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Daily Macroeconomic Digest

Tuesday 14 August
Sustained Q2 GDP growth in Germany; US small firms’ sentiment at record high

US: NFIB Small Business optimism (July): 107.9 vs 106.8 expected (prior: 107.2)

  • Sentiment on future economy, capex and hiring has increased from the prior month.
  • The index is back to its previous highest levels.


Germany: GDP (Q2-18): 0.5% q/q vs 0.4% expected (prior: 0.4% revised from 0.3%)

  • GDP growth was more resilient than expected, thanks to dynamic domestic demand, while net exports were negative according to first estimate. Past quarter data were also revised up from initial estimates. More details on GDP data will be published later on.
  • Growth trend has slowed on a yearly basis, from 2.8% y/y in Q4-17 to 2% y/y in Q2.


Switzerland: PPI-import prices (July): 0.1% m/m (prior: 0.2%)

  • Import prices were up by 6.9% y/y; producer prices were up by 2.1% y/y. These prices have been mainly driven by higher energy, raw material and machinery prices.


France: Unemployment rate (Q2-18): 8.7% vs 8.9% expected (prior: 8.9%)

  • Unemployed has decreased by 48 k over the quarter.


UK: Unemployment rate (ILO) (July): 4% vs 4.2% expected (prior: 4.2%)

  • Claimant count stayed stable at 2.5%.
  • Jobless claims have increased by 6.2 k after 9 k the prior month.
  • With fewer arrivals of foreign workers, employment of UK nationals has increased.


UK: Average earnings incl. Bonus (June): 2.4% y/y vs 2.5% expected (prior: 2.5%)

  • Including bonuses, wages were up by 2.7% y/y after 2.8% y/y the prior month.
  • Trend in wage growth has accelerated in construction and leisure sectors, but remained contained in other sectors.
  • Lower slack in labor could put wages on rising pressures in several sectors.


Eurozone: Industrial production (June): -0.7% m/m vs -0.4% expected (prior: 1.4% revised from 1.3%)

  • After the rebound in May, activity has eased back in June except in energy.
  • Activity could remain fragile if concerns on trade war develop further.


Eurozone: GDP (Q2-18): 0.4% q/q vs 0.3% expected (prior: 0.4%)

  • Growth estimate for Q2 has been revised up, from 0.3%q to 0.4%q.
  • Germany and Eastern countries have been the driving force in Q2, in terms of GDP growth.
  • Q3 GDP growth should be at least up by 0.4%q/q.


Germany: Zew (Aug.): 72.6 vs 72.1 expected (prior: 72.4)

  • Sentiment among financial community has increased and expectations were less depressed.


Poland: GDP (Q2-18): 0.9% q/q vs 1% expected (prior: 1.6%)

  • Growth stayed on a stable yearly trend (5% y/y).
Friday 10 August
Moderate US inflation; UK GDP has rebounded in Q2

US: CPI (July): 0.2% m/m as expected (prior: 0.1%)

  • Inflation remained moderate; prices of energy, apparels and computers were down over the month, while rents and services were up by 0.3% m/m; core inflation was up by 0.2% m/m as expected.
  • Headline inflation stayed on a stable trend at 2.9% y/y, while core inflation has slightly accelerated at 2.4% y/y after 2.3% y/y the prior month.
  • Headline inflation is expected to moderate at year-end, but the Fed should continue to hike in H2-18.


France: Industrial production (June): 0.6% m/m vs 0.5% expected (prior: -0.2%)

  • Activity has rebounded in all sectors, and particularly activity in refinery, reversing the decrease seen past months.
  • Construction and production of autos have both rebounded, which should be a positive signal for consumption and growth on Q3.


UK: Industrial production (June): 0.4% m/m vs 0.3% expected (prior: -0.2% revised from -0.4%)

  • The rebound was mainly led by consumer goods production, while production in investment good was flat; production was down for intermediate, energy and oil sectors.


UK: GDP (Q2-18): 0.4% q/q as expected (prior: 0.2%)

  • Investment has driven the rebound, with firmer consumption. Exports have sharply fallen, still contributing negatively to GDP.
  • In terms of sectors, the main positive contribution came from services, transport, leisure and water distribution.
  • On a yearly basis, GDP has stabilized at 1.3% y/y, but domestic growth has slowed down further from 2.3% y/y in Q4-17.
  • The growth outlook depends from next UK-EU negotiations on Brexit.


Russia: GDP (Q2-18): 1.8% y/y vs 1.9% expected (prior: 1.3%)

  • Growth trend has slightly improved by Q2, but remained moderate as sanctions remained a drag on activity.
Thursday 09 August
US: flat monthly PPIs due to lower food and energy prices

US: Initial jobless claims (Aug. 4): 213k vs 220k expected (prior: 219k revised from 218k)

  • Continuing claims: 1755 k after 1726 k the prior week.


US: PPI (July): 0% m/m vs 0.2% expected (prior: 0.3%)

  • Prices stayed moderate due to lower prices in food and energy. Few rises are related to the increase of tariffs in steel.
  • Core prices (ex food, energy and trade) were up by a firmer 0.3% m/m; prices of capital equipment, transport and travel services have strongly rebounded over the month. This could push higher inflation at the core PCE/CPI level later on.
  • PPIs stayed on a quite stable yearly trend: 3.3% y/y after 3.4% y/y the prior month.


US: Wholesale inventories (June): 0.1% m/m vs 0% expected (prior: 0%)

  • Inventories have decreased on autos but have risen further for machinery; sales were negative (-0.1% m/m after 2.1% m/m), but were positive for autos and sustained for machinery.
  • The inventory-to-sales ratio stayed stable at a low level.


UK: RICS house price balance (July): 4% as expected (prior: 3% revised from 2%)

  • Sentiment on housing has slightly increased, but views on prices and future sales have weakened.


Switzerland: Unemployment rate (sa) (July): 2.6% as expected (prior: 2.6%)

  • Unemployed has decreased further, but its pace has moderated compared to the prior quarter.
Wednesday 08 August
Stable business confidence in France; weakening industrial activity in Spain

France: Business sentiment (Bank of France) (July): 101 as expected (prior: 101)

  • Sentiment has eased on production and orders, but it has globally stabilized.


Spain: Industrial production (June): -0.6% m/m vs -0.2% expected (prior: 0.8% revised from 0.9%)

  • A large fall in production in energy and in durable consumer goods.
  • Trend in industry has slowed down, and is now at the bottom of the growth range (0-5%y/y) in place since 2014.


Brazil: CPI (IBGE) (July): 0.33% m/m vs 0.26% expected (prior: 1.26%)

  • Housing prices remained on a strong growth, but prices of food and clothes have decreased over the month.
  • Inflation is still on a rising trend: 4.48% y/y after 4.39% y/y in June.
Tuesday 07 August
Sustained job openings in the US; Germany: industrial activity at risk

US JOLTS survey (June): 6662 k vs 6625 k expected (6659 k prior month, revised from 6638 k)

  • Hiring and job opening remained on a sustained trend after upwards revisions, while quitters stayed at a high level but have moderated from the prior month.
  • On average, labor remains on a healthy trend, with rising turnover.

Germany: Industrial production (June): -0.9% m/m vs -0.5% m/m expected (prior: 2.4%m/m)

  • Except energy, production has fallen in all sectors including construction.
  • This came after a strong rebound in May; as orders have fallen on trade concerns, there is a clear risk to see further disappointing numbers for July-August industrial activity.

Germany: Current account balance (June): EUR 26.2 bn vs EUR 21 bn expected (prior: EUR 12.6 bn)

  • Exports were flat over the month, while imports were up by 1.2% m/m.
  • Trade and current account surplus has increased further despite flat export performances.

UK: BRC sales (like-for-like) (July): 0.5% y/y vs 1.5% expected (prior: 1.1%)

  • The rebound has been driven by food sales, but total figures remained below expectations.

Sweden: Industrial production (June): 1.2% m/m (prior: 2.9%)

  • Trend in production has increased from 4.7% y/y to 5.7% y/y.

Norway: Industrial production (June): 4.7% m/m (prior: -1.0%)

  • Manufacturing production was flat (versus 0.3% m/m expected) and after -0.6% m/m in the prior month.
  • Extraction industry, oil-related industry and capital good production have rebounded over the month, while other sectors were flat or negative.
  • Total production was up by 2.4% y/y but manufacturing production stayed on a more moderate trend (0.6% y/y).
Macro economic

The Chief Economist's weekly update

To help you navigate through the economic news, here is a summary of last week’s main events and what to look out for next week.
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