agenda 4

Makroökonomische Daten – 25 – 29 April 2011 (Englisch)

In the Euro area, the fuel price increases might drive inflation to 2.8% yoy from 2.7% yoy. The year-on-year CPI should rise to 2.7% yoy (from 2.3% yoy) in Germany and remain steady at 2.8% yoy in Italiy and at 3.6% yoy in Spain. ....         


          Retail sales should be down 0.3% mom in France but up slightly in Germany. The EU Commission index of economic confidence should slip to 107.0 on the dip in sentiment in industry. In Germany, the jobless total might fall 15k in April, leaving the unemployment rate at 7.1%. M3 should accelerate to 2.2% yoy from 2.0% yoy, with loans to non-financial firms in particular up slightly. 

          In the United States, the week’s main event is the FOMC meeting which will be followed by the first press conference in the Fed’s history. The FOMC should signal stabilisation of the monetary stimulus, with a pause ahead of the reversal. The Chicago PMI should be down slightly in April on the effects of the earthquake in Japan, despite remaining high; household confidence should pick up after the steep fall in March. The 1Q11 GDP growth estimate should confirm the expected slowdown, held back by public and private consumption and a negative contribution from international trade. Durable goods orders and new home sales should rebound in March after correcting in February. 

          Monday 25 April

          United States

          New home sales are expected to rise to 280k in March from 250k in February. The growth expected in March follows two very negative months and does not signal a reversal in the flat trend in the sector. The NAHB index of confidence rose in March, but fell back in April on a correction in current and future sales. Unsold home inventories should fall from 8.9 months in February, returning to the average for the previous three months (7.5 months). The prices of  homes sold should also remain weak.

          Tuesday 26 April

          Euro area

          The release of the public finance data for 2010 will finalise the improvement in the public finance balances vs. the targets set in the Stability Programme. Our estimate for the deficit GDP ratio is -6.1% vs. -6.3% before. The debt is expected to rise to 83.6% from 79.2%.

          United States

          Household confidence as measured by the Conference Board should rise to 65 in April from 63.5 in March. In March the index fell by 8.6 points, in line with the indications of the other indices. In April the preliminary reading of the Univ. of Michigan index and the Bloomberg weekly indicator rose, though without regaining the February levels.

          Wednesday 27 April

          Euro area

          The ECB publishes the Bank Lending Survey which will give indications on any improvements in lending terms in the Euro area, notably to households. In the January survey lending standards for firms were neutral while banks reported applying tighter terms to mortgages due to the increased risk.

          Germany. The Laender data should be consistent with consumer price growth of 0.2% on the national index and 0.3% mom harmonised. Inflation on the national measure should accelerate to 2.4% yoy from 2.1% yoy and to 2.7% yoy from 2.3% yoy harmonised. The month-on-month dynamic is impacted by an adverse base effect and the fuel price hikes. Italy. Consumer confidence might rise to 105.5 in April from 105.2 in March. Employment concerns might diminish further but confidence will be held back by fears of further price increases.

          United States

          Durable goods orders are expected to be up 2.8% mom in March, after -0.6% mom in February. In transportation, orders should be up not just in civil aviation, but also in autos, before the supply-side bottlenecks stemming from the earthquake in Japan. Orders ex transportation should be up 2.3% mom. Deliveries and inventories should also pick up.

          The FOMC meeting should end with rates on hold at 0.25% and the announcement of the continuation of Treasuries purchases through to completion of the programme announced in November (USD600Bn). The press conference that will follow the meeting (see editorial in this issue) will probably signal that the end of the Treasuries purchasing programme will be followed by a pause, after which a gradual reversal will be set in motion. The macroeconomic projections will be published with the press statement and no longer three weeks later with the minutes, and they will provide the justification behind the indication that the reversal is not urgent.

          Thursday 28 April

          Euro area

          Germany. The sharp acceleration in industry should ensure another improvement in the German labour market. We expect the April jobless total to be down 15k. The unemployment rate should be steady at 7.1%, while there is scope for further falls before the end of summer.

          France. Retail sales should fall slightly to -0.3% mom in March vs. +0.9% mom in February. Apparel and other manufactured goods purchases should correct. Auto sales might be up again. If confirmed, the figure would leave sales up 1.3% qoq vs. December.

          Italy. Manufacturing business confidence might be little changed at 103.7 in April, vs. 103.8 in March. Confidence remains consistent with buoyant industrial activity, although in recent months the real data have been much more disappointing than the confidence surveys.

          United States

          The first estimate of 1Q11 GDP should confirm expectations of a slowdown in growth, probably short-lived, at the start of the year. Growth should be 2% qoq ann., vs. 3.1% qoqann. in 4Q10, showing curb on consumption, investments and public spending, a very negative contribution from the foreign channel and a scaling back of inventories growth.

          Consumption should be up 2.5% qoq ann., after +4% qoq ann. in 4Q10, assuming an upturn in service spending vs. the weakness seen in the first two months of the quarter. Public spending should be down sharply, partly following a protracted period of provisional terms extending through to mid-April. Residential and non-residential construction fell at the start of the quarter partly on account of weather conditions, holding back growth more than expected. Net exports should make a negative contribution of around 0.5 pp. Inventories should make a positive contribution to growth, offsetting net exports. Final domestic demand should pick up in 2Q11.

          Friday 29 April

          Euro area

          The EU Commission index of economic confidence should fall to 107 in April from 107.3, mainly concentrated in industry according to the national surveys. The advance estimate suggested a decline in confidence among households too. Sentiment in services should be up slightly.

          The preliminary estimate should show Euro area inflation at 2.8% yoy in April vs. 2.7 % yoy before. This should be a high, although significant falls from the current levels will only be seen around year-end. Upward pressures continue to come from fuel and commodity prices and for now the underlying dynamic is under control.

          M3 should continue to accelerate to 2.2% yoy from 2.0% yoy. The three-month moving avg. is estimated at 1.9% yoy vs. 1.7% yoy before. February saw large inflows of repos, due in turn to guaranteed interbank trading via central counterparties classified as non-monetary financial intermediaries other than insurance companies and pension funds (AIF). The acceleration in M3 is due to the slope of the yield curve which reduces the appeal of holding the assets included in M3. We expect confirmation of a modest acceleration in business and household loans.

          Italy. Consumer prices should be up 0.4% mom. Inflation should remain at 2.5% yoy on the national index and at 2.8% yoy harmonised. In the month, the fuel price hikes will be joined by increases in tariffs (electricity +3.9%, gas +2%). Although the oil price should ease back from the recent highs, inflation might remain around the current level through to late autumn at least.

          Italy. The provisional estimates for March might show unemployment steady at 8.4%. The recent highs (8.7% in October 2010) may not be topped and, based on the lagged correlation with the cycle, the labour market might first stabilise and then start a gradual uptrend.

          Germany. Retail sales ex auto in March should make up (by 0.2% mom) some of the previous month’s fall (-0.4% mom). If confirmed, the figure would leave sales up 1.0% qoq. Auto sales grew by around 5% according to the registration figures. Total sales should thus be up 1.0% qoq in March vs. 0.1% qoq at end-2010. Household consumption might therefore be up by at least 0.4% qoq at start-2011.

          United States

          Personal spending should be up 0.5% mom in March, after +0.7% mom in February. In March the contribution of prices to the nominal change will be predominant, showing a real change confined to 0.1% mom, with a contraction in durable goods driven by the correction in auto. Retail sales showed a modest dynamic in real terms. Personal income is expected to be up 0.4% mom on the back of the growth in payrolls and hours worked in March, despite weak wages. The saving rate should fall, slipping to 5.7% from 5.8 % in February.

          The Chicago PMI should fall to 69 in April from 70.6 in March, sticking close to the all-time series highs (inception 1983). The March survey was generally positive with all components at high levels, though slightly shy of the February values. One risk factor with the April survey stems from the production stoppage at Japanese producer factories due to the earthquake.  The manufacturing sector data nonetheless remain very strong, as indicated by the Beige Book, which is why any knock-on effects from the earthquake will be limited and shot-lived.

          Household confidence as measured by the Univ. of Michigan in April (final) should confirm the preliminary figure which showed a slight improvement to 69.6 from 67.5 in March. The final index for April should rise to 70.

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