In the euro area, consumer confidence (-19.8 from -20.3) and business confidence indices should start to reflect improved market conditions and the easing of risks over the past two months. In March the composite PMI is expected to return into an area compatible with stagnant GDP growth (49.8 from 49.3). Producer prices will provide an indication….
Tuesday 20 March
Euro area
– Germany. Producer prices could be up by 0.6% m/m as a result of tensions generated by oil prices, with the year-on-year rate expected to come in at 3.3% y/y thanks to a favourable base effect. Pressures tied to energy commodity prices are likely to linger in the months ahead, pushing producer prices up.
United States
– In February, housing starts should drop to 685k from 699k in January. In the past two months, starts grew at a much faster pace than licenses, driven by milder weather conditions than usual; in February, the pace of growth should slow to levels more compatible with the trend of licences. Permits should come in broadly stable at 685k, from 682k in January.
Wednesday 21 March
United States
– Sales of existing homes are estimated at 4.55 million, from 4.57 million in January. In recent months, pending home sales stabilised, and are not pointing to an increase in sales. Mild weather conditions are supporting activity in the sector, but applications for new mortgages dropped last month and point to a slight slowdown.
Thursday 22 March
Euro area
– The manufacturing PMI is expected to show a slight recovery in March, staying in any case on levels (49.5 in March from 49.0 last month) compatible with a stagnation of production activity. The services PMI could recover less than the manufacturing index, as it typically lags the latter (49.1 from 48.8). The composite PMI could climb to 49.8 from a previous level of 49.3. In the months ahead we expect the PMI and confidence indices to recover at a brisker pace. The balance of risks has changed significantly since December, with the marked improvement of labour market conditions and easing uncertainty reaping positive effects on the confidence, and therefore on the spending decision, of enterprises and households. Relative performances within the euro area will continue to be markedly mixed, with Germany (manufacturing PMI forecast at 51.2 in March) leading the way, followed suit by France (manufacturing PMI at 50.4), already back in expansive territory.
– Household confidence is forecast at -19.8 in March, from -20.3 in February, as improved overall sentiment should positively impact both views on the present macro situation and spending decisions. Inflation expectations are likely to rise further, fuelled by tensions on petrol prices.
Friday 23 March
Euro area
– France. The INSEE manufacturing sector confidence index should rise back in March to 93, from 92 the previous month (long-term average: 99). National confidence indices remain on more depressed levels than the PMI, and are compatible with a weaker trend of production in the opening months of 2012 compared to the end of last year, when GDP growth in Frances surprised on the upside.
United States
– Sales of new homes in February should be on the rise to 330k, from 321k in January. Mild weather conditions and the ongoing improvement in construction sector confidence bode well for February sales
Appendix
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