Eurpean Economies look strong:
Here are few articles . recent data points to declining
unemployment, strong holiday sales, and increased factory output.
personal and corporate tax cut in Italy, Germany and France
will help too.
European Economies: German Unemployment Declines
(Update1)
By Catherine Hickley and Andreas Cremer with reporting
by Brian Parkin
Berlin, Jan. 9 (Bloomberg) -- The number of people out
of work in Germany fell for a ninth
straight month in December as rising exports prompted
hiring in Europe's largest economy.
Unemployment declined by a greater-than-expected
27,000, after falling a revised 18,000 in
November, one fifth more than originally reported,
Federal Labor Office figures showed. The
jobless rate declined to 9.2 percent, the lowest level
since March 1995, from 9.3 percent, the
Bundesbank reported.
Although growth in the 12-nation euro zone is beginning
to slow, the economy is still likely to
expand by some 3 percent this year, about the same pace
of growth as the U.S, analysts said.
That's likely to lead to a further decline in
unemployment.
``We're definitely planning to add staff'' this year,
said Christine Krepold, a spokeswoman for
Bayerische Motoren Werke AG, Germany's No. 3 carmaker.
BMW said it will hire as many as
1,000 people, on top of last year's 2,500 recruits,
after soaring exports in 2000 boosted sales by
9 percent.
The nation's jobless rate, still twice as high as that
of the U.S., has steadily declined from a
post-war record of 11.8 percent in 1997. That's boosted
the popularity of Chancellor Gerhard
Schroeder, who faces regional elections in March, in
Baden-Wuerttemberg and
Rhineland-Palatinate.
``We expect a clear reduction in unemployment this
year,'' said Labor Minister Walter Riester.
The jobless total will probably fall by some 250,000,
following a drop of 210,600 in 2000, the
government predicted today.
ECB Rate Cut
The yield on interest rate futures contracts rose on
speculation the European Central Bank may
hold back from cutting interest rates for several more
weeks, even after concern about slower U.S.
economic growth prompted the Federal Reserve to reduce
rates last week. The yield on the
March three-month contract rose by 4 basis points to
4.53 percent.
German exports rose 27 percent in October from a year
earlier to a record 111.3 billion deutsche
marks ($53.9 billion), a separate report today from the
Federal Statistics office showed. In a
further sign that the nation's economic expansion is
likely to continue, the government yesterday
reported the first increase in industrial production in
three months in November.
``The driving force for the labor market was demand
from abroad for industrial goods,'' said
Bernhard Jagoda, president of the Federal Labor Office.
German exporters may not be able to expect as much help
from the euro as they got last year. In
the last four months, Europe's single currency has
risen by more than a tenth against the dollar,
after shedding almost 30 percent of its value in the
first 21 months of its existence. The
strengthening of the euro makes European goods more
expensive in export markets.
Tax Cuts
While export growth is likely to slow, many companies
will benefit this year from higher
spending in Germany, spurred by tax cuts, Labor
Minister Riester said. The government has cut
45 billion deutsche marks ($21.7 billion) in income and
corporation taxes this year, in an attempt
to spur the economy.
``We see German car sales rising this year and one
reason is the strength of the German
economy,'' Helmut Panke, a management board member of
BMW, said in an interview.
Schroeder's Social Democratic Party and the Green Party
are counting on a further decline in
unemployment to help win federal elections in 2002.
Failure to cut joblessness was one reason
Schroeder's predecessor, Helmut Kohl, lost the 1998
election.
Economists had predicted drop of 16,000 in the December
jobless total, which fell to 3.77 million
from 3.79 million. The jobless rate in Western Germany
fell to 7.3 percent from 7.4 percent.
Eastern Germany's unemployment rate also declined by a
tenth of a percentage point, to 17.3
percent.
Companies Hire
Anecdotal evidence shows that many industries are
hiring. Tecis Holding AG, a German financial
services company that provides investment services,
plans to hire 20 to 30 people at its
Hamburg-based headquarters, and about 300 salesmen.
ADVA AG Optical Networking, a
German cable network maker, plans to expand its
workforce by a third. Puma AG, Germany's
No. 2 sporting-goods maker, said it will create new
jobs at its regional branches.
Germany's economy is likely to expand 2.8 percent in
2001, down from 3.1 percent last year,
according to a European Commission forecast made in
November. The euro region's economy as a
whole is likely to grow 3.2 percent compared with 3.5
percent in 2000, the European Union's
executive agency.
The German economy created 36,000 jobs in October,
today's report showed, though no
employment figures were available for either November
of December
------------------------------------------------------------- U.K. Xmas sales strong
British consumers packed stockings with
PlayStation 2, mobile phones
January 9, 2001: 7:32 a.m. ET
LONDON (CNNfn) - British retailers rang up strong sales
in the run-up to Christmas, with high-tech
goods like mobile phones and Sony's PlayStation 2 filling
consumers' stockings.
Games retailer Electronics Boutique PLC (EBQ) said Sony's
new games console helped its to
increase comparable sales by 15 percent in the last five
weeks of 2000, while mobile-phone
operators added 5.7 million new users in the three months
ended Dec. 30, a quarterly record.
The British Retail Consortium said sales by U.K.
retailers were up 3.4 percent in December from a
year earlier, outpacing the 2.9 percent growth recorded
in December 1999, but cautioned against
interpreting the figures as a consumer boom. However,
mainland European retailers Metro AG in
Germany and France-based Carrefour SA also reported
strong sales.
"Christmas shopping only really got under way from about
Dec. 21, providing a test of nerve for
retailers," the BRC said. "A good start to the sales was
almost immediately disrupted by snow."
Britain's most famous toy store, Hamleys PLC, said on
Monday like-for-like sales rose 10 percent
in the five-week Christmas trading period, partly thanks
to an upsurge in shopping online.
Hamleys said lively Christmas trading meant like-for-like
sales were 4 percent higher in its fiscal
first half, with its main store in Regents Street in
Central London recording a 13 percent rise.
Transport hitches dent sales
But both Hamleys and Selfridges PLC (SLF), which sells
designer brands at its flagship store on
Oxford Street, London's premier shopping thoroughfare,
said a crisis in Britain's public transport
system meant the Christmas season had been weaker than
they hoped. The country's rail
network is undergoing a major overhaul, resulting in
disrupted services, after a spate of accidents
in recent years.
Selfridges said sales rose 1 percent in the six weeks to
Jan. 6, with the Oxford Street store
recording unchanged sales, while sales at its outlet at
Trafford Centre in Manchester, northwest
England, rose 22 percent in the same period.
"Our sales in Oxford Street have been affected by the
disruption to rail services, but the effect
has been offset by margin and cost improvements and the
performance of Manchester," Chief
Executive Vittorio Radice said in a statement.
British pub operator JD Wetherspoon (JDW) celebrated
strong trading over Christmas, but wine
retailer Majestic (MJW) suffered a millennium hangover.
Wetherspoon, which runs 466 pubs across the country, said
comparable sales in the five weeks
to Dec. 31 rose 10 percent.
Majestic's same-store sales fell 2.7 percent in the nine
weeks to Jan. 1. The company faced an
uphill task to match the level of demand triggered by
1999's millennium celebrations, an suffered a
predictable decrease in champagne sales.
Selfridges, Wetherspoon up
Shares in Selfridges rose 3.1 percent to 316 pence by
mid-session Tuesday, Wetherspoon
jumped 6.5 percent to 368.5 pence and Electronics
Boutique soared 11.5 percent to 68 pence in
midday trade in London, but Majestic dropped 9.5 percent
to 211.25 pence.
Dixons Group PLC (DXNS), Britain's biggest electronics
retailer, is due to issue a trading
statement Wednesday.
In continental Europe, French retailer Carrefour (PCA),
the world's second-largest retailer after
U.S. giant Wal-Mart Stores (WMT: Research, Estimates),
said Monday sales in December rose to
7.9 billion ($7.5 billion), up 18.6 percent on a
proforma basis from a year earlier. Company-wide
sales for 2000 came to 73.1 billion, an increase of 25
percent.
Germany's Metro (FMEO) said sales in 2000 rose 7.1
percent to 91.8 billion marks ($44.56 billion),
lifted by strong growth in its international business.
In Frankfurt, Metro shares were unchanged at 49.80, while
Carrefour dipped 4.8 percent to
61.90 after as series of analysts lowered their
recommendations on the stock. |
