Friday, 25 March 2011

Euro area slows, UK retail sales and US durable goods orders fall

The economic data released on Thursday were a bit weaker than usual.

Flash estimates of service and manufacturing activity in the euro area showed slowing growth. Bloomberg reports:

Growth in Europe’s services and manufacturing industries slowed more than economists forecast in March after surging energy costs and Japan’s earthquake clouded the global growth outlook.

A composite index based on a survey of purchasing managers in the 17-nation euro region in both industries fell to 57.5 from 58.2 in February, London-based Markit Economics said today. Economists forecast a drop to 57.8, the median of 16 estimates in a Bloomberg News survey showed. That’s still the second highest level since July 2007. A reading above 50 indicates expansion...

An indicator measuring euro-region manufacturing growth fell to 57.7 in March from 59 in the previous month, Markit said. A gauge of service industries rose to 56.9 from 56.8 in February. That’s the highest since August 2007.

Reuters reports that UK retail sales fell in February.

Retail sales fell more than expected in February, reversing half of January's rebound with volumes hit by the biggest jump in prices in 17 years which was only partly due to the rise in VAT, official data showed on Thursday.

The ONS said sales volumes including automotive fuel fell 0.8 percent last month after a downwardly revised increase of 1.5 percent in January. That was bigger than the 0.6 percent decline forecast by analysts and took sales up 1.3 percent on the year.

Moreover, prices including fuel leapt at their fastest monthly pace since 1994, up 2.5 percent. Excluding fuel, prices were 2.4 percent higher on the month -- the biggest rise since the series began in 1988.

And in the US, Bloomberg reports that durable goods orders fell in February.

Orders for long-lasting goods unexpectedly fell in February, raising concern over the sustainability of the rebound in U.S. business investment.

Bookings for goods meant to last at least three years dropped 0.9 percent after a 3.6 percent gain the prior month that was larger than initially reported, the Commerce Department said today in Washington...

The number of workers filing claims for jobless benefits declined by 5,000 to 382,000 in the week ended March 19, Labor Department figures showed, in line with the median forecast of economists surveyed by Bloomberg. The total sum of those receiving government payments dropped to the lowest level in almost three years.

The Bloomberg Consumer Comfort Index dropped to minus 48.9 in the period to March 20 from minus 48.5 the prior week, another report today showed. The measure of the current state of the economy slumped to a 15-month low.

There were some positive data on China, though. Again from Bloomberg:

China’s manufacturing growth is accelerating, according to preliminary data from a survey of purchasing managers, signaling the economy may withstand increased interest rates.

The index may rise to 52.5 from 51.7 in February, HSBC Holdings Plc and Markit Economics said in an e-mailed statement today. This is the second time advance data has been released.

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