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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (21224)	1/13/2005 12:57:02 AM
From: RealMuLan	Read Replies (1) \| Respond to of 116555

Do you buy this? Jay<g>--"China's small businesses 'most competitive'" 2005/1/12 By Wee Sui Lee SINGAPORE, AP China's small companies were voted the most competitive in Asia by regional business owners, outranking those from Hong Kong and Japan, according to a business survey released Tuesday. Chinese small businesses, defined as having less than 250 employees and turnover of under US$40 million (euro30 million) per year, were ranked first by 73 percent of respondents in the UPS Asia Business Monitor survey. Firms from Hong Kong, Japan, South Korea and Taiwan were also considered relatively competitive, while Philippine and Indonesian small businesses ranked the least competitive. The study, commissioned by the parcel delivery company and prepared by research agency Taylor Nelson Sofres, surveyed 1,200 business owners and managers in 12 Asian economies between Aug. 16 and Sept. 28. It wasn't immediately clear why the results weren't released sooner. Business leaders in China were less enthusiastic about their own standing, ranking small companies in Hong Kong, Japan, Korea and Taiwan above their own. Commenting on the results, Patrick Turner, director of the International Center of Entrepreneurship, INSEAD, said that it will be difficult for regional businesses to compete with China on a "pure price level." "But you can rely on other areas like customer service and dependability, for example, improving the quality of your product," Turner said. Responses were mixed about China's emergence as a manufacturing center for the world. Some 43 percent of business leaders saw that as a positive development, while 27 percent saw a negative impact, 17 percent saw both positive and negative aspects, and 12 percent saw neither. The availability of qualified staff was rated the most important factor for business competitiveness by survey respondents. Lack of innovation and access to funding and working capital were considered the biggest obstacles. chinapost.com.tw

To: TobagoJack who wrote (21224)	1/13/2005 1:21:23 AM
From: mishedlo	Read Replies (1) \| Respond to of 116555

BNZ WEEKLY OVERVIEW [interesting report from NZ - evidence of housing and auto slowdown there as well. With a slowdown in the UK, OZ, and strong evidence of a slowdown in the US, it appears to me that housing globally has peaked. China is perhaps a wildcard. Interesting that the BNZ is forecasting a fall in the NZ$. Quite substantial, but part of that is on the belief that the US will keep tightening. Mish] Over the past month we have seen the release of data in New Zealand which essentially shows a strong economy but with a growing list of things slowing down. Over 2005 we expect the signs of slowing activity to intensify – though not necessarily to a strong degree. The main sources of downward pressure on the economy’s rate of growth will be • Falling net immigration • Above average interest rates with plenty of scope for fixed rates to rise 1% and floating rates possibly rising a wee bit more but more importantly probably not falling until right near the end of the year – a lot depends on what the exchange rate does. • A high exchange rate which although over-valued and producing a current account deficit blow-out could easily be near current levels come the end of the year- though by then we will be very close to a potentially large fall. • Further easing in the housing cycle with unusual strength last year probably due to the fierce fixed interest rates war. • Slower growth in our top 14 trading partners nearer 3.2% than this year’s 4.4%. • Some easing in commodity prices. • Capacity constraints – especially in the labour market. But operators should be on the look-out for business customers who may be adversely caught out by just a slight slowing in revenue growth. A lot of people have set up their businesses in the past six favourable years and do not know what a slowdown looks like – even the small one we are anticipating. Tourist Numbers Falling With regard to the tourist data contained in the monthly migration release we learned the following about November. In the month the seasonally adjusted number of foreign visitors was down by 2.2% from October. This followed a 0.5% fall the previous month and means that in the three months to November visitor numbers were down by 1% seasonally adjusted from the three months to August. This is a turnaround from quarterly growth of 2.4% three months earlier and means that in the November quarter visitor numbers were up just 4.2% from a year earlier. Current Account Deficit Blows Out The current account was in deficit for the September quarter came in at a much larger than expected $4.2b compared with $1.8b in the June quarter and $2.8b a year ago. The result took the annual deficit to $8.2b or 5.8% of gross domestic product from 4.8% in the year to June, 4.3% a year ago, and an average of 4.8% over the past ten years and 4.9% over the past 30 years. The deficit is therefore now above average though has in the past got a lot worse. It was last at 5.8% of GDP in mid-2000 and hit 6.7% earlier that year and 6.9% in 2000. A large deficit implies an over-valued currency but experience shows a country can run a large deficit for many years before one’s currency depreciates – so it would be unwise to use the deterioration in the current account as a tool for forecasting what the NZD will do in the coming 12 months. All it tells us is that our reliance on foreign funding is growing and if anything comes along to disturb the willingness of foreigners to finance Nzers’ over-spending then the currency will likely fall quite sharply. New Zealand’s economy as measured by gross domestic product grew by a slightly less than expected 0.6% during the September quarter after growing 0.8% in the June quarter. Growth in the year to September – the country’s official growth rate – was 4.6% from 4.4% the previous quarter, 3.7% a year earlier, and average growth over the past five years of 3.7%. In the quarter consumer spending rose by a strong 1.6% and was up a whopping 6.1% for the year – a very unsustainable rate of growth which retailers should take note of. Residential construction fell 7% in the quarter and was up 8.9% for the year – a correction perhaps starting. Investment in plant, machinery & equipment was up just 0.4% in the quarter but rose 22% for the year and further strong growth is likely as businesses take advantage of the high exchange rate and boost capital spending in place of labour which is increasingly not available. Exports fell 5.7% in the quarter and this is why the 0.6% overall quarterly result was on the weak side. The decline mainly reflects dairy export timing we believe and this factor bouncing back in the December quarter should add 0.3% to the Dec. quarter growth which we currently estimate at 0.9%. Exports were up 4.6% for the year while imports were up 15.2% and down 0.1% for the quarter. Consumer Spending Weakens Late In 2004 We released our monthly BNZ.MarketView Consumer Spending series which showed that on average over the past four years spending in December using BNZ debit and credit cards (adjusted for user number changes) has risen 27.5%. In 2004 the December gain was just 26.1% which suggests a weaker than normal month which Statistics NZ may eventually report as a seasonally adjusted decline of up to 1%. December Quarter Weak For All Vehicle Registrations In December there were 18,321 cars registered around New Zealand. This represented a 4% fall from a year ago and small 0.6% rise for the 2004 calendar year. In the December quarter registrations were down 3.3% from a year earlier and in seasonally adjusted terms were down about 1% from the September quarter. The data show that after a wee surge in registrations in November things have reverted to their underlying downward trend with consumers easing back on car purchases (along with businesses making fleet purchases of course). Housing Construction Decline Continues In November the seasonally adjusted number of dwelling consents issued fell by 5.7% from October and in unadjusted terms was down by 11.8% from a year earlier. There is a clear downward trend in construction with consent numbers falling 14% seasonally adjusted in the November quarter from the August quarter. Stripping out apartments this quarterly decline changes to 10%. The data show activity remains at a very high level with 31,218 consents issued in the year to November – up 4.6% from the previous year and 29% above the ten year average. But things are turning around reasonably quickly. there are underlying pressures building up against the NZD. These include growth slowing this year to near 2.5% versus world growth coming in just over 3%. Our current account deficit worsening to perhaps 7% of gross domestic product from 5.8% currently. Monetary policy might not be tightened again whereas US rates are expected to rise around 1.5%. Our export commodity prices are showing growing signs of easing back from unusually high cyclical peaks and this will help further constrain export incomes. This process will be assisted by long-running cover running off for NZ exporters. Come the end of next year we feel the NZD will be back near its long run average against the USD of about 58 cents. But in the interim we suspect there will be some high currency volatility derived not just from the building pressures for the NZD to fall later this year but the risk of coordinated global policy announcements regarding the greenback, euro, yen and the undervalued Asian currencies.

To: TobagoJack who wrote (21224)	1/13/2005 1:53:13 AM
From: mishedlo	Respond to of 116555

Led By Oil, Trade Deficit Soars In November The trade deficit widened to $60.3 billion in November, the largest monthly reading on record. Exports of goods and services dropped 2.3% in November, after a 0.3% increase in the prior month. Inflation adjusted exports of goods declined 4.0% during November, following a 0.8% drop in the previous month. Imports of goods and services climbed 1.3% in November after a 3.6% increase in the previous month. The 18.1% surge in petroleum imports, after adjusting for inflation, led to the widening of the trade gap. Inflation adjusted imports of non-petroleum goods dropped 1.3% in November. The October-November trade data point to a widening of the trade deficit in the fourth quarter compared with the third quarter, implying that net exports are most likely to be a drag on real GDP growth. Mortgage Purchase Index Declines The mortgage purchase index fell to 393.1 during the week ended January 7 vs. 417.3 in the prior week. This is first reading below 400 since the week ended December 26, 2004. There is a good chance than bad weather played a role in bringing about this decline. The mortgage refinance index edged up to 1720.3 from 1701.3 during the same period. The four-week moving average of the purchase index is the lowest since the week ended March 19, indicating that the housing market momentum is probably losing steam. northerntrust.com

To: TobagoJack who wrote (21224)	1/13/2005 1:58:08 AM
From: mishedlo	Respond to of 116555

Japan Nov current account surplus falls 19.3 pct yr-on-yr; 1st drop in 17 mths Thursday, January 13, 2005 12:17:21 AM afxpress.com TOKYO (AFX) - Japan's current account surplus in November fell 19.3 pct from a year earlier to 1.20 trln yen, the first decline in 17 months, the Ministry of Finance said The result matched expectations. The market expected a surplus of 1.20 trln yen, according to the average of forecasts received from 17 research houses in a Nihon Keizai Shimbun survey. The forecasts ranged from 1.07 trln to 1.38 trln yen The decline was due to imports expanding at more than twice the rate of exports, and a massive outflow of investment funds against a significant inflow in November last year The trade surplus plunged 35.2 pct to 753.2 bln yen, as exports rose 13.4 pct to 4.92 trln yen while imports increased 31.2 pct to 4.16 trln yen The surplus in the goods and services account plummeted 48.2 pct from a year earlier to 456.8 bln yen The capital and financial account, which measures international fund flows, registered an outflow from Japan of 1.41 trln yen, against an inflow of 692.6 bln yen a year earlier In October, the current account surplus increased 7.4 pct from a year earlier to 1.34 trln yen. The trade surplus that month increased 10.1 pct to 1.39 trln yen, as exports rose 11.9 pct to 5.22 trln yen while imports expanded 12.5 pct to 3.83 trln yen The capital and financial account that month registered an outflow of 655.0 bln yen against an inflow of 925.9 bln yen a year earlier.

To: TobagoJack who wrote (21224)	1/13/2005 2:04:07 AM
From: mishedlo	Respond to of 116555

Japanese economy in a recovery trend, says BoJ´s Fukui Thursday, January 13, 2005 1:50:31 AM afxpress.com Japanese economy in a recovery trend, says BoJ's Fukui TOKYO (AFX) - Bank of Japan governor Toshihiko Fukui said the Japanese economy is in a recovery trend despite some weakness seen in production. "Some weakness is observed in production activities...On the other hand, corporate investment is increasing, and consumer spending keeps its steady undertone being backed by the improvement in employment conditions," Fukui said at a meeting with branch managers in Tokyo "Looking ahead, the economy is likely to keep the recovery trend, although there will remain a negative effect of inventory adjustment in the IT-related sectors in the near-term," Fukui said, citing expanding economies abroad and the resolution of excess investment and debts in the corporate sector. But he warned that it is necessary to carefully track the movement of demand for information technology-related industries and the movement of crude oil prices, both of which may affect the global economy Fukui reiterated the central bank will not abandon its super-loose credit policy until the year-on-year change in the monthly core consumer price index, which strips out volatile food prices, remains at or above zero for a prolonged period

To: TobagoJack who wrote (21224)	1/13/2005 9:29:41 AM
From: mishedlo	Read Replies (1) \| Respond to of 116555

UK business leaders back BoE rate decision Thursday, January 13, 2005 12:27:11 PM afxpress.com LONDON (AFX) - Business leaders lauded the Bank of England's decision to keep interest rates on hold at 4.75 pct in light of the recent slowdown in the UK economy. David Frost, director general of the British Chambers of Commerce, expects the rate-setting Monetary Policy Committee to persevere with a flexible stance and be ready to cut rates if circumstances worsen "Dismal reports from the retail trade about Christmas sales are worrying, if they indicate a more general weakening in consumer spending," he said. "It is widely accepted that, if house prices start falling more sharply, the risks facing the economy will worsen considerably," he added Meanwhile, the Confederation of British Industry's chief economist Ian McCafferty said the MPC did the right thing given that it has to juggle emerging inflationary pressures, driven by a tight labour market and buoyant commodity prices, against the risk of an over-abrupt slowdown in consumer activity. "Interest rates are likely to remain on hold for sometime," he said

To: TobagoJack who wrote (21224)	1/13/2005 9:46:56 AM
From: mishedlo	Respond to of 116555

UK manufacturing slides to recession as Nov rebound fails to materialise UPDATE Thursday, January 13, 2005 11:49:32 AM afxpress.com LONDON (AFX ) - The beleaguered manufacturing sector is sliding towards recession once again as the expected rebound in output failed to materialise in November, official figures showed today The office of National Statistics revealed that manufacturing output unexpectedly fell 0.1 pct in November from the previous month, the same as in October. The consensus of analysts' forecasts was for a 0.3 pct improvement That means that manufacturing output, which accounts for just over 17 pct of the UK's overall GDP, has fallen for five of the last five months, suggesting the sector is likely to prove a drag on the economy in the fourth quarter The statistics office said there was a significant 1.9 pct decrease in output in chemicals and man-made fibres, offset partly by a 1.3 pct improvement in the transport equipment industries In the three months to end-November, manufacturing output was down 0.5 pct from the previous three months, meaning that the sector has declined over the last two three-month-on-three-month periods. Technically, a sector is in recession if it records two consecutive quarterly output declines. If December disappoints, and keeps the fourth quarter in contraction mode, then the sector will officially be in recession. In the third quarter, manufacturing output fell 0.8 pct Paul Dales, UK economist at Capital Economics, said the manufacturing sector will almost certainly drop into a technical recession in the fourth quarter for the first time since the second quarter of 2002 On a year-on-year basis, manufacturing output was unchanged, better than October's 0.5 pct decline, but way short of expectations of a 0.3 pct increase Meanwhile, the wider measure of industrial production, which also includes utilities output, increased by only 0.2 pct in November from the previous month, better than October's 0.2 pct decline but way short of analysts' expectations of a 0.4 pct increase. Industrial production accounts for around 22 pct of the UK's GDP The statistics office said industrial production in the month was boosted by a 1.1 pct increase in the output of electricity, gas and water supply Nevertheless, the year-on-year decline failed to improve as expected, with production down 0.9 pct, better than October's 2.0 pct fall but worse than expectations of a more moderate 0.6 pct decline Here again, industrial production in the three months to end-November was 1.9 pct down Since the rise was driven entirely by higher energy output, analysts said the data was not indicative of any underlying improvement "Despite the modest increase in November, industrial output is on course to act as a drag on GDP," said Ross Walker, economist at Royal Bank of Scotland "Today's data suggest industry will reduce Q4 GDP growth by around 0.1 percentage point, raising the hurdle for economic growth to return to trend in Q4," he added There's no improvement in sight, according to the statistics office itself, which estimates the trend rate of growth for manufacturing at -1 pct, unchanged on October's estimate, and the trend estimate for industrial production at -2.5 pct, even lower than than October's -2 pct Capital Economics' Dales said any recovery this year from possible rate cuts and a lower sterling trade-weighted exchange rate is likely to be subdued "With global activity also likely to weaken, any recovery is unlikely to be strong enough to compensate fully for weaker household spending as the housing market slowdown continues," he added Today's data has cemented expectations that there won't be any more interest rate hikes soon, despite scepticism about the official manufacturing figures on the Bank of England's rate-setting Monetary Policy Committee. "The Bank should thus be comfortable sitting on its hands for the moment, we believe, at least until we receive further evidence to confirm one way or another how the economy is shaping up in 2005," said George Buckley, economist at Deutsche Bank The MPC, which is expected to keep interest rates unchanged at midday, has raised the cost of borrowing a quarter point on five occasions since November 2003, taking its key repo rate up to 4.75 pct, as it sought to stem inflationary pressures arising from above-trend growth and rampant consumer demand

To: TobagoJack who wrote (21224)	1/13/2005 9:56:54 AM
From: mishedlo	Respond to of 116555

ECB Press Conference [from dow jones news wire - via email - no link - I will look for text of conference] With the U.S. data, and the ECB press conference giving little immediate direction for the dollar, it bumped around in relatively tight ranges. For most of the New York morning, the euro has been trading between $1.13210 and $1.3250, and the dollar has traded between Y102.35 and Y102.70. Still, Trichet's press conference is seen as an attempt to keep the dollar moving higher, loosely dovetailing with recent U.S. Treasury Department reiterations of a "strong dollar policy" and promises to tackle deficits. It also jibes with recent comments from Japan officials saying they are "closely monitoring" exchange rates, largely seen as a threat of ntervention should the yen rally go too far. Answering reporters' questions on Thursday, an ECB official also said that U.S. Treasury Secretary John Snow's strong dollar comments are important. That adds to Trichet's recent statement that he "appreciates" what Snow said last Friday when he detailed budget deficit reduction efforts. Trichet's comments were largely seen as more dovish on inflation, making near-term interest rate hikes less of a possibility, than he had been at the ECB's December meeting. "(Trichet) is probably sounding a little bit more dovish than the market was expecting," said Ian Stannard, senior foreign exchange analyst at BNP Paribas in London. Stannard said the reduced inflation fears bring into line the ECB's attempts to talk down the euro and its views on inflation and that may give more credibility to its jawboning efforts. Until now, he explained, while the ECB has worried about the euro's rise, it has also expressed concern about inflation. Yet if the euro was lower, high oil and other import prices would have created greater inflationary pressures. With the ECB now saying inflation was less of a problem, the case for a weaker euro has become more convincing, he said. "We now have a situation where their comments with regards to inflation pressures and the exchange rate are increasingly consistent. That will help in terms of the credibility of the ECB's message," he said.

To: TobagoJack who wrote (21224)	1/13/2005 10:02:19 AM
From: mishedlo	Respond to of 116555

BoE should consider cutting rates if manufacturing continues to struggle - TUC Thursday, January 13, 2005 12:32:44 PM afxpress.com LONDON (AFX) - The Bank of England was right to keep its key repo rate unchanged at 4.75 pct but should consider cutting borrowing costs if the manufacturing sector continues to struggle, the Trades Union Congress said. In the past 12 months, 112,000 jobs have been lost in manufacturing, noted Ian Brinkley, chief economist at the TUC "If 2005 is to be a better year for the sector, the next interest rate shift must be downwards," he said. Official figures earlier showed the beleaguered manufacturing sector sliding towards recession once again as the expected rebound in output failed to materialise in November. The office of National Statistics revealed that manufacturing output unexpectedly fell 0.1 pct in November from the previous month, the same as in October. The consensus of analysts' forecasts was for a 0.3 pct improvement That means manufacturing output, which accounts for just over 17 pct of the UK's overall GDP, has fallen for five of the last five months, suggesting the sector is likely to prove a drag on the economy in the fourth quarter

To: TobagoJack who wrote (21224)	1/13/2005 10:09:05 AM
From: mishedlo	Read Replies (1) \| Respond to of 116555

UK Dec shop prices at record low, down 1.41 pct yr-on-yr - BRC Thursday, January 13, 2005 11:31:53 AM afxpress.com LONDON (AFX) - High street inflation reached a record low in December as retailers discounted products heavily in an attempt to boost trade, a leading retail lobby group said. The British Retail Consortium said its shop price index fell in the year to December to -1.41 pct from -0.94 pct in November and below October's record low of -1.37 pct Kevin Hawkins, director general at the BRC said a "tough trading environment has sent the annual high street inflation rate to a record low". Both food and non-food prices fell in December, the BRC said. Prices of many non-food items, especially clothing and footwear, were cut sharply in pre-Christmas sales. "There were also numerous price promotions, especially on big-ticket items where demand has been hit by consumer caution in the face of interest rate rises and the slowing housing market," the lobby group added

To: TobagoJack who wrote (21224)	1/13/2005 10:14:55 AM
From: mishedlo	Respond to of 116555

German 2004 GDP up 1.7 pct; deficit breaches stability pact again at 3.9 pct Thursday, January 13, 2005 8:29:31 AM afxpress.com WIESBADEN (AFX) - Germany's gross domestic product grew 1.7 pct in 2004, the Statistics Office said, in line with economists' forecasts but slightly lower than the government's own forecast of 1.8 pct. In 2003, GDP declined by 0.1 pct Today's figures also showed that Germany exceeded the EU Stability and Growth Pact deficit criteria for the third year running, with the public deficit standing at 3.9 pct of GDP. In 2003 and 2002 the deficit stood at 3.8 and 3.7 pct respectively

To: TobagoJack who wrote (21224)	1/13/2005 10:18:19 AM
From: mishedlo	Respond to of 116555

UK construction orders up 3 pct in year to Nov from previous year - DTI Thursday, January 13, 2005 10:49:26 AM afxpress.com LONDON (AFX) - Construction orders in the year to November rose by 3 pct compared with orders in the previous twelve month period, government figures showed. The Department of Trade and Industry also said orders in the three months to November increased by 2 pct compared with the same period a year earlier However, it said orders in the three months to November fell by 4 pct compared with the previous three-month period. Decreases in public non housing and private commercial orders more than offset rises in public and private housing, infrastructure and private industrial orders, it said.

To: TobagoJack who wrote (21224)	1/13/2005 10:19:55 AM
From: mishedlo	Respond to of 116555

UK construction orders up 3 pct in year to Nov from previous year - DTI Thursday, January 13, 2005 10:49:26 AM afxpress.com LONDON (AFX) - Construction orders in the year to November rose by 3 pct compared with orders in the previous twelve month period, government figures showed. The Department of Trade and Industry also said orders in the three months to November increased by 2 pct compared with the same period a year earlier However, it said orders in the three months to November fell by 4 pct compared with the previous three-month period. Decreases in public non housing and private commercial orders more than offset rises in public and private housing, infrastructure and private industrial orders, it said.

To: TobagoJack who wrote (21224)	1/13/2005 10:24:38 AM
From: mishedlo	Respond to of 116555

ECB Statement - Alaron sent me this - Still can not find the official statement... In the statement, ECB officials noted that short-term inflation pressures have diminished, that fourth quarter growth should be moderate, and that sharp euro moves are unwelcome and undesirable. The comments followed the ECB's decision to leave its benchmark overnight rate unchanged at 2%, a factor that could give the dollar, with the Fed's overnight rate at 2.25% and rising, a minor advantage over the euro over time. Expectations had been for a more hawkish stance on inflation than the ECB statement ultimately gave.

To: TobagoJack who wrote (21224)	1/13/2005 10:28:19 AM
From: mishedlo	Respond to of 116555

ECB rates unchanged Thursday, January 13, 2005 1:03:59 PM afxpress.com FRANKFURT (AFX) - The European Central Bank said it left its leading interest rates unchanged following today's governing council meeting. Main refinancing operations will continue to be conducted as variable rate tenders with a minimum bid rate of 2.00 pct. The deposit rate remains at 1.00 pct and the rate on the marginal lending facility at 3.00 pct Rates have been at these levels since June 2003 Economists said the ECB is inclined to start raising rates when economic conditions permit, but the present moderate rate of economic growth and the euro's appreciation mean that it cannot tighten monetary policy just yet

To: TobagoJack who wrote (21224)	1/13/2005 10:32:21 AM
From: mishedlo	Read Replies (1) \| Respond to of 116555

UK Q4 GDP up 0.4 pct on previous 3 months, 2004 growth only 3 pct - NIESR Thursday, January 13, 2005 1:45:18 PM afxpress.com LONDON (AFX) - The UK economy continues to grow at below its so-called trend rate following another disappointing set of manufacturing data, a leading think-tank said today. The National Institute of Economic and Social Research is predicting that UK GDP in the three months to end-December increased by only 0.4 pct from the previous three months, below the estimated trend rate of growth of a quarterly 0.6 pct For the full year 2004, NIESR is predicting growth of only 3.0 pct, at the bottom end of both market and government expectations Today's data come in the wake of further weak manufacturing data, which showed the beleaguered manufacturing sector sliding towards recession once again as the expected rebound in output failed to materialise in November The office of National Statistics revealed that manufacturing output unexpectedly fell 0.1 pct in November from the previous month, the same as in October. The consensus of analysts' forecasts was for a 0.3 pct improvement That means manufacturing output, which accounts for just over 17 pct of the UK's overall GDP, has fallen for five of the last five months, suggesting the sector is likely to prove a drag on the economy in the fourth quarter However, NIESR does not see a case for an interest rate cut yet. Earlier, the Bank of England kept its key repo rate unchanged at 4.75 pct "Since the third quarter a number of factors have acted to improve prospects for the current year," NIESR said, noting the reduction in medium and long-term interest rates, including those of fixed-rate mortgages, lower oil prices and an increase in share prices. "We therefore continue to expect growth in the current year to be at or slightly above trend rates," NIESR said [must be another one of them soft landing calls. Everyone else is making them. may as well go with the crowd. mish]

To: TobagoJack who wrote (21224)	1/13/2005 10:42:09 AM
From: mishedlo	Respond to of 116555

U.S. Dec. import prices fall 1.3% on oil price drop Thursday, January 13, 2005 1:45:46 PM afxpress.com WASHINGTON (AFX) -- Led by a sharp drop in the price of oil, overall prices for imported goods fell at the sharpest rate in nearly two years in December, the Labor Department said Thursday. The prices of goods imported into the United States fell 1.3 percent in December, while non-oil import prices rose 0.5 percent in the month, the department said. Prices of imported oil plunged 11.5 percent after falling a revised 5.7 percent in the prior month. Economists polled by CBS MarketWatch had been expecting overall prices fall 0.4 percent in December

To: TobagoJack who wrote (21224)	1/13/2005 10:51:50 AM
From: mishedlo	Respond to of 116555

Germany´s Eichel still aiming to narrow 2005 budget deficit to 3 pct Thursday, January 13, 2005 2:03:24 PM afxpress.com Germany's Eichel still aiming to narrow 2005 budget deficit to 3 pct BERLIN (AFX) - Finance Minister Hans Eichel still plans to narrow the country's 2005 budget deficit to the 3 pct of GDP limit set out in the EU Stability and Growth Pact, according to Federal Finance Ministry spokesman Stefan Giffeler. Eichel also reiterated a 2004 budget deficit of 3.7 pct is realistic, he said. The Federal Statistics Office said earlier today Germany's 2004 budget deficit reached 3.9 pct of GDP, a level Giffeler says is partially based on estimates and will be revised at the end of February ======================================================================= Easy forecast They will be aiming to do this for the next 2 years At that point they will be at 5% aiming for 4% Then they will be calling for the stability pact to rise from 3% to 4%

To: TobagoJack who wrote (21224)	1/13/2005 10:58:00 AM
From: mishedlo	Respond to of 116555

U.S. Dec. retail sales increase 1.2% - Thursday, January 13, 2005 2:12:33 PM afxpress.com WASHINGTON (AFX) - Led by a big jump in autos, U.S. retail sales increased a seasonally adjusted 1.2 percent in December, the Commerce Department estimated Thursday [someone clue me in on this. did we really have big sales or are all of those cars sitting unsold on dealer lots? mish] Excluding the 4.3 percent rise in auto sales, retail sales gained 0.3 percent. [If that auto figure was channel stuffing, it looks like we had pretty bad dec sales - mish] The total sales figure was slightly ahead of expectations for an increase of 0.9 percent, while the ex-autos figure came in as expected, according to the survey of economists conducted by CBS MarketWatch. It was the biggest gain in sales since September's 1.6 percent rise. Sales in December were up 8.7 percent from December 2003. Sales in 2004 increased 8 percent from 2003, the biggest annual increase since 1999 Many retailers, especially for autos, have said they reduced prices in December to maintain good top-line sales growth as the Christmas shopping season started slowly [pricing power? what pricing power - mish] Sales in the fourth quarter were up 8.2 percent from the same quarter a year ago. The sales increase in October was revised higher by 0.2 percentage points to 1 percent. November sales gain was an unrevised 0.1 percent In November, ex-auto sales increased 0.4 percent In separate reports, the Labor Department said initial claims for jobless benefits rose by 10,000 last week to 367,000, while the more informative four-week average of new claims rose by 12,750 to 344,000. Import prices fell 1.3 percent in December, the Labor Department said in a separate report. In December, sales of durable goods were generally stronger than sales of nondurable goods With the 4.3 percent gain in December, auto sales rose 8.9 percent in the past 12 months Furniture sales rose 2.2 percent in December, while building material and hardware store sales gained 1.2 percent. Sales at electronics and appliance stores fell 0.2 percent Sales at general merchandise stores increased 0.7 percent, including a 0.2 percent gain at department stores Results at other retailers were mixed. Clothing store sales fell 0.6 percent, while leisure-time goods rose 0.9 percent. Sales at nonstore retailers such as catalogs and online stores jumped 1.9 percent Sales at health-care and personal care stores increased 0.2 percent Sales at food stores increased 0.4 percent, while sales at restaurants and bars gained 0.5 percent Sales at gasoline stations fell 2 percent as the price of gasoline declined. Gasoline sales were up 21.8 percent year-over-year. Total sales excluding gasoline rose 1.5 percent. Sales excluding both autos and gasoline increased 0.6 percent in December In the fourth quarter core sales rose at a 7.4 percent annualized rate, the best performance since the first quarter, said Ian Shepherdson, chief economist for High Frequency Economics. "Provided January holds up -- surveys suggest so far so good -- the overall holiday season will have been pretty good."

To: TobagoJack who wrote (21224)	1/13/2005 11:03:53 AM
From: mishedlo	Respond to of 116555

Trichet says short-term inflation pressures lessen somewhat as oil price falls Thursday, January 13, 2005 2:12:28 PM afxpress.com FRANKFURT (AFX) - European Central Bank governor Jean-Claude Trichet said that short-term inflation pressures have diminished somewhat as oil prices have come off their peaks seen in October Speaking after the ECB left interest rates unchanged, Trichet said iflation is expected to remain above 2 pct in the coming months, despite the decline in oil prices, but is then seen falling below 2 pct over the course of the whole year He said risks to price stability remain over the medium term, and the bank will show "continued vigilance." There is as yet no build-up in underlying domestic inflation pressures, he said. With regard to the foreign exchange markets and the strength of the euro against the US dollar, Trichet reiterated the central bank's view that this rise in 2004 was "unwelcome and undesrirable."

To: TobagoJack who wrote (21224)	1/13/2005 11:12:34 AM
From: mishedlo	Respond to of 116555

Trichet says short-term inflation pressures lessen as oil price falls UPDATE Thursday, January 13, 2005 2:33:46 PM afxpress.com (updating with further comments on growth prospects, stability and growth pact) FRANKFURT (AFX) - European Central Bank governor Jean-Claude Trichet said that short-term inflation pressures have diminished somewhat as oil prices have come off their peaks seen in October Speaking after the ECB left interest rates unchanged, Trichet said inflation is expected to remain above 2 pct in the coming months, despite the decline in oil prices, but is then seen falling below 2 pct over the course of the whole year He said that risks to price stability remain over the medium term, and the bank will continue to show "continued vigilance." There is as yet no build-up in underlying domestic inflation pressures, he said Trichet noted that "conditions remain in place for economic growth to proceed", with strong global demand seen sustaining euro area exports, while domestic investment should be supported by "very favourable financing conditions in the euro area" as well as improved corporate earnings and business efficiency [strong exports in the face of a cooling world economy with the Euro at an all time high. Does he really believe this? mish] With regard to the foreign exchange markets and the strength of the euro against the US dollar, Trichet reiterated the central bank's view that this rise in 2004 was "unwelcome and undesirable." [Unwelcome for who? The US sure seems to like it - mish] Turning to the EU Stability and Growth Pact, Trichet said that while improvements to what he deemed the "cornerstone" of economic and monetary union are possible, it would be "counterproductive" to change its regulations, dilute the 3 pct deficit limit or weaken the excessive deficit procedure [it probably would be counterproductive but I bet they do it - mish] The ECB supports an EU reform agenda as set out in the recent Kok report, he added

To: TobagoJack who wrote (21224)	1/13/2005 11:35:54 AM
From: mishedlo	Read Replies (1) \| Respond to of 116555

Risks of shocks in global economy rise: Fed´s Geithner Thursday, January 13, 2005 3:51:22 PM afxpress.com Risks of shocks in global economy rise: Fed's Geithner WASHINGTON (AFX) - A set of pressing macroeconomic problems has increased the probability of shocks to global financial prices, said Timothy Geithner, the president of the Federal Reserve Bank of New York "The probability of these shocks may be low, but it is higher than it has been, and higher than we should be comfortable with," Geithner said in a speech Thursday to a business group in New York He said the threats of shocks is not reflected in prevailing financial market prices Geithner said he was concerned about the weak fiscal policy outlook for the G7 nations. In addition, there has been a dramatic deterioration in the U.S. indebtedness, that cannot be sustained "These two broad forces coincide with the increasingly rapid integration of China and India into the global economy and financial system," he said A fourth challenge is the prospective changes in the global exchange rate regime. "The international monetary system now incorporates an uncomfortable disparity in the extent to which real effective exchange rates vary across regions," Geithner said The U.S. and Europe allow their exchange rates to float freely, while Japan is less enthusiastic and China and other Asian economies actively seek to keep their exchange rate fixed "The world has lived with this system for some time. But this is not an ideal mix...and it's probably not sustainable over time," he said "Without policy action commensurate with the challenges, we face some risk, it may not be high, but it is material, of a world with somewhat lower growth performance and higher volatility," he said The U.S. may be in better position to manage successfully through this period, Geithner added "Our underlying fiscal position is stronger, our debt to GDP burden lower, our demographic cliff more moderate and our trend growth rate substantially higher than that of the other major economies," he said [gag me with a spoon on this horsesh*t - mish] The U.S. economy begins the new year with "pretty solid underlying pace of growth," Geithner said "Core inflation is moderate and various measures of inflation expectations suggest confidence in the outlook for price stability," he added

To: TobagoJack who wrote (21224)	1/13/2005 11:42:08 AM
From: mishedlo	Respond to of 116555

UPDATE 2-Oil climbs $1 as U.S. gas spikes higher Thursday, January 13, 2005 4:12:52 PM reuters.com (Updates prices, adds U.S. gas data) LONDON, Jan 13 (Reuters) - Oil prices climbed a dollar to sit well above $47 a barrel on Thursday as U.S. natural gas prices rose following the release of stockpile data showing tighter supplies. U.S. light crude <CLc1> rose $1.03 to $47.40, after hitting an intraday peak at $47.60 a barrel. London Brent <LCOc1> rose $1.03 to $44.71, while U.S. heating oil <HOc1> gained more than two percent. Gains were given extra momentum by a surge on U.S. natural gas futures prices <NGc1>, which jumped more than five percent following a stockpile draw. Government data from the Energy Information Administration showed natural gas stocks sliding 88 billion cubic feet to 2,610 bcf last week, with the draw concentrated in the eastern region. The gains added to a rally fired by petroleum stock statistics released on Wednesday that showed a larger-than-expected three million barrel draw on U.S. crude inventories to almost 289 million barrels. That data had also showed a 500,000-barrel decline in U.S. heating oil stocks to 49.6 million barrels, although overall distillate supplies increased by 1.9 million barrels to 123 million. Global supply outages and forecasts for colder weather in the U.S. Northeast have underpinned the market this week, keeping prices at the top end of their six-week range. More than 500,000 barrels per day (bpd) of output in the U.S. Gulf of Mexico, Nigeria and Norway's North Sea remains offline, although Norwegian authorities have allowed for the restart of about half the 205,000 bpd of output halted by a gas leak in late November. Iraqi exports have been reduced by continued sabotage on its northern pipeline infrastructure and power problems in the south, forcing Baghdad to cut all its February-June Basra Light sales contracts by 10 percent, or about 160,000 bpd. Worries that sabotage attacks will intensify around the planned Jan. 30 elections also have added a premium to prices. Stormy weather has interrupted loading operations and tanker traffic in parts of the UK North Sea and at Latvia's Ventspils terminal and in Turkey's Bosphorus and Dardanelles straits. The disruptions coincide with OPEC's implementation of a 1-million-bpd output cut from Jan. 1. The Organisation of the Petroleum Exporting Countries is scheduled to meet on Jan. 30 to discuss whether further cuts may be necessary as the northern winter ends and oil demand seasonally falls in the second quarter. Some members say the cartel will consider tightening taps if prices fall below $40 a barrel.

To: TobagoJack who wrote (21224)	1/13/2005 11:54:02 AM
From: mishedlo	Read Replies (1) \| Respond to of 116555

Trichet says G7 agree on economic measures needed in US, euro zone, Japan Thursday, January 13, 2005 4:27:43 PM afxpress.com FRANKFURT (AFX) - European Central Bank president Jean-Claude Trichet said there is a strong consensus among G7 countries about the economic measures that are needed to correct global current account imbalances The euro zone and Japan both need to implement structural reforms to boost their growth potential and the US has to boost its savings rate, he said [lovely concensus - when does action start? Will it do any good? Why? For who? mish] "The present global consensus...is that we all have homework to do. There is a consensus of the international community to consider that structural reforms are of the essence in the euro area and in Europe as a whole because it is the appropriate way to elevate the growth potential," he told an ECB news conference "There is also a consensus to say the same as regards Japan, and note the savings issue in the US as being a very important question for them," he added [Let's see there is a concensus that Japan needs to consume .... But the Japanese are not buying stuff. So what good does that concensus do? mish] Trichet said this consensus is also shared by the G10 group of central bankers, which he chairs And he said there is also a G7 consensus that the currencies of some emerging economies in Asia need to appreciate, as has been stated in the communiques issued after several recent G7 meetings [Here is another lovely concensus. How useful is it when Japan does not want the YEN to rise and China is pegged. Mish] Trichet declined to comment on how he and euro group president Jean-Claude Juncker would react if the US called for more stimulatory euro zone monetary and fiscal policies at the Feb 4-5 G7 meeting in London [Oops - loosk like we have a non consensus. The US wanta Europe to cut rates and Europe wants to raise them (but they cant because of the Euro). The US wants the EU to consume more but like the Japanes, Europeans do not want to consume more. mish] Juncker attended today's ECB council meeting Trichet said he had praised US Treasury Secretary John Snow' recent commitment to take steps to support the dollar, particularly by working to curb the US budget and current account deficits, because he considered this an important statement [If ever there was a lie, that "committment" was it. mish] "When things are said that are, in my opinion, important and excellent, why not mention it?" he said Speaking after the G10 central bankers' meeting on Monday, Trichet praised Snow's restatement of the US administration's strong dollar policy and his commitment to tackle US deficits Trichet today declined to comment on yesterday's news that the US trade deficit widened to a record 60.3 bln usd in November, which weighed on the dollar, but he indicated that the trade deficit is part of the problem of global current account imbalances "I don't comment on figures that are produced on a month to month basis, but as one of the risks that we have at a global level in the economy...there is certainly the constellation of imbalances," he said [Splotto that is a catchy phrase "constellation of imbalances" let's get a trademark on it. Mish]

To: TobagoJack who wrote (21224)	1/13/2005 12:10:25 PM
From: mishedlo	Respond to of 116555

Dixons calls for cut in interest rates By Susie Mesure 13 January 2005 The Bank of England should cut interest rates to avert a complete collapse in consumer confidence, the chief executive of Dixons urged yesterday. John Clare, who was speaking as the electricals group defied doomsayers to report a strong Christmas, said he hoped such a cut would come "sooner rather than later". After five interest raterises in the past 14 months, Mr Clare warned: "It's a different consumer out there than six months ago in terms of optimism and propensity to buy, and the Bank needs to be aware of that. It put up interest rates to take the heat out of the UK economy, and by God, the heat has been taken out of it." Retailers have endured their worst eight weeks of trading for six years, industry figures showed this week. Economists expect the Bank's Monetary Policy Committee to leave the base rate at 4.75 per cent today. Mr Clare's comments came as Dixons reported a 3 per cent rise in underlying group sales during the four weeks to 8 January. Negative like-for-like sales at PC World and The Link, its mobile phone chain, took the shine off strong sales growth at its Currys and Dixons chains. Shares in the group edged 0.5p higher to 157p on relief that the group had limited the damage to group gross margins despite intense price deflation. Nick Bubb, an analyst at Evolution Securities, said: "Dixons has been a potential Christmas casualty, ever since the gloomy pre-close in November but the update and first-half results today are OK overall." Sales of flat screen televisions, personal DVD players, internet audio players such as Apple's iPod and in-car navigation systems drove like-for-like growth of 8 per cent at Currys and 10 per cent at Dixons over the four-week festive period. The popularity of MP3 players this year ate into mobile phone sales, last year's stellar performer. Underlying sales at The Link slumped 9 per cent, putting pressure on shares in Carphone Warehouse ahead of its post-festive update today. Much cheaper computers hit underlying sales at PC World, which fell 3 per cent in the four-week period. Desktop PCs cost up to 20 per cent less than this time last year, Mr Clare said, reflecting the weakness of the US dollar and intense competition. While Dixons' Christmas figures put it among the high street winners, its like-for-like sales growth has slowed since the first half of its financial year. Mr Clare said gross margins remained under pressure, hit by fewer customers using in-store credit offer and lower sales of margin-boosting warranties. "The message is the consumer market has slowed and it has slowed quite rapidly. We are cautious about the consumer economy," Mr Clare said.