Jul 21 14:55 GMT Sponsor Forex Brokers Overnight News Recap: Bundesbank Sees Slower Q2, UK House Prices Decline

News Recap | Written by CEP News | Jul 21 08 10:34 GMT |

(CEP News) - The Bundesbank said it expects slower growth in the second quarter due to a "technical correction" and Rightmove reported ongoing declines in housing prices in the UK as Europe saw a relatively peaceful session this morning. In Australia, markets received slower-than-expected PPI while Japanese markets were closed for holiday. In its monthly report published on Monday, the Bundesbank said that the German economy slowed in the second quarter of 2008 as construction production deteriorated and rising inflation limited consumption. After a mild winter boosted construction output and helped push economic growth to a surprisingly strong 1.5% in the first quarter, the Bundesbank stressed that the weakness in Q2 would be due to a "technical" correction. Second-quarter GDP data is expected to be released on Aug. 14. According to the Rightmove house price index, the average asking price for homes in the UK fell by 1.8% to £235,219 on a monthly basis in July, reflecting a decrease of £4,345. Compared to the same month in 2007, July's average asking price declined 2.0%, down from the 0.1% annualized gain recorded in June 2008. According to data released by the Swiss Federal Statistics Office, producer and import prices rose 0.6% month-over-month in June, up from the 0.5% growth rate expected. Producer and import prices had increased 1.2% in May. Year-over-year, producer and import price inflation reached 4.5%. The consensus had called for a 4.4% growth rate following May's 3.9% jump. The Swiss Federal Statistics Office also reported that M3 money supply in Switzerland grew 1.5% in June 2008 compared to the same month one year ago. May had recorded a 2.9% money supply growth rate, revised up from 2.6%. Slovenian producer prices rose 1.2% month-over-month in June, up significantly from May's 0.6% increase, according to a press release from the Statistical Office of the Republic of Slovenia. "The price increase was the result of higher prices of export products (by 1.8%) and the prices of manufactured goods on the domestic market (by 0.5%)," the press release elaborated. According to the Financial Times, French President Nicolas Sarkozy is developing plans to hold the European Central Bank increasingly accountable to governments within the euro area. Sarkozy is also suggesting that the finance ministers set up a permanent secretariat to better co-ordinate policy and strengthen contact with the ECB. Producer prices in Australia advanced 1.0% q/q in the second quarter of 2008, according to the Australian Bureau of Statistics on Monday. The result was below forecasts for a 1.6% increase and the previous quarter's 1.9% rise. On an annual basis, PPI moved up 4.7%, also short of forecasts for a 5.2% rise and the previous quarter's 4.8% gain. The ABS also said new motor vehicle sales in Australia expanded by 1.0% month-over-month in June compared to an upwardly revised 1.5% decline, while annual sales rose 1.4% compared to a 2.4% increase in May. GB Rightmove House Prices (M/M) July -1.8% vs. Prior: -1.2% GB Rightmove House Prices (Y/Y) July -2.0% vs. Prior: +0.1% AU Producer Price Index (Q/Q) Q2 +1.0% vs. Exp: +1.6% Prior: +1.9% AU Producer Price Index (Y/Y) Q2 +4.7% vs. Exp: +5.3% Prior: +4.8% AU New Motor Vehicle Sales (M/M) June +1.0% vs. Revised: -1.5% Prior: -1.6% AU New Motor Vehicle Sales (Y/Y) June +1.4% vs. Revised: +2.4% Prior: +2.6% By Erik Kevin Franco, efranco@economicnews.caThis email address is being protected from spam bots, you need Javascript enabled to view it and Todd Wailoo, twailoo@economicnews.caThis email address is being protected from spam bots, you need Javascript enabled to view it , edited by Nancy Girgis, ngirgis@economicnews.caThis email address is being protected from spam bots, you need Javascript enabled to view it CEP Newswires - CEP News © 2008. All Rights Reserved. www.economicnews.ca The Copying, Broadcast, Republication or Redistribution of CEP News Content is Expressly Prohibited Without the Prior Written Consent of CEP News. A copy of CEP News disclaimer can be found at http://www.economicnews.ca/cepnews/wire/disclaimer.