In the euro area, the calendar of macro data releases at the turn of the year will most notably bring completion of the round of monthly surveys for December (EU Commission economic sentiment index,………..
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Focus should rest mostly on the ECB meeting of 10 January, where no action is expected to be taken neither on non-standard measures nor on interest rates.
Data due for release in the next few weeks in the United States should confirm a moderate uptrend in employment, weak manufacturing, and a positive trend in residential construction.
The solution of the fiscal cliff and debt ceiling issues will represent an element of discontinuity in data, with business confidence and activity probably taking a positive turn in the opening months of 2013.
Thursday 27 December
Euro area
– Italy. Confidence among manufacturing companies as measured by Istat is expected to prove stable in December, at 88.5, after recovering the previous month. The index remains depressed, on levels well below the long-term average (100.4). Broken down data in November showed an improvement in expectations, as opposed to still contracting foreign
orders. Indications of a reversal in the trend of foreign demand seem to point to a gradual stabilisation of activity in the manufacturing sector.
United States
– Consumer confidence in December should drop to 69 from 73.7 in November. The University of Michigan index declined visibly in December, and should be followed suit in the month by the other indices. Confidence should return to levels in line with those seen early in the autumn.
– Sales of new homes are expected to have risen in November to 390k from 368k in October.
The sharp uptrend in the current and future sales components of the builders’ confidence index points to an acceleration in the pace of growth of new home sales.
Friday 28 December
Euro area
– France. Consumption of manufactured goods is forecast stable in November, after three months on the decline. The November figure should again outline a contraction in auto sales, as opposed to a slight recovery for the other components. If confirmed, the reading would leave the quarterly trend on course for a +0.2% q/q increase in December, in line with the trend seen over the summer months. The figure points to 0.1% q/q growth in consumption at
the end of the year. The underlying trend for French consumption is rather lacklustre, given the deterioration in household confidence and worsening conditions on the labour market.
United States
– In December, the Chicago PMI should rise to 51 from 50.4 in November. The recovery of activity in the auto sector should continue, after slowing briefly due to the effects of hurricane Sandy. Extraordinarily strong auto sales in November should prompt an acceleration in production in December as well, supporting a modest rebound of the Chicago PMI.
Monday 31 December
Euro area
– Germany. Retail sales are forecast to recover by +0.4% m/m in November, after slipping sharply the previous month (-1.3% m/m). The purchasing power of households continues to improve, albeit at a slower pace than in the first half of the year. The weak trend of consumer spending over the summer months is probably explained by uncertainty on financial markets and by the fact that households invested a significant share of their income in the summer to
stock up on energy, given the favourable prices. Based on vehicle registration data, auto sales remain weak. If confirmed, the November sales figure would leave the quarterly trend on course for a -1.0% q/q drop, given the weak entry into the quarter.
Wednesday 2 January
Euro area
– The second estimate of the December manufacturing PMI should confirm the preliminary reading of 46.3, broadly in line with the previous month. Confidence indices remain compatible with a stabilisation of industrial activity on depressed levels.
– Germany. Data from the Laender should outline higher consumer prices by +0.7% m/m in December, as a result of an unfavourable base effects. On an annual basis, inflation should stay unchanged at 1.9% y/y at the national level, although the harmonised rate may temporarily rise back to 2.0% y/y. In 2013, German inflation is estimated to average 1.6%, from 2.1% in 2012.
– Spain. The preliminary estimate should show that inflation rose back to 3.2% y/y in December, from 2.9% the previous month, due to an unfavourable seasonal trend, offset only in part by the negative contribution of energy.
United States
– The manufacturing sector ISM should stay broadly flat in December, at 49.7 from 49.5 in November. A modest recovery in orders and employment from the compressed levels seen in December should help the composite index re-approach the 50 mark. Based on our estimates, starting in January avoidance of the fiscal cliff and a reacceleration in global growth, especially in Asia, should contribute to a recovery in activity in the manufacturing sector.
Thursday 3 January
Euro area
– The trend of the M3 aggregate is expected to pick up further in November, to +4.0% y/y from 3.9% y/y the previous month. More in detail, we expect the M3-M2 aggregate to grow at a faster pace. The 3-month moving average would therefore rise to 3.5% from 3.1%. Among M3 counterparts, we expect credit to the private sector to improve slightly. The trend of M3 is still compatible with the ECB’s price stability objective.
– Germany. In December, the jobless figure could rise by 25k, although the unemployment rate is forecast stable at 6.9%. In the months ahead, the slowdown of the cycle, in the manufacturing sector in particular over the summer and at the end of 2012, will have an increasingly strong impact on the employment trend. We expect the unemployment rate to
rise to 7.5% by the end of year, as it typically lags the cycle.
United States
– The minutes of the FOMC’s December meeting should shed light on the discussion on the expansion of the asset purchase programme, introduced in December, providing a more picture of opinions within the FOMC regarding the likely duration of the programme. We stick to our view that purchases will be made throughout fiscal year 2013, at least until October.
– Automobile sales in December should stay upbeat, showing a modest decline to 15.2 million ann. from 15.46 million in November, when sales surged by +8,7% m/m following the slump caused by hurricane Sandy. The trend of auto sales will stay positive in 2013.
Friday 4 January
Euro area
– The second estimate of the composite PMI should confirm the preliminary reading of 46.5, from 45.7 the previous month. The services PMI improved by seven tenths, to 46.7, on the back of greater optimism in Germany, where the index returned above the 50-point threshold. The synthetic index remains on levels compatible with a “light recession” in euro area GDP at the turn of the year.
– Inflation is expected to drop to 2.1% y/y from a previous rate of 2.2%, thanks to easing pressures from the energy component. Euro area inflation should drop back below 2% already at the start of 2013.
– Italy. Inflation is estimated to decrease to 2.4% y/y in December from 2.6% y/y the previous month in harmonised terms, as a result of easing pressures from the energy component, and thanks to an only slightly unfavourable seasonal effect. In the month, consumer prices are expected to grow by +0.2%m/m.
United States
– Non farm payrolls are forecast to rise by in 165k December, from +146k in November. The average for 2012, of 152k, would therefore stay in line with the levels recorded over the past two years. The unemployment should rise back to 7.8% from 7.7% in November, as a result of the forecast increase in the participation rate (that had dropped by two tenths in November). Hourly wages should keep growing at a very slow pace, at +0.1% m/m.
– The non-manufacturing ISM should be down marginally in December, to 54.5 from 54.7 in November. The November survey was relatively positive, with orders on the rise to 58.1 from 54.8, and activity up sharply to 61.2 from 55.4. Over the past few months, the services sector has outperformed the manufacturing sector: in 2013, this situation should reverse, as forecasts point to a more solid recovery for manufacturing.
Tuesday 8 January
Euro area
– The economic sentiment index in the euro area is estimated to keep recovering in December, to 85.9, from a previous level of 85.7. More in detail, in line with the indications provided by national surveys and PMIs, we expect confidence to improve in the services sector and, to a lesser degree, in manufacturing. Sentiment among households should improve a little more, to -25.9 from a previous reading of -26.9. The Commission’s index is still on values well below
the long-term average, indicating that the euro area economy is still weak, although the cycle should by now have stabilised on low levels.
– The unemployment rate in the euro area could take a breather in November, staying at 11.7% after the previous month’s increase. In the months ahead, the cycle will continue to weigh on employment prospects, and unemployment may even rise to 12.2% by the end of 2013.
– Italy. The unemployment rate could rise further in November, to 11.2%, despite increasing over previous months. The cycle will continue to weigh on employment prospects until 2013, and unemployment is expected to peak at 11.6% by the summer.
– Germany. Factory orders in November may reabsorb part of the unexpected improvement recorded the previous month. We expect a 1.0% m/m decline, which, if confirmed, would leave the quarterly trend on course for a 1.9% q/q rise at the end of 2012, pointing to a recovery in industrial activity already at the outset of the year.
Wednesday 9 January
Euro area
– Germany. Industrial output should rebound by 1.0% m/m and offset part of the sharp contraction seen in October (-2.3% m/m), which, however, may be revised upwards. The reading would in any case leave output on course for a 2.5% q/q decline. Therefore, a contraction in German GDP by 0.2%-0.3% q/q at the end of the year cannot be ruled out.
Thursday 10 January
Euro area
– The ECB meeting should be rather interlocutory. In the past month, economic data, and confidence surveys in particular, have pointed to a stabilisation of the cycle at depressed levels. However, the expectations component improved in Germany. Assessment of the macro scenario should therefore be broadly unchanged compared to December. An adjustment of the refi rate already in January is unlikely in our view.
– France. Consumer prices are estimated to show a 0.3% m/m rise. Inflation should moderate to 1.4% y/y, from a previous rate of 1.6% y/y in harmonised terms, and to 1.3% y/y from 1.4% y/y at the national level. Inflation in France should stay broadly in line with November in the coming months, after dropping temporarily to 1.2%-1.3%.
– France. Industrial production is expected to increase by 0.1% m/m in November, after declining in October and September. Manufacturing output should grow by 0.2% m/m, whereas energy could drop marginally after rising sharply in early in the autumn. The reading would leave output on course for a -1.9% q/q contraction in the quarter, compatible with a 0.2% q/q drop in GDP at the end of 2012.
Friday 11 January
United States
– In November, the trade balance deficit should decrease to -41.5 billion dollars. The sharp drop in import prices in the month, and of oil prices in particular, combined with a correction of export prices, in a context of still weak global growth and stagnant manufacturing activity in the US, should leave the trade balance on the downtrend outlined in recent months.
Appendix
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