Beige Book and other reports paint mixed picture

The only major piece of economic news from the US yesterday was the Federal Reserve's Beige Book summary of economic conditions, which reports "continued economic growth during June through mid-July, with numerous individual reports pointing to evidence that the pace of growth has slowed". Retail sales were reported as slightly weaker and residential real estate markets cooled. However the manufacturing sector was reported to be strong. Increases in wages and in prices of final goods and services were described as modest.

The economic news from Europe yesterday was relatively downbeat, with German business confidence falling in July:

German business confidence fell from a 15-year high in July as record oil prices and rising interest rates threatened to slow growth in Europe's largest economy.

The Ifo economic research institute in Munich said today its confidence index, based on responses from 7,000 executives, slid to 105.6 from 106.8 in June. Economists expected a reading of 106, the median of 45 estimates in a Bloomberg survey showed.

...and British factory orders falling, albeit at a slower pace.

Factory orders fell at a slightly weaker pace in July and manufacturers remained upbeat about boosting future output, a survey showed on Wednesday.

The Confederation of British Industry said its monthly manufacturing order books balance fell to -11 in July from -12 in June.

However, the latest trade data show that Asia is still experiencing boom-like conditions. Japan reported yesterday that its trade surplus fell 5.9 percent in June from a year earlier to 807.9 billion yen, but mainly due to the soaring cost of crude oil. Exports rose 14.4 percent while imports rose 18.2 percent.

South Korea also saw its trade balance affected by higher oil prices. Its June current account surplus halved from a year ago to US$1.1 billion. Its June trade surplus was US$2.9 billion. Exports rose 18.6 percent while imports rose 21.9 percent.

Elsewhere in Asia, Singapore, which had seen its non-oil domestic exports grow 17 percent in June, reported yesterday that manufacturing output in June grew 22.5 percent on a year-on-year basis or 19.3 percent on a seasonally-adjusted month-on-month basis.