US Recession Is Technically Over
The worst US recession since the 1930s is technically over. However, it is difficult to determine the exact date of the end of the recession as economic indicators are mixed with personal income and employment data still weak. The Globicus coincident index, while indicating the recession ended in June or August, has still not bottomed in a clear way.
US Macro: January Nonfarm Payrolls -20K; Jobless Rate 9.7%
US nonfarm payrolls unexpectedly declined 20,000 in January, much smaller than a revised 150,000 December drop that was larger than previously reported, figures from the Labor Department showed. The unemployment rate unexpectedly fell to 9.7%, the lowest since August, from December's 10.0%, indicating labor market conditions have improved. See also other recent updates on US economic data and macroeconomic trends.
Europe Macro: February Sentix Eurozone Investor Sentiment
The Sentix eurozone investor sentiment index unexpectedly declined to -8.2 in February from -3.7 in January, indicating eurozone investor confidence fell for the first time in seven months, data released by Sentix showed.
Asia Macro: January Japanese Economy Watchers Survey
Japanese merchant confidence rose for a second month in January. The Japanese current conditions index increased to a higher-than-expected 38.8 last month from 35.4 in December, according to the Cabinet Office’s latest economy watchers survey.
Equities: Daily US Stocks
The major indexes have broken their strong uptrends. The appreciating dollar increases the deflationary risk and can end the bull market in stock and the global recovery.
Fixed Income: Credit Spreads Indicate Recovery
Treasury interest rates have risen off their lows, credit spreads have narrowed and interbank rates have declined, indicating the financial panic is over and the economic outlook is improving.
Commodities: Daily Commodities
Commodities may be topping out as China tightens.
Globicus Canadian LEI
The Globicus/qEcon Research Canadian overall leading economic index rose to 4.9 in October from 3.2 in September.
Globicus EMU LEI
The Globicus/qEcon Research EMU overall leading economic index grew to 5.1 in November from 4.9 in October.
Globicus German LEI
The Globicus/qEcon Research German overall leading economic index eased to 8.6 in December from 9.1 in November.
Globicus UK LEI
The Globicus/qEcon Research UK overall leading economic index increased to 6.6 in November from 6.0 in October.
Globicus Japanese LEI
The Globicus/qEcon Research Japanese overall leading economic index eased to 6.0 in November from 6.3 in October.
Globicus Australian LEI
The Globicus/qEcon Research Australian overall leading economic index increased to 1.8 in November from 0.0 in October.
December Canadian LEI +1.5% m/m
Canada’s leading economic indicators index rose a more-than-expected 1.5% m/m to 229.0 in December, a seventh consecutive monthly rise and matching February 1983 for the biggest monthly gain since September 1958, after a 1.3% m/m increase in November, LEI data from Statistics Canada showed.
Preliminary December Japanese LEI
The Japanese leading economic indicators index, a measure of future economic activity, rose to a higher-than-expected 94.0 in December, a tenth straight monthly gain, from a revised 91.0 in November, according to preliminary December LEI data released by the Cabinet Office.
November Australian Westpac-Melbourne Institute LEI
The pace of the Australian economic recovery has progressed remarkably. The Australian Westpac-Melbourne Institute leading economic index, a measure of future economic activity, increased 1.0% m/m to 256.8 in November, with its annualized growth rate accelerating to 7.6%, the fastest pace since November 2007, from October’s 5.8%, Westpac Banking Corp. and the Melbourne Institute reported.
A Primer on Deflation
In the WWII period, low inflation did not induce fears of deflation because economists believed the institutions created by the Keynesian revolution had a bias toward inflation. After more than 50 years of absence, deflation has now reappeared on the agenda as something to worry about. So what is deflation? Deflation is defined as persistent declines in the general price level.
