Friday, 22 April 2011

UK retail sales and US leading index rise, Ifo index falls

The economic data on Thursday were mostly positive.

UK data showed surprisingly strong retail sales in March, according to Reuters.

Retail sales rose unexpectedly in March, helped by stronger food sales but doing little to alter a picture of fragile consumer demand that is deterring the Bank of England from raising interest rates...

The Office for National Statistics said retail sales volumes including automotive fuel rose 0.2 percent last month, confounding forecasts for a 0.5 percent fall, after February's 0.9 percent decline...

Britain is pressing on with spending cuts aimed at eliminating the budget deficit over the next four years and separate data showed the government's preferred measure of public borrowing fell to 141.1 billion pounds compared to 145.9 billion predicted at last month's budget...

Separate figures released by the Bank of England showed that major lenders approved 44,000 mortgages for house purchase in March, up from 43,000 in February.

Despite the modest rise, approvals are still running at around half their long-run levels. The net lending flow to businesses fell by 0.4 billion pounds in February, versus a 2.7 billion pound decline in January.

In the US, the leading index rose again in March. Bloomberg reports:

The index of U.S. leading indicators increased for a ninth month in March and Americans’ confidence rose for a fourth week, signaling the expansion may withstand higher fuel costs.

The Conference Board’s gauge of the outlook for the next three to six months rose 0.4 percent after a revised 1 percent gain in February that was larger than previously estimated, the New York-based group said today. The Bloomberg Consumer Comfort Index climbed to minus 42.6 in the period to April 17, the best reading since the end of February...

The Federal Reserve Bank of Philadelphia’s general economic index dropped to 18.5, the lowest level since November, from 43.4 the prior month...

New applications for unemployment benefits dropped by 13,000 to 403,000 in the week ended April 16, the Labor Department said...

However, business confidence fell in Germany in April. Again from Bloomberg:

German business confidence fell for a second month in April after oil prices rose to the highest in 2 1/2 years, damping the global economic outlook and threatening to curb domestic consumer spending.

The Ifo institute in Munich said its business climate index, based on a survey of 7,000 executives, dropped to 110.4 from 111.1 in March. Economists expected a decline to 110.5, according to the median of 38 forecasts in a Bloomberg News survey. The index rose to 111.3 in February, the highest since records for a reunified Germany began in 1991.

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