500 7,000 6,500 6,378 Germany 2- Year Germany 5- Year France 2- Year France 5- Year CAC 40 Index 6,000 5,500 DAX Index 5,500 12,500 5,000 4,500 4,703 11,500 10,500 10,104 4,000 9,500 3,500 8,500 Source: Investing.com/S&P Capital IQ/FT.com 6

7 LATIN AMERICA MARKET DATA Government Bond Yields (Percent) Friday 1 Week Markets WEEKLY MACROECONOMIC UPDATE Friday 1 Week Mexico 5- Year IPC Mexico 44, , , Mexico 10- Year Bovespa Brazil 47, , , Brazil 5- Year Brazil 10- Year Mexico: IPC Index 46,000 45,000 44,000 43,000 42, ,364 Brazil: Bovespa Index 62,000 58,000 54,000 50,000 47,236 41,000 46,000 40,000 42,000 Source: Investing.com/Yahoo Finance Macro Calendar Country/Region Date Release Period Covered Brazil October 21, 2015 Mid- Month Inflation October 2015 Mexico October 21, 2015 Retail Sales August 2015 Brazil October 22, 2015 Unemployment Rate September 2015 US October 22, 2015 Existing Home Sales September 2015 UK October 22, 2015 Retail Sales September 2015 France October 22, 2015 Monthly Survey of Retailing October 2015 France October 22, 2015 Business Climate Indicator October 2015 US October 22, 2015 New Home Sales October 2015 Mexico October 22, 2015 Mid- Month Inflation October 2015 US October 22, 2015 GDP 3Q 2015 Mexico Jobless Rate September 2015 France October 28, 2015 Housing Starts September 2015 France October 28, 2015 Consumer Confidence October 2015 Germany October 29, 2015 Unemployment October 2015 Germany October 29, 2015 Consumer Price Index October 2015 France October 29, 2015 Consumer Spending September 2015 US October 30, 2015 Personal Income and Outlays October

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