Top Economic Reports
May 07, 2013
By Global Economic Team|
European Eco Weekly: Factoring in ECB Rate Cut: Euro Area: The ECB Governing Council meeting in Bratislava will most likely be the center of attention. Yet, the timing as well as the size of the changes in the three key policy rates remain wild cards. Given the strong language used at the last press conference, a significant easing in inflation pressures and the marked deterioration in the data, our base case is a 25bp cut in the main refinancing rate at the May meeting. Olivier Bizimana
U.S. Economics: GDP
* Close to our forecast, real GDP growth posted a 2.5% gain in Q1, a surprisingly resilient start to the year in the face of substantial fiscal tightening and rising signs of slowing global growth.
* The better than expected 3.3% gain in final private domestic demand reflected better than expected gains in consumption (+3.2%) and business investment (+2.1%) and another solid gain in residential investment (+12.6%).
*While private sector demand held up surprisingly well in Q1, fiscal drag was again substantial and will likely increase further in Q2. Overall government spending fell 4.1% in Q1, with federal pending down 8.4% on top of a 14.8% plunge in Q4 and state and local spending down 1.2%, the thirteenth drop in the last fourteen quarters. Ted Wieseman
Netherlands Economics: Dutch Economy Still in the Doldrums: In line with the warning that we issued last autumn (see A Curious Case of Core Weakness, Sep 6, 2012), the Netherlands should remain the weakest core economy this year, shrinking by 0.8%. The outlook for next year crucially depends on whether the government goes ahead with budget cuts amounting to about 0.7% of GDP. Our below consensus 2014 forecast of 0.5% assumes that a material fiscal tightening will be needed to bring the budget deficit back in line with the 3% EDP commitment. Elga Bartsch
Sunday Start: What Next in the Global Economy (APRIL 28, 2013): I'm usually eager to come home from a long trip overseas, but this time is different. When my plane landed in cold, rainy weather yesterday, I felt like taking the next flight back to warm and sunny LA where I had boarded on Friday afternoon. It was an interesting ten days in the US, starting out in Washington at our DC Macro conference and the IMF Spring Meetings, followed by client visits up the East Coast and then down the West Coast. Joachim W Fels
Japan Economics: J-Insight: The Third Arrow: Can Abenomics Maintain Momentum? The three arrows: Japan has successfully moved from "Discord to Accord" in monetary policy, the first arrow of Abenomics, as we predicted in our report of November 8, 2012. Japan has also become more aggressive on fiscal policy, the second arrow. The third arrow, microeconomic reforms, is now the focus of attention. Success of third arrow policies will determine the sustainability of stock market gains, the weaker yen, and optimism about ending deflation and about fiscal reform. Robert Alan Feldman
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