Saturday, 22 January 2011

Confidence improves

Friday reports show improving confidence in several major economies.

In Japan, the government has raised its economic assessment. Bloomberg reports:

Japan’s government raised its assessment of the economy for the first time since June, as global demand encourages companies to step up output.

The economy is beginning to show signs of a rebound, the Cabinet Office said in a monthly report in Tokyo today. It upgraded its evaluation of industrial production, which rose for the first time in six months in November, saying it was beginning to bottom out.

In Germany, Bloomberg reports that business confidence rose in January.

German business confidence unexpectedly rose to a record high in January as booming exports to Asia and stronger household spending bolstered growth in Europe’s largest economy.

The Munich-based Ifo institute said its business climate index, based on a survey of 7,000 executives, increased to 110.3 from 109.8 in December. That’s the highest since records for a reunified Germany began in 1991...

Bloomberg also reports a jump in French business confidence.

French business confidence jumped to its highest in almost three years in January as signs a global economic expansion is accelerating lifted the outlook for exports this year.

An index of sentiment among factory executives increased more than expected to 108 from a revised 102 in December, national statistics office Insee said today. Economists expected a reading of 104, according to the median of 3 forecasts gathered in a Bloomberg News survey.

Not so positive were the reports from the UK.

Reuters reports that business lending rose slightly in November but mortgage lending and approvals fell.

The BoE's Trends in Lending report showed the net monthly flow of lending to businesses by British banks picked up to 1.3 billion pounds in November after a decline of 2.8 billion pounds in October...

The number of loans approved for home purchase, meanwhile, fell to 40,000 in December from 45,000 in November, the lowest since March 2009 and suggesting a further weakening in house prices is on the cards.

Net mortgage lending slowed to 0.8 billion pounds from 1.4 billion in November, the lowest since the current series began in January 2009.

Reuters also reports that retail sales fell in December.

Harsh weather and higher inflation combined to give retailers their worst December on record, data showed on Friday, reinforcing signs that growth slowed sharply in the last three months of 2010...

The Office for National Statistics said December retail sales were flat on the year after 1.0 percent volume growth in November, the weakest change since January 2010 and the worst annual performance for any December since records began in 1988. Economists had forecast a 0.9 percent rise on the year.

Overall retail sales fell 0.8 percent on the month after a 0.4 percent rise in November, again weaker than forecast. But stripping out the drop in fuel sales due to disrupted travel, the decline was less steep than economists had predicted.

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