US leading index edge up amid mixed data

The economic data released yesterday were mixed.

Reuters reports the US data:

The Philadelphia Federal Reserve Bank said its business activity index fell to -0.7 in October from -0.4 in September, below economists' forecasts for a rise to 7.0 in October... The new orders component of the Philadelphia Fed index...rebounded to 13.4 in October from -1.3 in September. The jobs component fell to 9.4 from 10.7 in September...

In a separate report, the Labor Department said first-time claims for state unemployment insurance dropped 10,000 last week to 299,000 from a revised 309,000. The level was below Wall Street forecasts of a rise to 312,000 new claims.

The Conference Board, a private business-backed research group, said its Index of Leading Economic Indicators gained 0.1 percent in September to 137.7 after falling 0.2 percent in August. Analysts had forecast a slightly stronger 0.3 percent rise.

There was also better outlook for Germany. From Bloomberg:

Germany's six leading research institutes today raised their forecasts for economic growth this year and next as stronger than expected demand for exports prompts executives to invest more in plants and machinery.

Europe's largest economy will expand 2.3 percent in 2006 instead of the 1.8 percent forecast in April, the state-funded institutes said today in a report for the government. They raised the 2007 forecast to 1.4 percent from 1.2 percent.

This came as producer prices reportedly fell in September. AFX/Forbes reports:

Producer prices in Germany fell 0.3 pct in September from August and were up 5.1 pct from a year earlier, the Federal Statistics Office said...

Excluding energy, September producer prices rose only 2.8 pct from a year earlier and were up 0.1 pct month-on-month, the statistics office said.

In the UK, Reuters reports that retail sales fell 0.4 percent in September, the biggest fall since the start of the year, but prices were 0.6 percent higher than a year ago, the first gain since January 2002 and the biggest rise since June 2001, while M4 money supply grew 1.8 percent on the month in September and by 14.5 percent on the year, a 16-year high.

Another Reuters report said that underlying net mortgage lending rose by 5.4 billion pounds in September, the smallest increase since April, according to data from the British Bankers' Association. However, the Council of Mortgage Lenders reported that gross mortgage lending hit a record high for the month of September, while the Building Societies Association said mortgage approvals were also at record levels for the month.

Finally, in China, GDP grew 10.4 percent in the third quarter, down 0.9 percentage point from the second quarter, but consumer prices rose 1.5 percent in September over the previous year, up 0.2 percentage point from August.