Friday 28 March 2014

US fourth quarter growth revised up, Japanese unemployment falls

The latest US GDP revision released on Thursday showed that the economy grew at an annual rate of 2.6 percent in the fourth quarter, up from 2.4 percent in the previous estimate.

The upward revision was mainly due to consumer spending growth being revised up to a 3.3 percent rate, the fastest in three years, from 2.6 percent.

Providing additional good news for the US economy, another report on Thursday showed that initial claims for state unemployment benefits dropped 10,000 to 311,000 last week, the lowest level since November, pushing the four-week average to its lowest level in six months.

Not so positive was a report from the National Association of Realtors showing that pending home sales fell 0.8 percent in February to its lowest level since October 2011.

Elsewhere, a rebound in consumer spending looks set to drive UK economic growth again in the first quarter. A report on Thursday showed that retail sales jumped 1.7 percent in February after falling 2.0 percent in January while a report on Friday from GfK showed that its UK consumer confidence index rose to -5 this month, its highest reading since August 2007, from -7 in February.

Consumer spending, though, experienced a setback in Japan last month. A report on Friday showed that household spending fell 2.5 percent in February from a year earlier. It had increased 1.1 percent in January.

More encouragingly, another report on Friday showed that Japan's unemployment rate fell to 3.6 percent in February from 3.7 percent in January. The jobs-to-applicants ratio rose to 1.05, the highest since August 2007, from 1.04.

Another report from Japan on Friday showed that the inflation rate excluding fresh food was unchanged at 1.3 percent in February.

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