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Daily Macroeconomic Digest

Wednesday 20 November
Lower energy and basic prices have weighted down on German PPIs

Germany: PPI (Oct.): -0.2% m/m vs 0% expected (prior: 0.1%)

  • Prices of basic goods and energy have fallen over the month, while prices were up by modest 0.1% m/m in other sectors.

  • Yearly trend has weakened further from -0.1% y/y the prior month to -0.6% y/y.


Russia: Retail sales (Oct.): 1.6% y/y vs 1% expected (prior: 0.7%)

  • Monthly and yearly trend on sales have both accelerated.


Russia: Real wages (Sept.): 3.1% y/y vs 2.9% expected (prior: 2.4%)

  • Real wage growth has recently accelerated thanks to declining inflation, and has supported firmer consumption.

Tuesday 19 November
Strong rebound of US housing starts and building permits

US: Housing starts (Oct.): 1314k vs 1320k expected (prior: 1266k revised from 1256k)

  • Building permits: 1461 k vs 1385 k expected (1391 k prior month revised from 1387 k).

  • Housing starts have strongly rebounded after past month fall; multifamily houses were volatile in the past months, while single family houses remained on a steady rise.

  • The rebound in building permits was also strong, fueled by the two categories of houses. Housing should remain on a positive trend in Q4 after its rebound in Q3, despite volatile long-term bond yields.


Switzerland: Trade balance (Oct.): 3.5 Bn CHF (prior: 4.05Bn)

  • Real exports: -1.3% m/m; real imports: -2.4% m/m. The trend in exports remained negative, despite temporary rebound past month.


Italy: Industrial orders (Sept.): 1% m/m (prior: 0.8% revised from 1.1%)

  • Orders have regained further on both domestic and foreign sectors; industrial sales were up by 0.2% m/m, only driven by domestic sales.

  • Trend in orders has recovered from -10% y/y the prior month to 0.3% y/y, but trend in sales remained negative.

Monday 18 November
NAHB index edges lower


US: NAHB housing market index (Nov.): 70 vs 71 expected (prior: 71)

  • Homebuilder sentiment eased for the first time in 5 months but is still close its cyclical high (reached in December 2017) after a sustained rebound this year.
  • However, the gauge of builder optimism about sales over the next six months rose to the highest since May 2018 (while current sales component declined).
  • Lot shortages, lack of labor and regulatory constraints remain the main issues for builders while low borrowing costs and a solid job market continue to fuel demand.


Russia: Industrial production (Oct.): 2.6% y/y vs 2.5% expected (prior: 3.0%)

  • Industrial production was up 5.5% m/m in October after +2.7% in September.


Friday 15 November
US: retail sales report were mixed and disappointing industrial production

US: Empire manufacturing (Nov): 2.9 vs 6 expected (prior: 4)

  • Sentiment has eased on lower prices paid, inventories and shipments but new orders and conditions have rebounded.

  • Importantly, the 6-month outlook business conditions and activity components, including in orders and employment have improved.


US: Retail sales (Oct): 0.3% m/m vs 0.2% expected (prior: -0.3%)

  • The headline appeared to be stronger than expected, but underlying details and revisions made to prior months made for a considerably weaker outcome. The composition of October sales showed relatively broad-based weakness. Discretionary spending categories, including furniture (-0.9% vs. 0.7 prior), electronics (-0.4% vs. 0.1%), sporting goods (-0.8% vs. -0.1% prior) and restaurant sales (-0.3% vs. 0.8% prior) all saw significant declines in the month.

  • Retails sales excluding auto and gas, the category which more closely tracks consumer underlying demand, only increased 0.1%. That missed expectations (0.3% expected) following a 0.1% decline in the previous month.

  • Control retail sales that is used in GDP calculation GDP rose (as expected), offsetting the previous month's decline.


US: Industrial production (Oct): -0.8% m/m vs -0.4% expected (prior: -0.3% revised from -0.4%)

  • Auto production has shown a sharp contraction related to the strike at GM. The weakness was not confined to the vehicle sector. Manufacturing output excluding vehicles fell for a second month, concentrated in business and construction supplies as well as materials.

  • The coming months are likely to show a clear rebound as strike effects abate.


Eurozone: CPI (Oct F): 0.1% m/m vs 0.2% expected (prior: 0.2%)

  • Core inflation rose slightly to 1.1% from 1% in September due to stronger contributions from clothing prices and airfares.

  • The headline inflation rose by 0.7% y/y (down from 0.8% y/y in September). Most of the decline was driven by lower energy prices (-3.1% y/y).

Thursday 14 November
Q3 German growth stronger than expected

US: PPI (Oct.): 0.4% m/m vs 0.3% expected (prior: -0.3%)

  • Prices have rebounded after the fall the prior month; prices of food, energy and trade services were on a strong rebound after their fall in Sept.

  • Yearly trend has moderated on base effect, from 1.4% y/y to 1.1% y/y; core PPIs were up by 0.1% m/m ( flat past month) and were up by 1.5% y/y after 1.7% y/y.


US: Initial jobless claims (Nov.9): 225k vs 215k expected (prior: 211k)

  • Continuing claims: 1683 k after 1693 k past week.


Germany: GDP (Q3-19): 0.1% q/q vs -0.1% expected (prior: -0.2% revised from -0.1%)

  • First estimate pointed to a more resilient growth than expected, thanks to consumption, residential construction and public spending; investment and exports remained weak.

  • The manufacturing sector remained fragile, but the growth outlook should progressively improve next year.


France: Unemployment rate (Q3-19): 8.6% vs 8.4% expected (prior: 8.5%)

  • Unemployed has increased by 10 k after -70 k past quarter.


France: CPI (Oct.): -0.1% m/m as expected (prior: -0.4%)

  • Inflation was in line with the first estimate. The monthly fall was mainly due to falling food prices.

  • Yearly trend has eased from 1.1% y/y to 0.9% y/y.


Spain: CPI (Oct.): 0.7% m/m vs 0.6% expected (prior: 0.4%)

  • Inflation remained on a weak trend (0.2% y/y) in final data. The monthly rebound was driven mainly by clothes, and also by food and education costs.


Poland: GDP (Q3-19): 1.3% q/q vs 1.1% expected (prior: 0.8%)

  • Preliminary data pointed towards a rebound in growth.


Switzerland: PPI-import prices (Oct.): -0.2% m/m vs -0.1% expected (prior: -0.3%)

  • Import prices were down by 4.7% y/y (-4% y/y the prior month) and producer prices were down by 2.4% y/y (-2% y/y the prior month).


UK: RICS house price balance (Oct.): -5% vs -3% expected (prior: -3% revised from -2%)

  • Balance of sentiment among professionals has rebounded on sales, was less negative on prices, but remained cautious on future sales and new buyers.


UK: Retail sales (Oct.): -0.1% m/m vs 0.2% expected (prior: 0%)

  • Sales have shown a modest but broad-based contraction across sectors over the month; internet sales have regained (0.8% m/m) after two months contraction.

  • Yearly trend in sales remained healthy at 3.1% y/y.


Turkey: Industrial production (Sept.): 3.2% m/m (prior: -2.7% revised from -2.8%)

  • The yearly trend has also rebounded to 3.4% y/y after -3.6% y/y the prior month. The monthly rebound was driven by intermediate, capital and non-durable consumer goods.

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