The Lastest Macroeconomic News
01.02.2009 17:59 The US economy contracted by an annualized 3.8 per cent in the final quarter of 2008
The US economy contracted by an annualized 3.8 per cent in the final quarter of 2008, according to advance estimates released on Jan 30, a much smaller percentage than expected but still its worst performance since 1982. The decline, led by a build-up in inventories – which boosted GDP by 1.3 percentage points – offered little hope for an economic turnaround, since production is likely to continue to slow as companies seek to draw down their stock. The fourth-quarter contraction follows a contraction of 0.5 per cent in the previous quarter. The decline in growth was broad based, with consumption falling at an annualized rate of 3.5 per cent and sales of motor vehicles, food, and furniture and equipment significantly down, according to figures from the Bureau of Economic Analysis. Government efforts to boost the economy were less effective than in the third quarter. Fourth-quarter federal government spending boosted growth 0.4 percentage points, compared with 1.1 percentage points the quarter before.
28.01.2009 21:20 Russia`s GDP grew 6.0 percent in 2008, but contracted 0.7 percent in December
Russia`s economy contracted 0.7 percent in December, Interfax news agency reported on Monday, quoting an unnamed source. The December decline reins in full-year 2008 growth to 6.0 percent, broadly in line with expectations and down from 8.1 percent in 2007, Interfax reported. It also said that capital investment in Russia fell 2.3 percent in December. Russia`s economy will contract by 0.2 percent this year, deputy economy minister Andrei Klepach said, slashing an earlier forecast that called for 2.4 percent growth in 2009, from around 6 percent in 2008. "I confirm these numbers," Klepach told Reuters by phone, confirming a report on the revisions by Russia`s Interfax news agency. The forecast revisions, based on a new and sharply lower average oil price assumption of $41 per barrel, still see a $24 billion trade surplus in 2009, due to rapidly shrinking imports. Prime Minister Vladimir Putin this week ordered officials to recalculate the 2009 budget taking into account the lower oil price. The new budget is likely to have a deficit, which Russia plans to cover from its rainy day oil funds. Economy Minister Elvira Nabiullina said earlier she saw the rouble at an average of 35.1 to the dollar in 2009, according to the forecast.
21.01.2009 21:45 Inflation in Russia has been 1.2% so far this year, against 1.8% for the same period last year
Inflation in Russia has been 1.2% so far this year, against 1.8% for the same period last year, the Federal Statistics Service said. Between January 13 and January 19 consumer prices increased 0.4%. According to government officials and experts, inflation for the whole of January is expected to be lower than in January 2008 but could rise in February. Finance Minister Alexei Kudrin said Monday that Russian consumer prices could grow 13% in 2009. In 2008, Russia`s inflation reached 13.3%, according to the Federal Statistics Service. Russia`s consumer prices could grow 13% in 2009, Russian Finance Minister Alexei Kudrin said at the Asian Financial Forum. In 2008, Russia`s inflation reached 13.3%, according to Russia`s state statistics service, Kudrin said on the first day of the two-day forum in Hong Kong. "We expected it [inflation] to fall to 11%, but in connection with [the ruble`s] devaluation which will affect the growth of prices for imports, we now expect it to be around 13%," said Kudrin, who is also a deputy prime minister.
18.01.2009 19:26 U.S. Industrial Production Fell 2% in December 2008, Led by Autos
U.S. industrial production fell twice as much as forecast in December as companies pulled back to try to weather the global economic slowdown. Auto output fell to the lowest in more than a quarter century. Output at factories, mines and utilities dropped 2 percent, after a revised decline of 1.3 percent in November that was more than double the previously reported decrease, the Federal Reserve said in Washington. Plant use matched the lowest level since 1983. Factories are reducing output and spending as export demand drops and U.S. retail sales endure the longest string of declines in at least 16 years. Industrial production was projected to drop 1 percent, according to the median forecast in a Bloomberg News survey of 77 economists. Estimates of the decline ranged from 0.2 percent to 2.5 percent. Capacity utilization, or the proportion of plants in use, fell to 73.6 percent, matching the lowest level since April 1983, from 75.2 percent in November. Last month`s plant use rate was 7.4 percentage points below the average level for 1972 to 2007, the Fed said. Economists had forecast plant use would fall to 74.5 percent, according to the Bloomberg survey. Factory output, which accounts for about four-fifths of industrial production, decreased 2.3 percent, led by a 7.2 percent decline in production of autos and parts. Production of consumer durable goods, including autos, furniture and electronics, fell 4.7 percent. Utility production decreased 0.1 percent after rising 1 percent a month earlier. Mining output, which includes oil drilling, dropped 1.6 percent after a 2.2 percent increase.
17.01.2009 13:05 Eurozone industrial production declined 7.7% year-on-year in November 2008
Eurozone industrial production continued to decline for the seventh consecutive month in November, official data showed. Elsewhere, the Organization for Economic Cooperation and Development or OECD forecast deepening recession in the euro area. Data released by the Eurostat showed that industrial production declined 7.7% year-on-year in November, following a 5.7% drop in October, which was revised from 5.3% fall originally reported. The November decline was quicker than expected drop of 6.1%. On a monthly basis, industrial production declined 1.6% in November after falling at the same pace in October. Economists had expected a 2.1% fall in November, while the decrease recorded in October was revised from a 1.2% fall reported initially. With the latest fall, industrial production declined for the third straight month. In November, production of non-durable consumer goods grew 0.1% month-on-month and that of energy decreased 1.5%. Output of capital goods declined 1.8% followed by 2.4% fall in durable consumer goods production. Intermediate goods production fell by 2.8% in both zones. Among the member states for which data were available for November 2008, industrial production fell in eighteen and rose only in Ireland and Greece. The most significant falls were registered in Slovenia, Estonia, Slovakia and Portugal.
13.01.2009 20:51 EBRD said the Eurasian economies are expected to see a slowing of growth in 2009
The Russian economy and the Eurasian economies are expected to see a slowing of growth in 2009, as a consequence of falling prices for oil and other commodities, the European Bank for Reconstruction and Development (EBRD) forecasted. EBRD said Russian GDP will grow 3-4 percent in 2009 compared to 7.3 percent in 2008. The Ukraine economy will grow 1.0 percent this year - the lowest pace in the region. The Kazakh economy is forecasted to grow on average by between 2.7% and 4.1% a year from 2009-2013. GDP per capita is projected to reach just over $13,000, considerably lower than the earlier forecast of $15,737. This follows almost a decade during which GDP growth averaged just under 10% a year. The much lower forecasts are a consequence of the dramatic decrease in the prices for oil and other commodities, which make up the bulk of Kazakhstan`s exports, since mid-2008. In Uzbekistan, EBRD forecasts a gradual decline in GDP growth from 9.5% in 2007, to 8% in 2008 and 7% in 2009. Azerbaijan, which saw a stunning 23.4% expansion of the economy in 2007, has a growth forecast of 17% in 2008 and 15% in 2009. Countries such as Kyrgyzstan and Tajikistan, which are less dependent on commodity exports, have also come under pressure due to the slowdown in their trading partners – chiefly Russia and Kazakhstan. The smaller CIS economies are also expected to see a contraction in remittance payments from migrant workers abroad. Only Turkmenistan appears exempt from the international downturn, with growth remaining at a steady 12% in 2008 and 2009. The Caucasus suffered a setback when war broke out between Georgia and Russia over the separatist South Ossetia in August 2008. The consequences for Georgia were the most severe, but Armenia`s economy has also been affected, while oil exports from Azerbaijan were temporarily cut.
10.01.2009 15:05 U.S. jobless rate at 16-year high as payrolls plunge
The U.S. unemployment rate surged to the highest in nearly 16 years last month as a deepening year-long recession forced companies to axe more than half a million jobs, government data showed. The U.S. economy lost an astonishing 1.9 million jobs in the past four months alone, an acceleration in layoffs towards the end of a year that brought the biggest drop in employment in more than a half century. In all of 2008, 2.6 million people lost their jobs, the largest slump in employment since a 2.75 million drop in 1945. The December data pointed to a bleak start for 2009 and increased chances the economic downturn could become the longest since the 1930s. "This is a very dismal report. This paints a much worse picture in 2008 than we had thought," said Lindsey Piegza, market analyst at FTN Financial in New York. "This is one of the most significant downward quarters for jobs in post World War (Two) history." The Labour Department said the unemployment rate jumped to 7.2 percent last month, the highest since January 1993, from 6.8 percent in November. The rise was driven by massive layoffs in all major sectors except government, education and health. In all, employers cut nonfarm payrolls by 524,000 last month. While that was a bit less than analysts had predicted, job loss totals for October and November were revised upward and came in much higher than previously estimated.
02.01.2009 12:18 The Economic Development Ministry: Russia`s GDP grew 1.6% in November 2008
Russia`s GDP grew 1.6% in November, but dropped by 0.7% when adjusted for seasonal factors, the Economic Development Ministry said. "The indication of the negative consequences of the global financial crisis on Russia`s economy grew in November. GDP growth was 1.6% after 6.9% in September and 5% in October on the same period last year," the ministry said. "Since July there has been a decline once seasonal factors are excluded, in November it was 0.7%," the ministry said. Industrial output fell 7.5% in November, the second consecutive monthly decline, the ministry reported. "The industrial production index was 91.3% in November 2008 against November 2007, which means a 7.5% output decrease as compared to October, excluding seasonal factors," the ministry`s monitoring report read. The ministry said this was the result of a recession in manufacturing industries, as well as electricity, gas and water production and distribution. According to the ministry`s preliminary forecast, Russia`s GDP in January-November grew 6.5%. Russia`s GDP will grow about 2% in 2009 while inflation will be 10-12%, presidential aide Arkady Dvorkovich said. Last week, Russian Economic Development Minister Elvira Nabiullina said Russia`s forecast GDP growth for 2009 was 2.4%, while inflation was predicted to be 11% against 13.5% for this year.
28.12.2008 21:30 Russia`s GDP will grow about 2% in 2009 while inflation will be 10-12%
Russia`s GDP will grow about 2% in 2009 while inflation will be 10-12%, presidential aide Arkady Dvorkovich said. Last week, Russian Economic Development Minister Elvira Nabiullina said Russia`s forecast GDP growth for 2009 was 2.4%, while inflation was predicted to be 11% against 13.5% for this year. According to the ministry`s preliminary forecast, Russia`s GDP in January-November grew 6.5%. At the same time, global economic growth will grind into a low gear in 2009, according to a new study released by the World Bank. The multilateral development bank said the world economy will expand by only 0.9 per cent next year after seeing a global GDP expansion of 2.5 per cent in 2008. The bank noted that world GDP grew by 3.7 per cent in 2007. Developing countries, such as sub-Saharan Africa, will enjoy a faster economic expansion than most industrialized countries in 2009, but are still at risk from a slowdown in export sales and as commodity prices drop, the World Bank said in releasing its forecast.
23.12.2008 23:00 The U.S. economy contracted at a 0.5% annual rate in Q3 2008
There`s been no change in the U.S. economy`s pulse, according to the most recent GDP data from the U.S. Commerce Department. The U.S. economy contracted at a 0.5% annual rate in Q3, the Commerce Department announced, in its final reading on the quarter. The rate was unrevised from the previous estimate, but it was the weakest quarterly growth rate since Q1 2001. Economists surveyed by Bloomberg News had expected the economy to contract at a 0.5% annualized rate in Q3. One danger sign for the economy: consumer spending, which accounts for 60-65% of U.S. GDP, declined at a revised 3.8% annualized rate in Q3, worse than the 3.7% annualized decline estimate announced earlier. One bright spot concerns inflation: core consumer inflation, which excludes the often-volatile food and energy component, was revised lower to a 2.4% annualized rate in the quarter, from the 2.6% previous annualized rate. The 2.4% rate is roughly within the U.S. Federal Reserve`s "comfort zone" for inflation. Wang called the inflation data "very tame." Further, Wang expects the world`s largest economy to shrink at a troubling 4.0% rate in Q4, and to keep contracting through at least through the end of Q2 2009. That would mean a recession of 18 months - the longest U.S recession since 1947.