“German unemployment increased less than economists forecast in December even asEurope’s debt crisis curbed company investment and economic growth.
The number of people out of work rose a seasonally adjusted 3,000 to 2.942 million, the Nuremberg-based Federal Labor Agency said today. Economists predicted an increase of 10,000, the median of 19 estimates in a Bloomberg News survey showed. The adjusted jobless rate held steady at 6.9 percent, close to a two-decade low…”
Comments »“LONDON (Reuters) – Global manufacturing activity expanded last month for the first time since May, supported by solid output gains in China, the United States and Britain, a business survey showed on Wednesday.
JPMorgan’s Global Manufacturing PMI, produced with research and supply management organizations, rose to 50.2 in December from November’s 49.6, nudging above the 50-mark that divides growth from contraction for the first time in seven months.
“PMI survey indices for output, new orders and employment continued to lift at the end of 2012, as the global manufacturing sector stabilizes following a softer patch in the middle of the year,” saidDavid Hensley, director of global economics coordination at JPMorgan.
As output rose for the second straight month, factories increased staffing levels for the first time since June, the survey found.
Earlier data showed U.S. manufacturing ended 2012 on a modest upswing, as increased demand at home and abroad helped the sector to grow in December at its fastest rate in seven months.
But euro zone factories sank deeper into recession with new orders tumbling – a sharp contrast to continuing signs of revival in China.
The index combines survey data from countries including the United States, Japan, Germany, France, Britain, China and Russia.
(Reporting by Jonathan Cable; editing by Stephen Nisbet) “
Comments »November construction spending was down 0.3% vs expectations of +0.5%
Comments »“NOTE: The PMI was initially reported as 54.2. However, the number has since been corrected to 54.0.
The December reading of the US purchasing managers index is out, and the number looks good.
PMI jumped to 54.0 from 52.8 in November. This is also better than economists’ expectation calling for 53.6.
Any reading above 50 signals expansion in the industry.
Here are key points from Markit:
From Markit’s Chief Economist Chris Williamson: ”
Comments »“NEW YORK (Reuters) – Borrowing by small U.S. businesses rose marginally in November, indicating they were essentially on hold in terms of growing their enterprises in the face of economic and government fiscal uncertainty, a report on Wednesday showed.
The Thomson Reuters/PayNet Small Business Lending Index, which measures the overall volume of financing to small U.S. companies, rose to 108.3 from a downwardly revised 107 in October, PayNetsaid.
PayNet had initially reported the October figure as 107.5.
Borrowing was up 3 percent in November from a year earlier.
PayNet founder Bill Phelan, located in Chicago, said the small rise in the monthly index and the 3 percent year-on-year gain indicated small businesses are essentially on hold when it comes to borrowing and growing their businesses.
“Small businesses are on hold until they get some better stability from policymakers and greater clarity on the direction of the economy,” he said.
“Small businesses were waiting to see what is happening with Washington in November, they were waiting for more consumer activity to emerge, really watching the front door for new sales to emerge and it doesn’t look like any major new influx of sales came in — they have really been on hold,” Phelan said.
Small businesses are often responsible for the bulk of new job creation after recessions. The recent recession ended in 2009, but sluggish growth has meant weak job growth, and unemployment in November registered 7.7 percent, well above the 5.5 percent to 6 percent that many economists view as normal….”
Comments »“Euro-area manufacturing output contracted more than initially estimated in December, adding to signs a recession in the currency bloc may extend into this year as leaders struggle to tackle the sovereign-debt crisis.
A gauge of manufacturing in the 17-nation euro area fell to 46.1 from 46.2 in November, London-based Markit Economics said today. That’s below an initial estimate of 46.3 on Dec. 14. A reading below 50 indicates contraction. The gauge has been below 50 for 17 months.
The euro-area economy has shrunk for two successive quarters and economists foresee a further decline in gross domestic product in the final three months of last year. The European Central Bank forecasts contractions of 0.5 percent and 0.3 percent in 2012 and 2013.
“The euro-zone manufacturing sector remained entrenched in a steep downturn at the end of the year,” Chris Williamson, chief economist at Markit, said in the report. “The region’s recession therefore looks likely to have deepened, possibly quite significantly, in the final quarter.”
The euro was little changed after today’s report and traded at $1.3258 at 10:32 a.m. in Brussels….”
Comments »While the rate of growth was not anything to get excited about, at least the index is not dropping. Good news developing perhaps…
Comments »
“South African credit demand strengthened in November as the central bank kept interest ratesat the lowest in more than 30 years to spur spending.
Borrowing by households and companies rose 9.6 percent compared with 8.4 percent in October, the Pretoria-based Reserve Bank said on its website today. The median estimate of eight economists surveyed by Bloomberg was for growth of 8.4 percent.
The Reserve Bank last month left its benchmark lending rate at 5 percent to help support growth in Africa’s largest economy. Consumer spending, which makes up about 60 percent of demand, has come under strain this year as the jobless rate rose to 25.5 percent and the economy expanded at its slowest pace since a 2009 recession in the third quarter.
Growth may still be “very low” in the final three months of the year, central bank Governor Gill Marcus said on Nov. 28. The bank is forecasting 2.5 percent expansion this year, down from 3.5 percent in 2011…”
Comments »“As talks between the International Longshoremen’s Association and the U.S. Maritime Alliance take place in a shroud of secrecy to avert a strike by 14,500 longshoremen members working at 14 major East Coast ports on December 30, one manufacturing association puts the cost of a potential strike at a billion dollars a day.
Robyn Boerstling, director of transportation and infrastructure policy at the National Association of Manufacturers (NAM) says manufacturers have been making preparations to reduce the impact on supply chains and avoid disruptions to production capabilities in anticipation of a strike.
(Read More: Talks to Avoid East Coast Port Strike to Resume, Details Kept Mum)
“Manufacturers are trying to protect jobs and minimize the damage of potential supply chain disruptions from a costly strike, which could cost an estimated billion dollars a day,” she told CNBC.
Boerstling said some manufacturers have increased their monthly export volumes in advance of the December 30 walk-out date, while others have increased inventories and many have diverted cargo….”
Comments »“Yesterday the econoblogosphere was all atwitter about a MasterCard report that consumers had only spent 0.7% more this holiday season vs. last year. This is said to be the weakest showing since the recession collapse of 2008,
But before you accept that a the final word on the subject of consumer sales at year end 2012, take a look at this screenshot of Gallup’s daily consumer spending report published yesterday, covering data
fron February 2008 through December 23….”
“Japan’s industrial output tumbled more than forecast to the lowest level since the aftermath of the record 2011 earthquake, bolstering the case for Prime Minister Shinzo Abe to unleash large-scale stimulus.
The 1.7 percent drop in November from October exceeded all 27 forecasts in a Bloomberg News survey, a government report showed today in Tokyo. The nation also remained mired in deflation, with consumer prices excluding fresh food dropping 0.1 percent from a year before, compared with a central bank goal of 1 percent and Abe’s desired target of 2 percent.
With neighbor South Korea reporting a jump in production almost double the highest estimate among economists surveyed, Japan’s data may strengthen the new Abe administration’s determination to drive down the yen and force the Bank of Japan (8301) to add monetary stimulus. On the fiscal front, Abe has told ministries to compile emergency spending proposals by Jan. 7.
“Weakness in exports is the major drag on Japan’s economy,” said Yoshimasa Maruyama, chief economist at Itochu Corp. (8001) in Tokyo. “Given the weak state of the economy, Abe’s government may need a large-scale stimulus program to boost growth.”
Comments »“Chinese industrial companies’ profits rose for a third month in November, supporting a rebound in economic growth that may ease the transition to the nation’s new leadership.
Net income gained 22.8 percent from a year earlier to 638.5 billion yuan ($102 billion), theNational Bureau of Statistics said today in Beijing, after a 20.5 percent rise in October.
The world’s second-biggest economy is set for the first pickup in growth in eight quarters after the government accelerated investment-project approvals and boosted spending on infrastructure. The new Communist Party leadership led by Xi Jinping is seeking to sustain the recovery without fueling property-price bubbles or adding to bad-loan risks in the banking system.
“China’s economic recovery trend is quite clear now, and growth in the first half of 2013 will be strong as local governments are eager to start new investment projects now,’ Shi Lei, a Beijing-based analyst with Founder Securities Co., said before the release. ‘‘At the same time, recovery prospects are clouded by weak external demand and a possible crackdown from regulators on the shadow banking system.”
The Shanghai Composite Index (SHCOMP) of stocks advanced yesterday to the highest level in five months after investors wiped out losses of as much as 11 percent during this year. The gauge was 0.1 percent lower as of 11:30 a.m local time today on concern a rally that lifted shares from an almost four-year low is excessive.
A separate report pointed to limits on China’s recovery….”
Comments »“South Korea lowered its growth forecasts for this year and for 2013 in the first revisions since a new president was elected on Dec. 19.
Gross domestic product will expand 3 percent next year, the Finance Ministry said in a statement in Sejong, less than the 4 percent predicted in September. Growth may be 2.1 percent this year, versus a previous 3.3 percent estimate.
The update brings the government’s forecasts closer to those of private economists and the central bank as Europe’s debt crisis caps demand for the nation’s exports. The pace of expansion next year may partly depend on the extent of any extra spending by president-elect Park Geun Hye, who will take office in February.
“Downside risks from Europe are bigger than anticipated,” said Choi Sang Mok, a director general at the ministry.
The Kospi index of stocks fell 0.3 percent as of 1:43 p.m. in Seoul, paring gains for the year to 8.3 percent. The won appreciated 0.1 percent to 1,072.00 per dollar, according to data compiled by Bloomberg, with this year’s 7.5 percent advance the biggest among Asia’s 11 most-traded currencies.
The Bank of Korea said today that it will support the recovery while also examining possible economic imbalances “arising from the extended duration of its accommodative monetary policy stance.”
Comments »“U.S. households have been saving more and spending less since the financial crisis over four years ago, and family finances are starting to reflect the new trend.
U.S. households spent 10.6 percent of their after-tax income on debt payments in the third quarter of this year, the lowest level since 1983, according to Federal Reserve data cited by The Wall Street Journal.
Tack in other payments not classified as debt, such as rent and car leases, and the figure comes to 15.7 percent, also a roughly 30-year low….”
Comments »“A strange thing has happened in the world of luxury products. There now appear to be separate realities in the world of luxury brands.
Instead of bundling luxury retailers together and making a one-size-fits-all sector call as they have in the past, investors must reach brand-by-brand decisions, according to the Financial Times.
For instance, Tiffany reported a 30 percent drop in third-quarter earnings, Louis Vuitton reported the softest growth in 12 years, and Burberry issues a profit warning in September, the Times reports. Yet Hermes raised its sales and profitability targets and Prada Group’s earnings through September of this year were up 50 percent over last year…”
Comments »Prior: 9
Market Expects 5-15
Actual 5
“Highlights
Growth in manufacturing activity in the Richmond Fed’s district for December eased a bit but remained positive. The composite index of manufacturing activity lost four points, settling at 5 from November’s reading of 9. Among the index’s components, shipments fell five points to 6, the gauge for new orders was almost unchanged at 10, and the jobs index turned negative, losing six points to minus 3.
Survey assessments of current prices indicated that raw materials prices grew on par with November, while finished goods prices grew at a slightly slower rate.
Looking forward, assessments of business prospects for the next six months were less optimistic in December as the index of expected shipments lost eight points, ending at a reading of 20, and the new orders index dropped thirteen points to finish at 12.”
Comments »“U.S. holiday retail sales this year were the weakest since 2008, when the nation was in a deep recession. In 2012, the shopping season was disrupted by bad weather and consumers’ rising uncertainty about the economy.
A report that tracks spending on popular holiday goods, the MasterCard Advisors SpendingPulse, said Tuesday that sales in the two months before Christmasincreased 0.7 percent, compared with last year. Many analysts had expected holiday sales to grow 3 to 4 percent.
In 2008, sales declined by between 2 percent and 4 percent as the financial crisis that crested that fall dragged the economy into recession. Last year, by contrast, retail sales in November and December rose between 4 percent and 5 percent, according to ShopperTrak, a separate market research firm. A 4 percent increase is considered a healthy season.
Shoppers were buffeted this year by a string of events that made them less likely to spend: Superstorm Sandy and other bad weather, the distraction of the presidential election and grief about the massacre of schoolchildren in Newtown, Connecticut.
The numbers also show how Washington’s current budget impasse is trickling down to Main Street and unsettling consumers. If Americans remain reluctant to spend, analysts say, economic growth could falter next year….”
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