Overnight News Recap: CBI Retail Index, French Cons Conf Fall, JP Unemp Higher

News Recap | Written by CEP News | Jul 29 08 10:53 GMT |

(CEP News) - Final measures of the UK's M4 money supply for June along with declines in the Confederation of British Industry's (CBI) retail sales report for July dominated economic news in the UK while the euro zone saw falling consumer confidence and housing starts in France with rising wages in Italy. In Japan, the unemployment rate unexpectedly ticked up to 4.1% and retail trade for June performed better than economists had been expecting. On Tuesday, the Bank of England revised down its estimates on money supply growth and reported that M4 grew 1.8% month-over-month, down from the 2.0% growth rate initially reported, but up from the 0.4% growth rate observed in May. Year-over-year, the BOE announced that the M4 money supply grew at a rate of 11.4%, lower than the 11.5% rate previously estimated, but up significantly from the 10.0% gain seen in the previous month. Conversely, an upward revision was seen in the M4 money supply lent to the private sector. According to the central bank's final estimates, £46.1 billion was lent out in June, up from the initial reading of £45.9 billion and the £4.8 billion seen in May. Furthermore, mortgage approvals in the UK were noted to have declined in June to a record low 36,000, down from both the 41,000 level seen in May and the 37,000 figure expected. According to the Confederation of British Industry's (CBI) industrial trades survey, the -36% balance between the percentage of respondents who reported lower sales in July and the percentage of respondents claiming a higher level of sales is the weakest recorded in the history of the study. Expectations had called for a much more balanced reading of -7%. Meanwhile, August is likely to show the same imbalance in sales figures at -32%. On Tuesday, the National Institute for Statistics and Economic Studies (INSEE) reported that French producer price inflation accelerated to a high of 7.3% in June year-over-year, up from the previous month's 6.7% rate. However, economists had expected an even more pronounced gain in the inflation rate to 7.4%. Excluding the effects of energy and food prices, the producer price index rose only 2.4% in annualized terms in June, up from the 2.1% increase recorded in May. Month-over-month, the French PPI increased 0.7%, down from both the 0.8% rise expected and the 1.3% record jump seen in May. While energy production costs led the way with a gain of 2.1% in monthly terms, the increase is notably smaller than the 5.1% jump observed in the previous month. According to the National Institute for Statistics and Economic Studies (INSEE), consumer confidence in France slipped lower than expected with the sentiment indicator falling to a record low -48 in July. Economists had expected a fall to only -47 after the indicator had dipped to -46 in June. The French Housing Ministry said housing starts fell 28.2% to 79,220 in the three months to June year-over-year, deepening the 21.6% annualized decline recorded in the three months to May. The number of housing permits also saw a continued decline, falling 15.3% in the three months to June 2008 compared to the same period one year ago. In the three months to May, the number of new housing permits had decreased 19.9% annually. According to the National Institute of Statistics (ISTAT), Italian hourly wages rose 0.3% in June compared to the month before, up from the expected wage gain of 0.1%. May's wage increase had been recorded at 0.6% month-over-month. In annualized terms, Italian wages increased 3.6% in June, up from both the 3.4% increase expected and the 3.3% jump seen in the previous month. On Tuesday, Statistics Netherlands reported that producer confidence slipped farther than expected in July, as reflected in the sentiment indicator falling to 2.4 from June's 5.3 level. Economists had expected a less severe decline to 3.0 for the month. Consumer pessimism had also been underestimated. According to Statistics Netherlands, the consumer confidence indicator fell to -31 in July, down from both the -21 reading expected and the -19 figure recorded in June. On Tuesday, the National Bank of Slovakia announced that it would keep its two-week repo tender limit rate unchanged at 4.25% following the Bank Board's 32nd meeting. The Slovakian central bank also reported that its overnight sterilization rate would remain at 2.25%, while the overnight refinancing rate would be maintained at 5.75%. Against expectations for a flat reading, Swedish retail sales rose 1.8% in seasonally adjusted terms month-over-month in June, up from the previous month's 1.0% gain, according to data released by Statistics Sweden. Meanwhile, May's increase was revised up from an initial figure of +0.9%. On an annual basis, retail sales jumped 3.3%, up from both the 0.6% gain expected and the 1.3% increase recorded in the May. The Japanese government said on Tuesday that 130k people lost jobs in June compared to the 190k lost in May, and 70k people became employed compared to a previous flat reading. Consequently, the unemployment rate rose to 4.1% despite expectations for no change to the 4.0% level, and the job-to-applicant ratio declined as expected to 0.91 from 0.92 in May. Household spending in Japan improved further than expectations, with the annualized rate rising to -2.8% in June compared to the previous month's -3.2% level. The consensus had been looking for a -2.8% year-over-year decline. On a monthly basis, spending rose 1.5% in June compared to a 0.9% contraction in May. According to the Ministry of Economy, Trade and Industry in Tokyo on Monday, monthly Japanese retail trade was flat in June despite forecasts for a 0.5% decline, and May's 0.2% contraction was revised up to a 0.1% fall. On an annual basis, sales rose 0.3% compared to expectations for a 0.2% decline while May's 0.3% gain was revised to a 0.2% rise. The report also says that large retailers sales declined 3.9% on the year despite expectations for 3.8% decline and the previous 2.1% fall was revised down to a 2.0% contraction. The Australian Conference Board's leading economic index declined 0.1% month-over-month in May following April's 0.3% increase. JP Jobless Rate June 4.1% vs. Exp:4.0% Prior:4.0% JP Job-To-Applicant Ratio June 0.91 vs. Exp: 0.91 Prior: 0.92 JP Household Spending (Y/Y) June -1.8% vs. Exp: -2.8% Prior: -3.2% JP Large Retailers' Sales June -3.9% vs. Exp: -3.8% Revised: -2.0% Prior: -2.1% JP Retail Trade (Y/Y) June +0.3% vs. Exp: -0.2% Revised: +0.3% Prior: +0.2% JP Retail Trade (M/M) SA June 0.0% vs. Exp: -0.5% Revised: -0.1% Prior: -0.2% AU Conference Board Leading Index (M/M) May -0.1% vs. Prior: +0.3% FR Consumer Confidence Indicator July -48 vs. Exp: -47 Prior: -46 FR Producer Prices (M/M) June +0.7% vs. Exp: +0.8% Prior: +1.3% FR Producer Prices (Y/Y) June +7.3% vs. Exp: +7.4% Prior: +6.7% FR Housing Starts 3M Y/Y Change June -28.2% vs. Prior: -21.6% FR Housing Permits 3M Y/Y % Change June +15.3% vs. Prior: -19.9% IT Hourly Wages (M/M) June +0.3% vs. Exp:+ 0.1% Prior: +0.6% IT Hourly Wages (Y/Y) June +3.6% vs. Exp: +3.4% Prior: +3.3% GB M4 Money Supply (Y/Y) June Final +11.4% vs. Prior: +11.5% GB M4 Sterling Lending June Final £46.1B vs. Prior: £45.9B GB Net Consumer Credit June £0.9B vs. Exp: £1.0B Revised: £1.3B Prior: £1.4B GB Net Lending Sec. on Dwellings June £3.1B vs. Exp: £3.7B Revised: £3.8B Prior: £4.1B GB Mortgage Approvals June 36K vs. Exp: 37K Revised: 41K Prior: 42K GB M4 Money Supply (M/M) June Final +1.8% vs. Prior: +2.0% DE CPI-Hesse (M/M) July +0.5% vs. Prior: +0.3% DE CPI-Hesse (Y/Y) July +3.7% vs. Prior: +3.8% GE CPI-Brandenburg (Y/Y) July +3.2% vs. Prior: +3.4% GE CPI-Brandenburg (M/M) July +0.5% Prior:+0.3% GE CPI-Saxony (Y/Y) July +3.6% vs. Prior: +3.4% GE CPI-Saxony (M/M) July +0.6% vs. Prior:+0.3% GE CPI-Bavaria (M/M) July +0.6% vs. Prior: +0.3% GE CPI-Bavaria (Y/Y) July +3.3% vs. Prior: +3.4% 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. 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