GlobalPolitics has continued to dominate the headlines in recent days and will doubtless remain a big focus in the immediate weeks ahead. In the background, however, incoming data have suggested the outlook for the world economy has been darkening (chart 1) probably because more restrictive policy settings are now more forcibly weighing on aggregate demand (charts 2 and 3). However, still-sticky service sector inflation (chart 4) could postpone any moves to (further) ease the stance of monetary policy not least if traded goods price inflation now begins to stir (chart 5). This week’s evidence suggesting robust demand for semiconductors has continued to support global trade also serves as a reminder that there are some tailwinds behind the world economy at present that are countering policy-related headwinds (chart 6).
USA| Jul 25 2024U.S. GDP Growth Strengthens in Q2’24; Rise in Price Index Slows
- Growth doubles the Q1 increase.
- Inventories & government spending lead growth.
- Consumer spending & business investment gains improve.
- Price increase moderates.
by:Tom Moeller
|in:Economy in Brief
USA| Jul 25 2024U.S. Durable Goods Orders Unexpectedly Drop in June
- A sharp 6.6% m/m fall in June following four straight m/m rises.
- Nondefense aircraft orders plummet 127.2% m/m.
- Transportation orders plunge 20.5% m/m; excluding transportation, orders rise 0.5% m/m.
- Core capital goods shipments up only 0.1% m/m vs. a 0.7% May decline.
- Durable goods shipments up, unfilled orders down, and inventories unchanged.
USA| Jul 25 2024U.S. Initial Unemployment Insurance Claims Drop in Latest Week
- Initial claims dropped 10,000 in the week ended July 20.
- Continuing claims dropped 9,000 in the week ended July 13.
- Insured unemployment rate holds steady.
Belgium| Jul 25 2024Belgian Bank Index Shows Still Weak Industry
The Belgian National Bank index in July weakened to -12.3 from -11.1 in June. The -12.3 reading is the weakest since it was -12.8 in February. The index has not weakened greatly; however, instead it has languished in the -10 to -11 region. July stepped down to the -12 region, indicating ongoing morass for Belgian industry. The three-month change in the index worsened by 0.4 points; however, over six months it improved by 4.1 points, but over 12 months it improved by only 2.5 points. There is some improvement in the history, but the improvement over six months is stronger than over 12 months, a good sign except that over three months some of that gain has been given back. This leaves the trend in an uncertain situation.
The standing for the index is in its 14.3 percentile which leaves it very low in its queue of historic readings. Manufacturing alone has a 17-percentile standing, slightly better than for total industry, but still not too different from the total industry mark that is poor.
Manufacturing worsened in July to -14.9 from -13.1 in June. The production trend for manufacturing, however, has improved slightly, rising from -3 in May to -2 in June to -1 in July. The July reading is its best since a rogue improvement brought the index to zero in March. Setting that aside, this is the strongest reading since June 2023.
The domestic order trend, on the other hand, is weak and somewhat worrisome. In May the reading was -7; in June it fell sharply to -19 and in July it stayed in that region with the -20 reading. The domestic portion of demand for Belgian industry has weakened significantly in the last two months and stayed at that weaker posture.
Foreign demand during this period weakened as well. The foreign order trend in May was 0 that weekend -5 in June and improved only slightly to -4 in July.
Price trends show negative readings in May and June that turned to a positive reading of plus one in July.
USA| Jul 24 2024U.S. New Home Sales Ease as Prices Rise in June
- Sales fall to seven-month low.
- Median sales price recovers May decline.
- Changes are mixed throughout the country.
by:Tom Moeller
|in:Economy in Brief
USA| Jul 24 2024U.S. Goods Trade Deficit Narrows to $96.84 Billion in June
- A three-month low and the first narrowing since December.
- Exports rebound 2.5% in June, the second m/m gain in three months.
- Imports rise 0.7% m/m vs. a 0.7% May drop.
- Mortgage applications fall in three of last four weeks.
- Home purchase applications decline while refinancing edges higher.
- Mortgage interest rates continue to fall.
by:Tom Moeller
|in:Economy in Brief
- of2573Go to 39 page