agenda 4

Makroökonomische Daten – 04 – 08 Juli 2011 (Englisch)

In the Euro area, the ECB is expected to announce a second rate hike to 1.50%. The few economic data due out (relating to May) should show .    


          a fall in producer prices in the Euro area (the first in 18 months) and a collapse in retail sales; the industry indicators in Germany might be mixed, with output expected to bounce and orders to fall; industrial production in Italy might have stopped expanding after the positive surprises of the previous three months.
          The coming week, shortened by the 4 July holiday, will bring few important figures in the United States. The June employment report should show slightly more robust non-farm payrolls growth than in May, accompanied by a fall in the unemployment rate. The non-manufacturing ISM is expected to be down slightly in June, whilst remaining in expansionary territory.
          Monday 4 July
          Euro Area

          * Producer prices are expected to be down -0.2% mom in May, marking the first dip in over 18 months. Year-on-year, PPI would cool to 6.2% from 6.7%. Based on the recent trend in international commodity prices and indications from firms in the surveys, the cooling of the PPI might continue over the coming months.
          United States
          * Markets closed for holiday.
          Tuesday 5 July
          Euro Area

          * Based on the data from Germany, Spain and France, we expect Euro area retail sales to be down heavily by -1.8% mom in May, after +0.9% mom in April. Without a bounce in June, sales would be on track for a -0.8% qoq contraction in 2Q11, after broad stagnation in the previous two quarters. In short, the data confirm that the feeble real disposable income dynamic continues to hold back household consumption growth.
          * Germany. Factory orders are expected to be down -0.2% mom in May, following the volatility seen in the previous two months (-2.7% in March, +2.8% in April). Both the IFO and the PMI showed a downtrend in the view on orders among firms in the spring.
          Wednesday 6 July
          Euro Area

          * Germany. Industrial production might bounce by 0.8% mom in May after April’s unexpected fall (-0.6% mom). The indications from the sentiment surveys are still consistent with ongoing expansion. In any event, as of 2Q11 output growth might moderate to a pace of just over 1% (less than half that seen year-end 2010/start 2011).
          United States
          * The non-manufacturing ISM should correct to 54 in June after rising to 54.6 in May (from 52.8 in April). In the May survey, the breakdown was positive, with new orders climbing to 56.8 from 52.7 in April. Employment also rose to 54 from 51.9. The services sector has not been affected by the slowdown in manufacturing caused by the Japanese earthquake and has retained a higher level of confidence. Nonetheless, the Richmond Fed services survey recorded a deterioration in virtually all components in June, forced down mainly by the retail sector, and this suggests a correction in the ISM.
          Thursday 7 July
          Euro Area

          * The ECB will raise rates by 25bp and signal further adjustment is warranted as risks to price stability remain on the upside. We continue to see rates at 2% by march 2012. Markets expect the refi rate at 1,75% by year end. We believe the ECB will reiterate its position on Greek debt roolover.
          United States
          * The consensus ADP estimate of new private non-farm payrolls in June is +60k vs. +38k in May.

          Friday 8 July
          Euro Area

          * Italy. Industrial production might have stopped expanding in May after the strong gains (averaging over 1%) in the previous three months. Our estimate is for output to be steady quarter-on-quarter and slowing, year-on-year adjusted, to 2.8% from 3.7% before (whereas, not adjusted for working days, output would bounce to 6% from -0.1% yoy). In any case, output would be on track for substantial growth in the current quarter, after two slightly negative quarters but, given the less bullish mood among businesses, industrial activity might moderate in the third quarter.

          United States

          * The June employment report should show a moderate improvement from May. New non-farm payrolls should total 110k, vs. the modest 54k recorded in May. Private sector payrolls should be up 135k, netted of job losses in the public sector, concentrated at state and local level.
          The manufacturing sector should show a recovery from the 5k drop in May, thanks to the gradual normalisation of activity in the sector. Payrolls in the retail trade should also be up again after shrinking by -9k in May: the May data were partly skewed to the negative by seasonal effects due to the Easter holiday. The participation rate should remain steady at 64.2%, for the sixth straight month. The unemployment rate should remain steady at 9.1%.
          Hourly wages should moderate their growth to +0.1% mom, after +0.3% mom in May.

          Appendix
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