Use access key #2 to skip to page content.

EconGrapher (< 20)

April 2010

Recs

2

Top 5 Graphs of the Week - 1 May 2010

April 30, 2010 – Comments (0)

This week we look at Q1 GDP results from the US and Republic of Korea, then we look at an interesting chart on US housing and confidence, then a brief snapshot of Japan with unemployment and deflation numbers, and finally a monetary policy review with emerging markets taking the spotlight.

1. US GDP
The US unsurprisingly pulled through some growth again in the first quarter of 2010 with an annualised 3.2% (i.e. actually 0.8% q/q) against consensus for 3.4%, and previous of 5.6%. Year on year growth moved up to 2.5% vs 0.1% in Q4 09. There are some interesting signs in this result compared to the previous one; December was all about the inventory cycle, but this quarter we're seeing strength in consumption (3.6% vs 1.6%), and continued strength in real business investment i.e. equipment and software as opposed to buildings (13.4% vs 19%). But net exports were down with imports growing faster than exports, also government consumption expenditure dropped off again. So while the figure came in slightly under there are some vaguely positive signs in there for now...
  [more]

Recs

3

Russian central bank cuts rate, looking for growth

April 30, 2010 – Comments (0)

 The Russian central bank, Bank Rossii, dropped the refi (refinancing rate) 25bps to 8% in order to encourage loan growth and further stimulate the economy; trading off potential increases in inflation with sustaining the recovery. The move marks the 13th reduction in the rate during the recession; down a total 500bps since the high of 13% in early 2009; but could be the last reduction. The following quotation is from the trusty (or somewhat rusty) Google translate of the announcement (which is only released in Russian):
  [more]

Recs

2

Brazil lifts selic rate 75bps to 9.5%

April 29, 2010 – Comments (0)

 Brazil stepped up its policy stimulus exit today, increasing the selic rate 75bps to 9.5%, the decision was unanimous. The move was only expected by half of economists surveyed, and most of those expecting an increase were looking for 50bps. In its announcement the BCB noted that the move marks a continuation of the policy adjustment process (having previously raised the reserve requirements in February):
  [more]

Recs

1

New Zealand holds interest rate - signals start to rate hikes soon

April 29, 2010 – Comments (0)

The RBNZ (Reserve Bank of New Zealand) held its key interest rate, the OCR, unchanged at a record low 2.50% but signalled that a start on the path to neutral monetary policy is imminent:

“As previously indicated, we expect to begin removing policy stimulus over the coming months, provided the economy continues to evolve as projected."  [more]

Recs

3

US Housing, Confidence, and Economic Outlook

April 28, 2010 – Comments (0) | RELATED TICKERS: SPX , QQQ , DIA

Here's a short sharp update on the US housing market, consumer confidence, and the direction of the US economy. The US S&P Case Shiller 20 Cities house price index rose 3% year on year in February, and was basically flat month on month. The figures indicate the housing market is still confused somewhat; consolidating before the next move... which could well be more sideways movement.  [more]

Recs

4

Economic Calendar: 26 April 2010

April 25, 2010 – Comments (0)

Here's the Economic Calendar for the week commencing 26 April 2010. This week there's monetary policy decisions from the US Fed, Reserve Bank of New Zealand, Bank of Japan; and sticking with monetary policy; inflation stats are due out for Australia, Germany, Japan, and the EU. Then of course there's the main event: Q1 GDP growth rate for the US, likewise, Canada will put out its February GDP figures. There's also an update on house prices in the US and UK, and the manufacturing PMI from China which is due for release on Friday.  [more]

Recs

2

OECD Economies: GDP Status Check

April 24, 2010 – Comments (0)

Where are the OECD economies at? In this article we take a unique approach to analysing the patterns of GDP growth across the OECD economies over the past 12 years. Why? Well for starters its nearing GDP season (Q1 results will be out for a few countries soon, the UK has already announced its Q1 2010 results). Second, it's useful to occasionally challenge your perceptions about which countries are growing and which aren't. Third, it's a timely status check in terms of the overall recovery across the OECD economies.   [more]

Recs

2

Top 5 Graphs: Inflation risks rising

April 23, 2010 – Comments (0)

Are upside inflation risks rising in developed economies? That's one question we look at in this week's edition. First up is a synopsis of the UK GDP figures, then a look at rising British inflation, the Bank of Canada decision and inflation rate, the surge in US producer prices, and a look at New Zealand inflation. Overall the theme is that there are indeed signs of increasing inflation risks for these developed economies, and even though some of the short term drivers may be temporary there is the risk that they have a lasting impact.  [more]

Recs

3

Economic Calendar: IMF Takes the Spotlight

April 18, 2010 – Comments (0)

Here's the Economic Calendar for the week commencing 19 April 2010. The key data out this week is UK GDP, New Zealand CPI, Bank of Canada Monetary Policy decision, EU consumer confidence, and US home sales data and durable goods orders. But also on the radar this week is the April 2010 IMF World Economic Outlook (and the IMF Global Financial Stability report, due out the day before) which is always a tremendous resource for global economic analysis (the 3rd and 4th analytical chapters are already up here and look at unemployment dynamics during recessions and recoveries, and transitioning out of sustained current account surpluses). Also in the IMF sphere are the G20 and IMF/World Bank meetings on Friday and Saturday this week.  [more]

Recs

1

Top 5 Graphs - US Sees Positive SIgns, But How Positive?

April 16, 2010 – Comments (0) | RELATED TICKERS: SPX , QQQ , DIA

This week we look at the US trade balance trending back to normal, US CPI/inflation figures tending sideways, a pick up in US retail sales, further improvement in US industrial production, and a slight tapering off of US consumer sentiment. So the focus is completely on the US this week which is fitting given our update on the Chinese economy a few days ago following their big economic data release. So this week you've got the top 5 graphs for the 2 biggest economies.

SEE FULL ARTICLE (GRAPHS) HERE: http://www.econgrapher.com/top5graphs17apr.html  [more]

Recs

4

Top 5 Graphs - China Grows and Faces Challenges

April 15, 2010 – Comments (0)

China just released its quarterly data smorgasboard, showing the nation grew 11.9% year on year in the first quarter of 2010. It also revealed its inflation situation, consumer spending trends, and industrial production activity levels. In this review we analyse each data set in terms of what it means for the outlook for the Chinese economy, we also look at the quarterly figures for Chinese international trade.

1. GDP lifted further by stimulus
The Chinese growth miracle continued into the first quarter of 2010 with 11.9% GDP growth year over year. This compares to an expected 11.7%, and Q4 09 of 10.7%, and much improved compared to Q1 09 6.1%. However the growth is largely artificial - or to be fair most of it is artificial. If you look at the figures coming out in 2007 which were also in the double digits, that growth rate had been gradually built up to. If you look at the chart below you have a significant drop-off and were it not for the massive stimulus you would see growth stagnating and drifting sideways if not downward like most other economies. The trick is, what happens next? what happens when the stimulus is removed - or in other words, how long will it take for the Chinese economy to -really- recover?

2. CPI - China will face heightened inflationary pressure
China's CPI year on year percent change inflation figure came in at 2.4% against 2.7% in Feb, and -1.2% in March 2009. As I've previously pointed out the probable trajectory for Chinese inflation is up. The leading indicator points to a rapid uptick in inflation, and huge lending growth, and huge money supply growth can only support inflationary conditions. What's more the triple effect of markets; commodities, stocks, and most of all real estate have already started pushing up headline inflation. Unless the People's Bank of China adjusts policy soon, or the yuan policy gets changed, it's likely that China will see a marked pick up in average inflation.

3. Retail Sales - Chinese consumers still buying more
Another interesting piece of information in the release was Chinese retail sales - one of the best measures we have of Chinese domestic consumption. Sales in March were 1,132 billion yuan; down 8% from February (likely to be driven primarily by seasonal factors such as Chinese New Year). Year on year the growth rate reduced to 18%. The March 2009 figures were 932 billion yuan (up 14.7% year on year). So what we have overall though is increasing growth in domestic consumption. The overall volume of sales is still growing, but also the rate of growth is returning to pre-crisis levels. But then again; were it not for subsidies e.g. appliance purchases, perhaps volumes would have gone sideways.


4. Industrial Production - Helped by consumption, stimulus, and exports
Chinese industrial production picked up further in March to 18% from February's 13%. Again this is an obvious after effect of massive stimulus spending. But it is also benefiting distinctly from the global inventory cycle and related pick up in international trade. Chinese exports (and imports) have recovered strongly since the bottom, but also - there is the domestic spending aspect to it. As you saw above, Chinese consumers have kept on spending and at increasing rates - so obviously production needs to occur to meet demand. But slicing and dicing it these ways really just shows that it's not all that fundamentally driven yet - so where's the real recovery? (where is the structural recovery?).

5. International Trade - Interesting patterns unfolding
One of the most contentious issues these days is the yuan and China's international trade. The March quarter saw China's lowest surplus in about 4 or 5 years, due to exports recovering slowly, but demand for imports rising (and prices of key imports i.e. commodities, rising). But the long term trajectory of China's trade figures is up, up, up. Where its surplus goes will be determined largely by the global recovery, but also its trade policies and strategies. In the longer term, as a low cost competitor China will eventually lose some market share as production of exports shifts to lower cost developing and emerging markets. So that leaves China with some interesting strategic challenges.

In summary, it's always great to get more data from China. It is after all the world's second largest economy, and most populous nation. The long term growth story for China remains intact, short term issues though they may face; not least of all sustainability (environmentally and otherwise). The trend has been for retail sales to grow, this is good for potential import growth and for those investing in the right consumer products companies. The trend has also been for consistently high economic growth, this is good for the Chinese, and those who trade with them.

In the shorter term, the trend has been for increasing inflation, and massive - massive stimulus spending and policy measures. These aren't necessarily bad things - but they must be kept firmly on the radar. They pose threats and opportunities for the various interest groups and stakeholders (think about this). Also in the short term, trade has taken an interesting - but likely transitory - pattern of reversing into greater import growth than exports. These two issues paired with the Yuan policy make for an interesting mix for this year. Keep watching...

Sources:
Econ Grapher Analytics www.econgrapher.com
National Statistics Bureau www.stats.gov.cn

Article Source: http://www.econgrapher.com/15apr-china.html  [more]

Recs

1

New Zealand Consumer Spending and Housing Market

April 14, 2010 – Comments (0)

New Zealand released its retail sales figures today, revealing soft figures; affirming suspicions that the recovery is still weak. Sales declined -0.6% from January (where sales rose 0.7%), disappointing those predicting a 0.2% rise. The NZD sold-off sharply against the USD following the release, dropping about 50 bps before returning to pre-announcement levels at around 0.71 (NZDUSD).  [more]

Recs

5

China Trade Review - March Deficit

April 10, 2010 – Comments (1) | RELATED TICKERS: CNY , CYB

China reported its first monthly trade deficit in 6 years during March as imports surged. The trade deficit for March was -$7.24 billion, compared with consensus estimates for -$0.39 billion, and February's +$7.60 billion, and March 2009 surplus of +$18.6 billion.

  [more]

Recs

3

Top 5 Graphs of the Week: Growth, Inflation and Monetary Policy

April 09, 2010 – Comments (0) | RELATED TICKERS: CNY , SPX

This week we look at rising Chinese inflation expectations, signs of improvement in the US non-manufacturing sector, revisions to EU 4th quarter GDP growth, Australian jobs growth, and finish with a review of some of the monetary policy decisions announced this week. The overall theme is pretty much one of growth, inflation, and monetary policy; one that will become increasingly interesting this year.

1. China inflation expectations
The data in this chart isn't new, but it's probably unknown to most people. The March quarter price expectations index came out in mid-March at 65.6, down from 73.4 (compared to the low in December 2008 of 6.1). This is a startling graph from an inflation point of view, as in the past the future price expectation index has reliably tracked very closely to CPI inflation, and has been a strong leading indicator. So what can you take from this chart? Basically inflation in China is set to rise, and the fundamentals support the idea too; large stimulus spending, rapid loan growth, rapid money supply growth, and commodity price recovery. You could easily argue with this kind of chart that China hasn't done enough on the monetary policy tightening front yet.

  [more]

Recs

2

Japan Holds Rate, Faces Critical Challenge of Deflation

April 07, 2010 – Comments (0)

The Bank of Japan decided to "encourage the uncollateralized overnight call rate to remain at around 0.1 percent." The decision was driven by the "critical challenge" of deflation.

Jumping to the last paragraph of the Statement on Monetary Policy, it's clear that the rate will stick around 0.10% for some time:
"The Bank recognizes that it is a critical challenge for Japan's economy to overcome deflation and return to a sustainable growth path with price stability. To this end, the Bank will continue to consistently make contributions as central bank. In the conduct of monetary policy, the Bank will aim to maintain the extremely accommodative financial environment."

But it's not all gloom and doom for Japan, in fact Growth has finally turned positive thanks to a recovery in international trade.

  [more]

Recs

3

Australia Tightens Monetary Policy, Who's Next?

April 06, 2010 – Comments (0)

The RBA (Reserve Bank of Australia) increased its benchmark interest rate 25 basis points to 4.25%, making it the 5th increase this tightening cycle. The move was a close call and was only predicted by about half (13 of 23) of economists surveyed by Bloomberg.

  [more]

Recs

1

Where to find economic data

April 03, 2010 – Comments (0)

There have been numerous comments on my previous post about how useful it was. So I've decided to re-post this for any of those who might have missed it....   [more]

Recs

6

Top 5 Graphs of the Week: China, Japan, EU, US

April 02, 2010 – Comments (1)

After a few weeks of absence, and back by popular demand, here's the top 5 graphs of the week. This week we look at the Asian powerhouses; China's PMI, Japan's influential quarterly Tankan survey and February international trade stats. Then we look at the western powers with EU unemployment and inflation, and a review of the US employment numbers.

To boil it down a little, there's further signs of strength and improvement in China, slightly positive signs in Japan's slow and fragile recovery; ominous signs in the EU with inflation and unemployment rising; and a positive result in the US employment figures even spurring some to call an official end to the recession...

1. China PMI signals a robust manufacturing sector
The Chinese economy showed signs of further strengthening with the release of the March PMI; the official CFLP figure was 55.1, up from 52 in Feb. The figure was in line with estimates, and in the same direction as the HSBC PMI index (57 vs 55.8). The positive figure in some ways confirms the reversal of some stimulus measures thus far and will likely add justification to further removal of stimulus as concerns of overheating certainly trump concerns about the strength of the economy. It may even add to the case of moving on the CNY, which is likely to occur this year - perhaps sometime around mid-year.
  [more]

Recs

9

Sourcing Economic Data

April 01, 2010 – Comments (6)

Here’s an Easter special; this article is about efficiently sourcing economic data. Traditionally what you will do if you want to know e.g. US GDP data is to go to the official website (i.e. the Bureau of Economic Analysis) or if you want to know Chinese CPI you go to the National Bureau of Statistics website. But this article is more about how to efficiently and easily find all sorts of economic data in single (or a few) sources.

For the most part the data in the sources described below is still very reliable, and tends to be easily or directly comparable to other countries on the same database. So it cuts down time used in searching for (and through) official statistics websites, and reduces problems about comparability.

So here they are, the top 5 sources for free, easy to use, easy to compare economic statistics:

1. IMF (International Monetary Fund)
The IMF has a wealth of information available on a yearly basis within its World Economic Outlook databases. You can find statistics on GDP, Balance of Payments, National Debt, Government Debt, Inflation, Population, International Trade, and so-on. The upside is that the data is authoritative and reliable, and exists for many different countries, and often has projections or forecasts out a few years. The downside is that the data is generally only available on an annual or yearly frequency.

Link: http://www.imf.org/external/ns/cs.aspx?id=28

2. OECD (Organisation for Economic Cooperation and Development
Somewhat similar to the IMF, the OECD data is equally authoritative, but generally much more detailed. OECD provides aggregated statistics on a quarterly as well as annual basis, and for some data sets on a monthly basis. For example you can find quarterly GDP figures on their free database. The downside is that it basically only covers OECD countries (plus a small handful of others e.g.China).

Link: http://stats.oecd.org/index.aspx

3. Trading Economics
Trading Economics is a reasonably new source. It is a private organization and as such is starting to charge for its data/analysis. But there is still a wealth of data available on the website for free. Trading Economics tends to update more quickly than the IMF and OECD databases, also it tends to have more trading/markets/investing related data e.g. indicators like consumer confidence, industrial production, etc. They've also recently expanded their data sets to include commodities, bonds, etc; overall somewhat like a web-based Bloomberg. Trading Economics is definitely worth a look.

Link: http://www.tradingeconomics.com/

4. Free Lunch (Moody’s Economy.com)
Similar to Trading Economics, Free Lunch is a private source (owned by the rating agency, Moody's). There is a wealth of free and paid information available on Free Lunch, but the main drawback is that it’s mostly focused on the US market (unless you want to pay). Still it’s a source worthy of note.

Link: http://www.economy.com/freelunch/

5. FRED (Federal Reserve Bank of St. Louis)
Last but not least is the FRED database on the Federal Reserve Bank of St. Louis website. The FRED database is a great resource as it allows you to compose graphs on-screen through a variety of time periods, styles, and datasets. However similar to Free Lunch, FRED also primarily focuses on the US economy; but if that’s what you’re interested in then this is a key resource for you.

Link: http://research.stlouisfed.org/fred2/

Conclusion
This list is almost certainly not exhaustive, (for instance you could also invest in a Bloomberg terminal if you have the resources) but if you know of any other good aggregated economic data sources worthy of mention then please let me know or post a comment. Ultimately though the data is only as good as the analysis, and more importantly it only really tells you where we’ve been. Also the data tends to be at a high level; so if you want greater detail you’ll need to go to the original source. Anyway if you’re a regular consumer of economic data and market news it pays to be aware of these websites and to make good use of them.

Article Source: http://www.econgrapher.com/econdata.html  [more]

Recs

2

US PMI Show Activity Growing, But Will It Last?

April 01, 2010 – Comments (0) | RELATED TICKERS: DIA , QQQ , SPX

The US ISM PMI came in at 59.6, beating estimates of 57 (ranging from 54 to 59), and February's 56.5 and showing further strengthening of the US manufacturing sector. A level over 50 indicates expansion. Much of the strength in the ISM numbers has been explained away by stimulus spending and inventory cycle, and the impulse from these drivers is probably still present. But there are some emerging signs that there could be glimmers of underlying strength starting to take hold too.

The chart below shows the main PMI index with the key leading indicator of new orders (still pretty strong by recent historical standards), and the employment index (which is still showing jobs net higher, albeit 1 point off). The chart points to a pretty sharp recovery, but obviously challenges still remain ahead.

  [more]

Featured Broker Partners


Advertisement