US durable goods orders disappoint, eurozone money supply growth accelerates

The US economy showed more signs of slowing yesterday. Reuters reports:

New orders for U.S.-made durable goods rose 2.5 percent...

The Commerce Department reported that excluding transportation orders, which are heavily skewed by aircraft, durable goods orders fell 0.1 percent...

The Commerce Department revised down its figures for January, reporting a 9.3 percent decline in overall durable orders in January, first recorded as a 7.8 percent decrease...

In a further sign of weak demand, orders for nondefense capital goods excluding aircraft, viewed as a proxy for business spending, fell 1.2 percent last month after declining 7.4 percent in January. Economists were expecting a 2.3 percent gain.

Reuters also reports that Federal Reserve Chairman Ben Bernanke yesterday acknowledged downside risks for the economy but remains concerned about inflation.

Federal Reserve Chairman Ben Bernanke said on Wednesday that housing market turmoil has clouded the outlook for the U.S. economy but that the central bank remains focused on ensuring core inflation moves lower.

In testimony to the congressional Joint Economic Committee, Bernanke said inflation, outside of volatile food and energy prices, was likely to moderate gradually but that it was higher than the Fed would like and might not move down as hoped.

While that left the direction of US interest rates looking uncertain, there was less uncertainty in the euro area after the latest money supply data. From FT:

Annual growth in M3, the broad money supply indicator, reached a fresh high in February, according to European Central Bank figures. At 10.0 per cent, compared with an upwardly-revised 9.9 per cent in January, the rate of expansion was fastest since the launch of the euro in 1999...

Meanwhile, the ECB figures showed eurozone lending for house purchases remained strong... At 9.4 per cent in February, the annual rate of growth in lending for house purchases was unchanged from January and still high by recent standards, although it was lower than the peak of more than 12 per cent seen last year.

Data from Germany yesterday also pointed to more rate hikes, with Bloomberg reporting that inflation accelerated more than expected to 2.1 percent in March, the highest since July, after a 1.9 percent gain in February, and consumer confidence rose for the first time in five months, GfK AG's confidence index for April rising to 4.4 from a revised 4.3 in March.

The UK economy, though, looks a little cooler after yesterday's data. From Reuters:

The Office for National Statistics said on Wednesday GDP grew by 0.7 percent in the final three months of last year, unexpectedly down from the 0.8 percent rate published last month.

That still left the annual growth rate unchanged at 3.0 percent and growth for 2006 as a whole was revised higher a tenth of a point to 2.8 percent...

Figures from the Nationwide building society earlier on Wednesday showed...[t]he price of an average home rose 0.4 percent in March, bringing the annual rate of house price inflation to 9.3 percent from 10.2 percent in February.