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Daily Macroeconomic Digest

Wednesday 03 March
Higher PMI services globally but lower than expected ADP survey and ISM non-manufacturing in the US

US: ADP Employment change (Feb.): 117k vs 200k expected (prior: 195k revised from 174k)

  • Job creations came lower than expected, but prior month data were revised up.
  • Creations were still sustained in services (131k), driven by trade, transport, business services and education. On the opposite, creations turned negative in good producer sectors.
  • The next non-farm payrolls expected by Friday could come lower than expected (195 k) based on this proxy.


US: Markit Services PMI (Feb.): 59.8 vs 58.9 expected (prior: 58.3)

  • Final index was higher than past month and first estimate; opinions on new business and on prices have increased from the prior month.


US: ISM Non-manufacturing (Feb.): 55.3 vs 58.7 expected (prior: 58.7)

  • Contrary to PMI, ISM services index has decreased after the rise seen the prior month.
  • Sentiment has weakened on activity, new orders, employment and imports while it has increased for backlog of orders, inventory, supply delivery and prices paid.
  • Still constraints on services and disruption in some sectors have weighed on the index, which remains in line with average level seen in 2016-17.


Eurozone: PMI Services (Feb.): 45.7 vs 44.7 expected (prior: 45.4)

  • Business confidence in services was more resilient than expected and slightly increased from the prior month.
  • Situation by country has shown large divergence: a strong rebound in Italy, lower than expected index in Germany, lower from prior month but resilient in France and better than expected, and higher in Spain.
  • Activity remained constrained by lockdown in place, but at different degree according to national lockdowns.


UK: PMI Services (Feb.): 49.5 vs 49.7 expected (prior: 39.5)

  • The final index has strongly rebounded but came just slightly below expectations.
  • Vaccination roll out and prospects of gradual reopening have boosted views on future activity. On current situation, some sectors remained under constraints due to lockdown (leisure, hospitality) and restrictions on trade (Brexit, restrictions on global travel).
  • Both services and manufacturing PMI have increased from the prior month, pointing towards sustained recovery in the next quarters.


Switzerland: CPI (Feb.): 0.2% m/m vs 0.4% expected (prior: 0.1%)

  • Prices of clothes, energy-oil have strongly increased over the month, while food prices have declined.
  • Core inflation was up by 0.1% m/m after -0.2% m/m the prior month.
  • Yearly trend remained unchanged at -0.5%y/y; core inflation has turned back negative (-0.3% y/y) after 0.1% y/y the prior month.


Eurozone: PPI (Jan.): 1.4% m/m vs 1.5% expected (prior: 0.9% revised from 0.8%)

  • Prices of energy and intermediate goods have strongly increased over the month.
  • Yearly trend has accelerated from -1.1% y/y the prior month to 0% y/y.
  • Higher energy and intermediary good prices were also reflected in higher prices paid in PMI surveys and should be seen within headline CPI in the coming months.


Turkey: PPI (Feb.): 1.22% m/m vs 0.7%$ expected (prior: 2.66%$)

  • Prices were up by 27.09 % y/y from 26.16 % y/y the prior month.


Turkey: CPI (Feb.): 0.91% m/m vs 0.7% expected (prior: 1.68%)

  • Prices were higher than expected due to strong rise in food, health and restaurants prices.
  • Yearly trend has accelerated from 14.97% y/y the prior month to 15.61% y/y, and core inflation from 15.5% y/y to 16.21% y/y.
  • These strong figures pave the way to another rate hike from the central bank.
Tuesday 02 March
Germany: rising unemployed (Feb.) and depressed sales (Jan.)

UK: Nationwide house prices (Feb.): 0.7% m/m vs -0.3% expected (prior: -0.2% revised from -0.3%)

  • Prices have rebounded after the fall seen in Jan. and were back on positive trend.
  • Yearly trend has accelerated further, from 6.4% y/y the prior month to 6.9% y/y.


Eurozone: CPI estimate (Feb.): 0.9% y/y as expected (prior: 0.9%)

  • First estimate for inflation pointed towards stable yearly trend; price were up by 0.2% m/m (as in the prior month): food prices were up by 0.2% m/m, energy up by 0.9% m/m, services up by 0.3% m/m and manufactured goods down by 0.2% m/m.
  • Core inflation was up by 0.1% m/m and its yearly trend declined from 1.4% y/y the prior month to 1.1% y/y.


Germany: Retail sales (Jan.): -4.5% m/m vs 0.3% expected (prior: -9.1% revised from -9.6%)

  • As tight lockdown was in place, spending remained depressed, but was less negative than the prior month.
  • Except health and food sectors, all other sectors have shown another monthly double-digit contraction.
  • Despite weak start, consumer confidence has turned slightly less negative in Feb., but Merkel still favors ongoing lockdown.


Germany: Unemployment rate (Feb.): 6% as expected (prior: 6%)

  • Unemployed has increased by 9 k versus expectations of -10K (-37k the prior month).
  • After several months of regular declines in unemployed, monthly figures have slightly rebounded despite still existing public support to workers and firms.
  • Some members in Merkel's government argue in favor of easier conditions in some sectors in March.
Monday 01 March
Strong rebound in business manufacturing sentiment

US: Markit Manufacturing PMI (Feb.): 58.6 vs 58.5 expected (prior: 59.2)

  • Business sentiment has decreased from the prior month, but slightly less than in first estimate.
  • Sentiment remained positive on production, orders and export orders; disruption and shortages have impacted the supply chain and prices paid remained on the rise, with some pass through to final clients.


US: ISM Manufacturing (Feb.): 60.8 vs 58.9 expected (prior: 58.7)

  • The index has strongly rebounded from the prior month and the index was back to its high levels seen in 2017-18.
  • All sub-components have shown a strong monthly rise, driven by orders, production and export.
  • Many comments from different industries have pointed towards shortages in production, transport and on employment.
  • Index on prices paid has reached a very high level, pointing towards ongoing building pressures from costs.


US: Construction spending (Jan.): 1.7% m/m vs 0.8% expected (prior: 1.1% revised from 1%)

  • Construction of residential single houses remained on a sustained monthly trend.


Eurozone: PMI Manufacturing (Feb.): 57.9 vs 57.7 expected (prior: 54.8)

  • Final data have shown a stronger than expected rebound from initial estimates for all major countries over the month.
  • Confidence has rebounded on production, new orders and exports; rising delivery time was due to disruption in production and transport of some inputs; prices paid remained on the rise and employment is better oriented.
  • The index is now close to the highs seen in 2017-18.


Italy: CPI (Feb.): -0.2% m/m vs -0.4% expected (prior: -0.9% revised from -1.1%)

  • Final data confirmed lower prices of clothes and goods over the month, versus rising energy and transport costs.
  • Yearly trend has increased from 0.7% y/y the prior month to 1% y/y.


Poland: PMI Manufacturing (Feb.): 53.4 vs 52.9 expected (prior: 51.9)

  • A stronger than expected rebound; new orders were up over the month.


UK: PMI Manufacturing (Feb.): 55.1 vs 54.9 expected (prior: 54.1)

  • Business confidence has increased more than expected over the month.
  • Sentiment has improved on production, new orders and exports (from Asia, the US and continental Europe).
  • Disruption in transport and Brexit put constraints in manufacturing supply chain; prices paid were on the rise and employment has also increased.
  • The index was back to its 2018-18 level.


UK: M4 (Jan.): 13.3% y/y (prior: 13.5% revised from 13.4%)

  • M4 lending was up by 3.9% y/y, stable trend from the prior month. M4 ex IOFC was up by 12.8% y/ y after 12.7% y/y the prior month.


Switzerland: PMI Manufacturing (Feb.): 61.3 vs 60.1 expected (prior: 59.4)

  • Sentiment has strongly increased from the previous month; sentiment was higher on production, orders and prices paid; the outlook has slightly improved on employment.


Germany: CPI (Feb.): 0.6% m/m vs 0.5% expected (prior: 1.4%)

  • Final inflation was sustained due to energy and food prices over the month.
  • Yearly trend remained stable at 1.6% y/y from the prior month.


Norway: PMI (Feb.): 56.1 (prior: 52.5 revised from 51.8)

  • A strong rebound in sentiment, driven by better outlook on production.


Sweden: PMI Manufacturing (Feb.): 61.6 (prior: 62.5 revised from 62.4)

  • Some weakening sentiment from high level, due to lower orders and several disruptions in trade and production.


Norway: Retail sales (Jan.): -0.1% m/m (prior: -5.7%)

  • Weak start with declines in auto and goods purchased.


Turkey: PMI Manufacturing (Feb.): 51.7 (prior: 54.4)

  • The index has declined from the prior month. But remained above the 50 level. Sentiment on new orders has declined below 50 over the month.


Turkey: GDP (Q4-20): 1.7% q/q vs 3.9% expected (prior: 15.9% revised from 15.6%)

  • GDP growth came lower than expected in Q4; consumption was up by 1.7%q, investment up by 1.2%q and public consumption up by 0.8%q.
Friday 26 February
Strong rebound of US personal income (Jan.); falling French consumption (Jan.)

US: Wholesale inventories (Jan.): 1.3% m/m vs 0.4% expected (prior: 0.5% revised from 0.3%)

  • Inventories have increased for wholesalers but declined for retailers over the month.


US: Personal income (Jan.): 10% m/m vs 9.5% expected (prior: 0.6%)

  • Disposable income has strongly rebounded (11.4% m/m) due to renewed unemployment and direct supports to households.
  • Separately, wages were up by 0.7% m/m after 0.5% m/m the prior month.


US: Personal spending (Jan.): 2.4% m/m vs 2.5% expected (prior: -0.4% revised from -0.2%)

  • Spending has rebounded from the prior month, due mainly to purchases of durable goods (8.4% m/m) while spending on service was modest (0.6% m/m).
  • Saving ratio has strongly rebounded from 13.4% the prior month to 20.5%.


US: Core PCE (Jan.): 0.3% m/m vs 0.1% expected (prior: 0.3%)

  • Headline PCE inflation was up by 0.4% m/m due to higher energy prices.
  • Yearly trend in core PCE remained quite stable at 1.5% y/y vs 1.4% y/y the prior month (revised from previous 1.5% y/y).


US: Chicago PMI (Feb.): 59.5 vs 61 expected (prior: 63.8)

  • The index was back to its Nov. level, being highly volatile past quarters but remaining at high level; besides uncertainty on economy, bad weather conditions may have weighed down on sentiment with lower production and more delivery concerns.


US: Consumer confidence (Michigan) (Feb.): 76.8 vs 76.5 expected (prior: 79)

  • The index was finally better than expected and in first estimate, but it has decreased from the previous month.
  • Sentiment on current situation has slightly decreased, while expectations have decreased more meaningfully (but less than expected, from 74 to 70.7) back to its Nov. level.
  • In details, the picture was mixed: volatile opinions around future personal financial situation, still positive outlook on future economy, but some concern on unemployment and easing in willingness to buy large items from the previous month.


France: Consumer spending (Jan.): -4.6% m/m vs -4% expected (prior: 22.4% revised from 23%)

  • With renewed lockdown, sales have sharply decreased for manufactured goods.
  • While spending on autos, food and energy, the sales of other manufactured goods were down by 25% m/m.
  • Sales should remain depressed in Feb. but could improve in March-April on easier restrictions.


France: GDP (Q4-20): -1.4% q/q vs -1.3% expected (prior: 18.5%)

  • Slightly more negative revisions to past Q4 GDP.
  • Consumption was down by 5.4% q, while net exports, residential and capex were positive over the quarter.
  • Q1-21 GDP should remain negative, but probably no more than 1% q contraction.


France: CPI (Jan.): 0% m/m vs -0.3% expected (prior: 0.3%)

  • While energy prices have strongly rebounded, prices of food and goods have decreased over the month; services were up modestly by 0.1% m/m.
  • Yearly trend stayed quite stable at 0.7% y/y after 0.8% y/y.


Spain: CPI (Jan.): -0.6% m/m vs -0.2% expected (prior: -0.4%)

  • First estimates pointed toward still negative trend in prices.
  • Yearly trend turned back negative: -0.1% y/y after 0.4% y/y the prior month.


Switzerland: GDP (Q4-20): 0.3% q/q vs 0% expected (prior: 7.6% revised from 7.2%)

  • Activity was more resilient than expected in Q4; consumption was down by 1.5%q but public consumption and capex were positive; exports and imports were both under contraction over the quarter.
  • As lockdown continued, a flat growth or moderate contraction is expected in Q1, unless activity rebounds sharply on easier restrictions in March. GDP has contracted by 2.9% in 2020.


Switzerland: KOF (Feb.): 102.7 vs 96.6 expected (prior: 96.5)

  • After several months of declining business confidence, the index has rebounded close to levels seen past Summer.
  • As seen in Germany, confidence in industry is building up despite still existing headwinds.


Sweden: GDP (Q4-20): -0.2% q/q vs 0.5% expected (prior: 6.4% revised from 4.9%)

  • Public and private consumption were both in contraction and investment was modestly positive (0.1% q). Net export contribution was more positive thanks to sharp rebound in exports over the quarter.


Norway: Unemployment rate (Feb.): 4.3% as expected (prior: 4.4%)

  • After strong rebound the prior month, the unemployment ratio has eased somewhat over the month.
Thursday 25 February
Firmer US durable good orders; improving business sentiment in the eurozone

US: Initial jobless claims (Feb.20): 730k vs 825k expected (prior: 841k revised from 861k)

  • Jobless claims have improved, but data could not be complete due to disruption in some states on bad weather conditions.
  • Continuing claims: 4419 k after 4494 k the prior week.


US: Durable goods orders (Jan.): 3.4% m/m vs 1.1% expected (prior: 1.2% revised from 0.5%)

  • Orders have strongly rebounded from the prior month due to a large surge in orders for non-defense aircrafts over the month.
  • Core orders were up by 0.5% m/m after 1.5% m/m the previous month, which is decent trend. Orders were up for metals and electrical equipment sectors.
  • Shipments were up by 2.1% m/m after 2% m/m; shipments for core orders were up by 2.1% m/m after 1% m/m.
  • Inventories were down by 0.3% m/m after -0.2% m/m the prior month; inventories for core orders were up by 0.3% m/m after 0.4% m/m the prior month.
  • Despite volatile monthly numbers, underlying trend is constructive for capex.


US: GDP (Q4-20): 4.1% q/q vs 4.2% expected (prior: 33.4%)

  • While consumption was slightly revised down (from 2.5% q to 2.4% q),  all components of investment were strongly revised up: capex (from initial estimate 24.9% q to 25.7% q), R&D (from 7% q to 8.5% q), residential (from 33.5% q to 35.8% q).
  • Inventories and investment contributions were both higher than in first estimates while net exports contribution was slightly more negative. Final sales were up by 4.4% q after 29.8 % q in Q3-20.


US: Pending home sales (Jan.): -2.8% m/m vs 0% expected (prior: 0.5% revised from -0.3%)

  • Sales were lower than expected, but prior month data were revised up.
  • Sales declined in all 4 districts except South. Low inventories and rising yields have driven the sales lower.


Eurozone: M3 (Jan.): 12.5% y/y as expected (prior: 12.4% revised from 12.3%)

  • Monetary aggregates remained on a rising trend; M1 was up by 16.4% y/y after 15.6% y/y the prior month.
  • Growth pace of credit to the private sector has slowed down from 4.7% y/y the prior month to 4.4% y/y, reflecting some probable tightening in the credit supply from banks.


Eurozone: Industrial confidence (Feb.): -3.3 vs -5 expected (prior: -6.1 revised from -5.9)

  • Business confidence has improved significantly from the prior month.
  • Sentiment has improved on future production and selling prices, but opinions were just less negative on orders, exports and employment.
  • Despite existing headwinds, sentiment in industry continues to improve.


Eurozone: Consumer confidence (Feb.): -14.8 as expected (prior: -15.5)

  • Sentiment on current situation has eroded further but opinions were less negative from the prior month on future economic situation and employment.
  • Consumer sentiment should probably not improve significantly before seeing easier restrictions and larger vaccination roll out.


Eurozone: Service confidence (Feb.): -17.2 vs -17.4 expected (prior: -17.7 revised from -17.8)

  • Sentiment was slightly less depressed from the prior month but remained at a low level.
  • Views were less negative on future economic situation and employment from the prior month.


France: Consumer confidence (Feb.): 91 vs 92 expected (prior: 92)

  • Sentiment has eroded from the prior month due to more depressed sentiment on current situation.
  • Sentiment was stable on future economic situation, but unemployment remained a concern.


Germany: GFK consumer confidence (Feb.): -12.9 vs -14 expected (prior: -15.5 revised from -15.6)

  • Consumer sentiment has rebounded more than expected from the prior month.
  • Expectations on future growth, income and willingness to buy have strongly regained from the prior month.
  • The index remained at a depressed level.


Italy: Consumer confidence (Feb.): 101.4 vs 101 expected (prior: 100.7)

  • While sentiment on personal situation has decreased further, total sentiment has regained from the prior month due to improving opinions on global and future economic situation.


Italy: Manufacturing confidence (Feb.): 99 vs 96 expected (prior: 95.6 revised from 95.1)

  • As seen at the eurozone level, sentiment in industry has rebounded from the prior month on improving future economic situation; views on production and orders were in parallel less negative.


Spain: PPI (Jan.): 3.4% m/m vs 1% expected (prior: 0.3%)

  • A strong rebound in prices over the month due to a surge in energy, electricity, food and chemical prices.
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