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Tag Archives: Economics

Industrial Output – The Winners and Losers

Summary Industrial Production (IP) rose for its fourth consecutive month after March and April’s sharp contraction (Chart 1) IP remains 7.6 percent below its December 2019 level (Chart 1) Durable Manufacturing output was up 0.7 percent in August, led by Computers and Aerospace products (Chart 2) Computer & Electronic Products (CEP) continue to significantly outperform all other sectors in industrial manufacturing with production up 5.5 percent y/y and 2.3 percent even during the...

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22/9/20: COVID19 Update: German Economic Growth Forecasts 2020-2022

Germany's ifo Institute published their forecasts for 2020-2022 today. These represent an improvement on Summer forecasts, but continue to show big impact of the COVID19 pandemic lasting beyond 2021:Private consumption is expected to be 0.82 percentage points below 2019 at the end of 2022, and barely in line (0.78 percentage points above) with 2018 levels. GDP is forecast to reach 1.34 percentage points above 2019 levels in 2022. Employment levels are projected to stay below 2019 levels...

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17/9/20: Exploding errors: COVID19 and VUCA world of economic growth forecasts

Just as I covered the latest changes in Eurozone growth indicators (https://trueeconomics.blogspot.com/2020/09/17920-eurocoin-leading-growth-indicator.html), it is worth noting the absolutely massive explosion in forecast errors triggered by the VUCA environment around COVID19 pandemic.My past and current students know that I am a big fan of looking at risk analysis frameworks from the point of view of their incompleteness, as they exclude environments of deeper uncertainty, complexity and...

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17/9/20: Eurocoin Leading Growth Indicator 3Q 2020

Eurocoin, CEPR & Banca d'Italia leading growth indicator for Euro Area economy is pointing to renewed weaknesses in the Eurozone economy in August, falling to its lowest levels in the COVID19 pandemic period:As the chart above shows, Eurocoin fell from -0.5 in July to -0.64 in August, its lowest reading since June 2009. The forecast September indicator is at -0.30. Through August, we now have five consecutive months of sub-zero readings. Based on July-August data and September forecast,...

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Q3 GDP Growth Set For 30% But No V-Shaped Recovery

The Atlanta Fed’s GDPNow estimate for Q3 GDP growth is currently running at 30.8 percent on an annualized basis (6.9 percent quarter-on-quarter), which will shatter by a wide margin the prior highest print on record of 16.7 percent registered in Q1 1950. Source: Custer Consulting Group No V-Shaped Recovery Even with such robust Q3 growth, the economy will only have recovered around 60 percent of its Q1 & Q2 losses, and real output will still be 4 percent below its...

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9/8/20: Ireland PMIs and Economic Activity Dynamics for August

Ireland's PMIs are signalling a cautious recovery in the growth dynamics across three sectors, with growth still underperforming historical averages.Irish Services Sector PMI rose to a respectable 52.4 in August from 51.9 in July, with the latest index reading sitting 38.5 points above April 2020 COVID-19 pandemic lows. However, statistically, the index remains below historical average of 55.0 and the median of 56.8. In other words, second month post-contraction phase of the pandemic, Irish...

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8/92020: BRIC: Composite economic activity indicators

 Based on Markit's Composite PMIs, here are the BRIC economies composite economic activity indicators for 3Q 2020 to-date (July-August). Please, note: Manufacturing PMIs for BRIC economies were covered here: https://trueeconomics.blogspot.com/2020/09/8920-bric-manufacturing-pmis.html, and Services PMIs were covered here: https://trueeconomics.blogspot.com/2020/09/8920-bric-services-pmis.html. Brazil Composite PMI for 3Q 2020 currently sits at 50.6, barely above the zero-growth line of 50.0...

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8/9/20: BRIC: Services PMIs

Services sector activity as reflected by PMIs from the BRIC economies is now available for August, so here are the top numbers: In terms of actual readings, and do recall, quarterly PMIs referenced above are averages over three months period, so 3Q 2020 data is only covering July-August 2020.Brazil Services PMI was nowhere near the insane reading posted by the country Manufacturing PMI (see post here: https://trueeconomics.blogspot.com/2020/09/8920-bric-manufacturing-pmis.html). Services...

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Shedlock: Huge Discrepancies Cast Doubt On Jobs Report

Jobs expanded by 1.4 million and the unemployment rate fell to a much better than expected 8.4%. The BLS Employment Report for July shows employment rose by 1.4 million in August following a gain of 1.8 million in July, 4.8 million in June, and 2.7 million in May.  BLS Jobs Statistics at a Glance Nonfarm Payroll: +1,371,000 to 140,914,000 – Establishment SurveyEmployment: +3,756,000 to 147,228,000 – Household SurveyUnemployment: -2,788,000 to 13,550,000 – Household SurveyBaseline...

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