Economic data weak in US and UK, better elsewhere in Europe and Asia

Reuters rounds up the news on the US economy yesterday, including that on fourth quarter GDP:

The U.S. economy grew at an upwardly revised but still-weak 1.6 percent annual rate in the fourth quarter... The revised fourth-quarter data on U.S. gross domestic product reflected a faster pace of capital spending by government and business, and a bigger build up of inventories than initially estimated... Growth for all of 2005, however, was unrevised at 3.5 percent...

Inflation indices were little changed. A core price measure that strips out food and energy costs increased at a 2.1 percent rate, down from the 2.2 percent pace reported a month ago.

... existing home sales:

Sales of existing homes fell 2.8 percent last month to a 6.56 million unit annual rate, the National Association of Realtors said. At that pace, the inventory of unsold homes marked a 5.3 months' supply, the highest since August 1998...

Home prices, however, have been more resilient. The median price for an existing home rose 11.6 percent in January to $211,000.

... consumer confidence:

In a separate report, the private-sector Conference Board said its index of consumer sentiment fell in February to 101.7 from 106.8 in January as feelings on the future soured.

... and Midwest manufacturing activity:

The National Association of Purchasing Management-Chicago business barometer fell to 54.9 in February from 58.5 in January.

Markets appear to view the data as negative for the US economy, with US stocks falling and US treasuries rising yesterday.

There was more negative news from the UK where, contradicting other reports (for example, see yesterday's post), the Nationwide building society reported that house prices fell 0.2 percent in February. February also saw falls in UK consumer confidence and retail sales volume.

It was generally better elsewhere in Europe though, as the FT reports.

Inflation excluding energy, food, alcohol and tobacco...fell from 1.4 per cent in December to 1.2 per cent last month – the lowest since February 2001. The “core” inflation figures compared with a headline inflation rate of 2.4 per cent in January, up from 2.2 per cent in December.

... France’s unemployment rate in January nudged higher, and Germany saw a much smaller-than-expected fall of 5,000 in its seasonally adjusted unemployment total to 4.695m in February.

But the Commission’s survey showed manufacturing and service companies have become more optimistic about their employment expectations. The Commission’s eurozone “economic sentiment” index rose from 101.5 in January to 102.7 in February, the highest since June 2001. Economic sentiment improved in Germany, where industrial confidence has soared in recent months, and in France.

News from Asia yesterday was also strong. From Finfacts:

South Korea's industrial production gained 6.1 percent in January, the most in more than seven years...

Japan's industrial production rose for a sixth month, the longest period of expansion in nine years... Production rose a seasonally adjusted 0.3 percent in January from December to a record...

In Japan also, the Nomura/JMMA Purchasing Managers’ Index PMI...remained unchanged at 57.0 in February, signalling an improvement in manufacturing business conditions for the thirty-third consecutive month and a rate of expansion identical to the survey record high seen in January.

But the news from Australia today was less positive. From Bloomberg

Australia's economy grew less than expected in the fourth quarter as home building fell and consumer spending slowed, tempering increased investment by companies. Gross domestic product gained 0.5 percent from the third quarter, when it rose a revised 0.3 percent, the Australian Bureau of Statistics said today.