Market insight

Germany: IFO (Feb.): 93.4 vs 92.1 expected (prior: 92.9)

• IFO business climate: 96.1 vs 95.3 expected, 96 the prior month.
• Sentiment on current situation declined (from 99.2 to 98.9), while expectations have slightly increased, being back to their Dec. level.
• By sector, sentiment eased for services, trade and construction from past month level, while opinions were marginally less negative in the manufacturing sector.
• PMI and IFO sent signals that confidence is not significantly impacted by latest events; but negative signals could come later, related to disruption in the supply chain and new developments of the COVID in Europe too.

Turkey: Industrial confidence (Feb.): 106.7 (prior: 106.4)

• Sentiment has rebounded on orders and capex, while views on global situation remained cautious.

US: Markit Manufacturing PMI (Feb. Prel.): 50.8 vs 51.5 expected (prior: 51.9)

• The manufacturing PMI just avoided a decline into contraction but fell to the lowest since August.

US: Markit Services PMI (Feb. Prel.): 49.4 vs 53.4 expected (prior: 53.4)

• Business confidence in the service sector slumped to the lowest level since October 2013 as companies have become more worried about the coronavirus and its impact notably on the travel and tourism sectors. The new business index dropped from 52.5 to 49.7, the lowest since October 2009.

US: Existing home sales (Jan.): 5.46M vs 5.44M expected (prior: 5.53M revised from 5.54M)

• Existing home sales edged lower (-1.3% m/m) but remain at solid levels, supported by a robust labor market and low mortgage rates.

Eurozone: PMI Manufacturing (Feb P): 49.1 vs 47.4 expected (prior: 47.9)

• Sentiment surprised on the upside in February led by Germany despite fears that the coronavirus-related disruptions to supply chains and demand in Asia will drive activity lower.
• Easing of tensions between US and China has probably been the main driver behind the positive surprise.
• However, the details of the survey suggest a weaker picture (new export orders fell sharply) and the impact of the virus might not have fully hit yet.

Eurozone: PMI Services (Feb P): 52.8 vs 52.3 expected (prior: 52.5)

• Service sentiment rose, mainly due the upside surprise in France (52.6 vs 51.3 expected). 
• However, the outlook remains highly uncertain, notably in respect to the potential disruptions to travel, tourism and demand arising from the coronavirus outbreak.

UK: PMI Manufacturing (Feb P): 51.9 vs 49.7 expected (prior: 50)

• Sentiment jumped in February and signal the strongest improvement in business conditions since April 2019.
• The expansion of manufacturing was supported by a sustained rebound in client spending since the start of 2020, with the latest survey pointing to the fastest rise in new work since March 2019.

UK: PMI Services (Feb P): 53.3 vs 53.4 expected (prior: 53.9)

• Service sentiment dropped slightly but remained well above 50.
• The slowdown partly reflected weaker demand from abroad, as signaled by a renewed fall in export orders in February. Companies reporting a fall in overseas sales often cited a marked reduction in new work from clients in Asia.

Eurozone: CPI (Jan F.): 1.4% m/m as expected (prior: 1.3%)

• Core inflation fell to 1.1% y/y, down from 1.3%.
• Supercore inflation, which excludes the prices of goods and services that show little response to the business cycle as well as package holidays, slowed to 1.38% from 1.46%

US: Philadelphia Fed. (Feb.): 36.7 vs 11 expected (prior: 17)

• Sentiment has strongly rebounded on new orders on both current situation and future situation. Shipments have also improved, while sentiment on employment has slightly eased as well as future capex.
• As seen in the New York Empire index, business sentiment has improved on firmer activity.

​US: Initial jobless claims (Feb.15): 210k as expected (prior: 206k revised from 205k)

• Continuing claims:1726 k after 1701k past week.

UK: Retail sales (Jan.): 1.2% m/m vs 0.5% expected (prior: 0.7%)

• A strong rebound in sales, helped by strong discount in clothes, except for auto fuel and household goods.

Switzerland: Trade balance (Jan.): 4.78 Bn CHF (prior: 1.97Bn)

• Surplus has rebounded as exports were up by 1.7% m/m (real terms) and imports were down by 1.8% m/m (real terms).

France: CPI (Jan.): -0.5% m/m as expected (prior: 0.4%)

• Final inflation has confirmed the monthly decrease, while yearly comparison has slightly increased (1.7% y/y after 1.6% y/y).
• The rise in monthly prices of energy and food were more than compensated by larger discounts in clothes prices.

Germany: GFK consumer confidence (March): 9.8 as expected (prior: 9.9)

• Confidence has marginally eased after past month rebound.

Germany: PPI (Jan.): 0.8% m/m vs 0.1% expected (prior: 0.1%)

• A monthly rise driven by higher commodity and oil prices (this could revert by Feb., after the fall in oil prices).
• PPIs were up by 0.2% y/y after -0.2% y/y the prior month.

Eurozone: Consumer confidence (Feb.): -6.6 vs -8.2 expected (prior: -8.1)

• Preliminary estimates have shown improving sentiment after sluggish trend; no details available.

Brazil: Consumer confidence (Feb.): 87.8 (prior: 90.4)

• Expectations have strongly decreased, while views on current situation have improved.

Brazil: CPI (Feb.): 0.22% m/m vs 0.23% expected (prior: 0.71%)

• The IPCA index has moderated over the month, due to falling monthly prices in clothes, health and food prices.
• The yearly comparison has eased from 4.34 % y/y the prior month to 4.21% y/y.

Russia: Retail sales (Jan.): 2.7% y/y vs 2.2% expected (prior: 1.9%)

• Firmer trend in food and ongoing rising trend in non-food sales.

Russia: Unemployment rate (Jan.): 4.7% as expected (prior: 4.6%)

• Unemployed has marginally increased over the month.

Russia: Real wages (Dec.): 6.9% y/y vs 3.6% expected (prior: 2.7%)

• Preliminary data have pointed to a sharp rebound in real wages.

Turkey: Consumer confidence (Feb.): 57.3 vs 58.8 expected (prior: )

• Confidence has eased on unemployment, personal financial situation and future economic situation.
• Trend in confidence has moderated since past Nov.

US: Housing starts (Jan.): 1567k vs 1428k expected (prior: 1626k revised from 1608k)

• Building permits: 1551 k after 1420 k past month.
• Housing starts have decreased less than expected; single family houses remained above 1000 k and multi-family houses have slightly increased over the month. Building permits have increased for both categories, after past month correction.
• With low interest rates in place, trend should remain positive.

US: PPI (Jan.): 0.5% m/m vs 0.1% expected (prior: 0.2% revised from 0.1%)

• Core PPIs were up by 0.4% m/m, due to services (trade), up by 0.7% m/m. Energy prices were down by 0.7% m/m.
• PPIs have accelerated from 1.3% y/y to 2.1% y/y and core PPIs stayed on a stable trend (1.5% y/y).

UK: CPI (Jan.): -0.3% m/m vs -0.4% expected (prior: 0%)

• The largest decreases were seen in clothes, housing and in transport costs. Core prices were down by 0.6% m/m.
• Yearly changes have accelerated from 1.3% to 1.8% y/y on headline prices and from 1.4% to 1.6% y/y for core prices.

UK: PPI Input prices (Jan.): 0.9% m/m vs -0.4% expected (prior: 0.9% revised from 0.1%)

• Core input prices have also accelerated from 0.1% m/m to 1.1% m/m.
• Input prices were back into positive after being negative in Q3-19: up by 2.1% y/y after 0.9% y/y the prior month.

UK: PPI Output prices (Jan.): 0.3% m/m vs 0.1% expected (prior: 0%)

• Specific sectors have contributed to the monthly rise: food, coke, basic metals and electrical equipment.
• Yearly trend has also accelerated, from 0.9% y/y to 1.1% y/y.

Sweden: CPI (Jan.): -1.4% m/m vs -1.1% expected (prior: 0.4%)

• A large fall of prices across sectors, driven particularly by clothes and food and household goods.
• Yearly trend has moderated from 1.8% y/y the prior month to 1.3% y/y; core inflation was down by 1.4% m/m, and they moderated from 1.7% y/y to 1.6% y/y.

Turkey: Central bank cut rates from 11.25% to 10.75%.

• Forward guidance still favors an easing bias, but statement has pointed towards underlying risks related to credit and balance sheets situation.