- Weekly: **Unemployment Initial Claims Data have been revised**
- US: Housing Starts by State and Region (Feb)
- CPB World Trade Monitor (Jan)
- CPB World Trade Monitor (Jan)
- France: Registered Unemployed & Job Vacancies (Feb)
- US: Household Employment for States and Regions (Feb)
- US: Wholesale Trade Revisions, Advance Durable Goods (Feb)
- Manufacturing Survey - Markit US (Flash - Mar), Composite Survey - US (Flash - Mar), Services Survey - US (Flash - Mar)
- more updates...
Economy in Brief
Correction to Unemployment Insurance Weekly Claims
The Department of Labor has issued a correction to yesterday's annual revision to seasonally adjusted weekly unemployment claims...
EMU PMIs Are Off to the Races...Farewell Mediocrity?
The PMI rankings for the manufacturing and service sector PMIs in the EMU are suddenly off the chart...
U.S. New Home Sales Improve While Prices Decline
Sales of new single-family homes increased 6.1% (12.8% y/y) during February to 592,000 units (AR)...
Kansas City Federal Reserve Factory Index Strengthens; Expectations Surge
The Kansas City Fed reported that its index of regional manufacturing sector business activity increased to 20 during March...
U.S. Initial Unemployment Insurance Claims Rise
Initial claims for unemployment insurance increased to 258,000 (-3.0% y/y) during the week ended March 18...
U.K. Retail Looks Less Bulletproof
For the most part, the assessments embodied in the March survey from the UK's CBI are being taken as being upbeat...
by Robert Brusca February 19, 2016
Germany's PPI (excluding construction) fell by 0.8% in January. It fell by 1.1% in manufacturing and by 0.2% in manufacturing excluding energy. Overall manufacturing and ex-energy manufacturing inflation all are falling over three months, over six months and over 12 months. This is a striking development underscoring how much negative inflation trends still are in play.
Except for manufacturing excluding energy, sequential inflation rates are falling at increasingly faster rates. For manufacturing ex-energy, that sequence is not fully in place, but inflation there is still lower over three months than over 12 months (prices are falling faster).
Moving on to the more closely-watched CPI trends, we see the same sorts of trends in place although prices are not falling on all horizons. But CPI, HICP and energy inflation trends in Germany all are falling. The trend for Brent continues to show accelerating price declines which should pass on to other price trends. Thus, our best view of the data is that price trends are lower and will continue to have downward pressures for some time to come. Yet, the ECB remains well behind the curve on hitting its inflation target as it has for some time.
Germany, one of the most consistent and strong economies in Europe, is not seeing any forestalling of deflation pressures because of its growth or low unemployment rate. Instead, Germany seems to have the same deflation issues as the rest of the euro area.
Germany for most of EMU history has long had the lowest inflation rate in the EMU but not anymore. Still, German inflation was close to the EMU just under 2% target last in April 2012 on the PPI. But since April 2014, the German PPI has been consistently falling. Germany's CPI headline has been below a 1% year-on-year pace since May 2014. It was just below 2% last in July 2013.
Germany's economy continues to show a persistent tendency to create inflation that is too low. Since energy declines are ongoing, there will be more of that weakness to come. Of course, ECB policy will be made on EMU-wide trends, but those trends also continue to show rampant inflation undershooting. Germany is simply not an exception to the needs of the region as it has often been in the past.