Global| Feb 13 2008IP Sinking in All Sectors
Summary
All EMU industrial sectors are seeing a considerable decline in their rates of growth for industrial output. Capital goods has been a strong sector in Europe and we have seen orders for capital goods holding up especially in Germany. [...]
All EMU industrial sectors are seeing a considerable decline
in their rates of growth for industrial output. Capital goods has been
a strong sector in Europe and we have seen orders for capital goods
holding up especially in Germany. But on an EMU-wide basis capital
goods output is now declining over three months and its growth rate
year over year is declining as well. Consumer goods output has never
really been strong in this recovery and now it is showing signs of
decay from a low growth level. For the quarter industrial output is off
by about one percentage point.
Among countries Germany is the strongest but even its growth
rates show a deceleration in IP. France (excluding construction) is
holding up a bit better than Germany, but with a weaker Yr/Yr rate of
growth. Italy’s output shows a deep year/year decline for output. Spain
shows a shallow Yr/Yr decline. The UK has been pretty flat for most of
the past year.
For Q4 2007 Germany has the strongest contribution from IP at
3.4% Spain is next at 2.9% France is third at 1.1%. Italy has a
strongly negative -10.4% IP contraction in Q4. The UK has a small 0.5%
subtraction as IP sides in the fourth quarter.
Despite some stirring the Zew Survey for Germany we also saw
that the Zew current conditions assessment is sliding. A pick up in
sentiment for the future hangs on some rate cuts by the Fed, the
potential for more and a US stimulus package that has just been passed
into law. But the future remains cloudy and current conditions are
still very weak, and in some cases, getting weaker.
| Euro Area and UK IP and MFG | |||||||
|---|---|---|---|---|---|---|---|
| Saar except m/m | Mo/Mo | Dec-07 | Dec-07 | Dec-07 | |||
| Euro Area Detail | Dec-07 | Nov-07 | Oct-07 | 3-Mo | 6-mo | 12-mo | Q-2-Date |
| MFG | 0.0% | -0.5% | 0.6% | 0.2% | 1.3% | 1.1% | -1.0% |
| Consumer | 0.1% | -0.5% | 0.3% | -0.9% | 0.3% | -0.2% | -2.3% |
| Consumer Durables | 0.0% | -1.9% | -0.1% | -7.8% | -4.9% | -4.0% | -- |
| Consumer Nondurables | -0.1% | -0.2% | 0.2% | -0.4% | 0.8% | 0.2% | -- |
| Intermediate | 0.3% | -0.7% | 0.6% | 0.5% | 0.6% | 0.2% | -1.5% |
| Capital | -1.0% | -0.2% | 1.0% | -0.7% | 2.4% | 2.5% | 0.5% |
| Main Euro Area Countries and UK IP in MFG | |||||||
| Mo/Mo | 105.2 | 105.2 | 105.2 | ||||
| Memo: MFG | 1-Mo% | 1-Mo% | 1-Mo% | 3-Mo | 6-mo | 12-mo | Q-2-Date |
| Germany: | 0.9% | -0.2% | 0.0% | 3.0% | 6.1% | 5.3% | 3.4% |
| France: IP excl Construction | 0.7% | -1.7% | 2.0% | 3.9% | 3.3% | 1.2% | 1.1% |
| Italy | -0.5% | -1.7% | -0.8% | -11.5% | -6.7% | -6.4% | -10.8% |
| Spain | -1.5% | -6.7% | 10.2% | 5.5% | -3.3% | -0.3% | 2.9% |
| UK | -0.2% | -0.1% | 0.3% | 0.0% | -0.8% | 0.0% | -0.5% |
Robert Brusca
AuthorMore in Author Profile »Robert A. Brusca is Chief Economist of Fact and Opinion Economics, a consulting firm he founded in Manhattan. He has been an economist on Wall Street for over 25 years. He has visited central banking and large institutional clients in over 30 countries in his career as an economist. Mr. Brusca was a Divisional Research Chief at the Federal Reserve Bank of NY (Chief of the International Financial markets Division), a Fed Watcher at Irving Trust and Chief Economist at Nikko Securities International. He is widely quoted and appears in various media. Mr. Brusca holds an MA and Ph.D. in economics from Michigan State University and a BA in Economics from the University of Michigan. His research pursues his strong interests in non aligned policy economics as well as international economics. FAO Economics’ research targets investors to assist them in making better investment decisions in stocks, bonds and in a variety of international assets. The company does not manage money and has no conflicts in giving economic advice.
