Quarterly Bulletin Q3 2013

More documents

Recommendations

Info

64 Developments in the International Quarterly Bulletin 03 / July 13 and Euro Area Economy cent during the fourth quarter of 2012. Final consumption expenditure and net exports of goods and services contributed 0.6 per cent and 0.4 per cent, respectively, to the increase in economic growth. The increase in exports is associated with the depreciation of the yen against its main trading partners. 9 8 7 6 Chart 10: BRIC GDP Growth Rates % Year-on-Year Change Sentiment data point to a further expansion in output during the second quarter of 2013. The manufacturing PMI increased from 51.1 in April to 52.3 in June. More forward-looking indicators point to further increases in economic activity during the second half of 2013. PMI new export orders remain above 50 and increased further during May. The OECD’s Composite Leading Indicator (CLI) – which is configured to identify turning points in economic activity 6 to 9 months ahead – has remained above 100 since November and this corresponds to above trend growth. Since the start of the year, the pace of increase in the CLI has intensified. The OECD’s Economic Outlook (May 2013) shows that projected GDP growth for 2013 has been revised upwards to 1.6 per cent (see Table 1) with a 1.4 per cent growth outlook for 2014. Expectations of fiscal expansion, further easing in financing conditions and an improvement in export performance in the latter half of this year underpin these projections. Since the start of the year deflationary pressures have intensified despite some easing during April. Inflation registered -0.7 per cent in April, up slightly from -0.9 per cent in March but still below the -0.3 per cent recorded during January. No changes to monetary policy were made by the Bank of Japan (BoJ) during May or June. One of the objectives of the new monetary policy strategy announced by the BoJ in April is to double the amount of base money in circulation within two years. Base money rose by 31.6 per cent year-on-year during May following a 23.1 per cent year-on-year expansion in April. BRIC Economies With the exception of Brazil, the BRIC economies are showing signs of a loss of growth momentum. Reflecting this, the IMF and OECD have revised downwards projected GDP growth during 2013. For the most part price pressures remain elevated. A consequence of this is that the scope for more accommodative monetary policy remains limited. 5 4 3 2 1 0 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 In China, annualised GDP growth slowed unexpectedly from 7.9 per cent in the fourth quarter of 2012 to 7.7 per cent during the first quarter of 2013, mainly owing to weaker investment. By contrast, private consumption accelerated and was the main driver of growth, while net trade also made a positive contribution. Sentiment data relating to the second quarter point to a further slowdown in economic activity. The manufacturing PMI, fell from 49.2 in May to 48.2 in June and this points to a further deterioration in business conditions for China’s manufacturing economy. The composite output PMI including services business activity fell from 50.8 in May to 49.8 in June. Total social financing, which is a broad measure of credit, fell by almost one third to 1.19 trillion yuan during May. Price pressures remain muted and inflation dropped from 2.4 per cent in April to 2.1 per cent in May, while the producer price index was negative for the fourteenth consecutive month in April. The most recent projections for GDP growth in 2013 and 2014 have been revised downwards by the IMF and the OECD owing to concerns about the sustainability of growth along with heightened risks in individual sectors. In Brazil, GDP increased by 1.8 per cent on an annualised basis during the first quarter of 2013, up from 1.4 per cent recorded during the fourth quarter of 2012. Inflation continues to rise and registered 6.5 per cent in mid-May which is at Q2 2012 2013 2012 2013 2012 2013 2012 2013 Brazil China India Russia Source: Thomson Reuters Datastream. Q3 Q4 Q1 Q2 Q3 Q4 Q1
Developments in the International and Euro Area Economy Quarterly Bulletin 03 / July 13 65 the higher end of the central bank’s target of 4.5 per cent plus or minus 2 percentage points. The central bank’s main policy rate, the Selic, was increased by 25 basis points in April and by 50 basis points to 8.0 per cent in May. In India, GDP at factor cost increased by 4.8 per cent on a year-on-year basis during the first quarter of 2013, little changed from the 4.7 per cent increase recorded during the fourth quarter of 2012. Inflation, as measured on an annualised basis by the wholesale price index, dropped from close to 6 per cent in March to 4.9 per cent in April and coincided with a drop in fuel and power prices. The Reserve Bank of India cut its key policy rate by 25 basis points in March and again in May to 7.25 per cent. In Russia, activity continued to slow and according to the flash estimate GDP expanded by 1.6 per cent on an annualised basis during the first quarter of 2013, following growth of 2.1 per cent in the final quarter of 2012. Inflation remains high and increased from 7 per cent in March to 7.4 per cent in May, driven mostly by food prices. Box B: Comparing household saving patterns in the euro area periphery against those in the rest of the euro area By David Purdue 1 The euro area household savings rate (as a percentage of disposable income) has fallen below pre-crisis levels in recent years. Although the savings rate rose in the immediate aftermath of the financial crisis, it has subsequently fallen back to around 13 per cent, slightly below the average of 14.3 per cent for the euro area pre crisis. When we break down the euro area household savings rate into a periphery 2 and a rest of euro area component, it is clear that the fall in the periphery’s savings rate has weighed on the euro area aggregate in recent years (Chart 1) 3 . This box uses quarterly integrated euro area accounts data to compare the changes in volume and composition of household savings in the euro area periphery against the rest of the euro area. Box B Chart 1: Savings Rate 16 As Percentage of Disposable Income 15 14 13 12 11 10 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Euro Area Periphery Rest of Euro Area Source: ECB SDW Website. 1 Monetary Policy Division. 2 The periphery is defined as Ireland, Italy, Portugal and Spain. Relevant data for Greece are unavailable and are therefore included in the residual rest of the euro area. 3 The developments in the savings rate are caused primarily by developments in savings and not disposable income. Euro area savings (on a four quarter accumulated sum basis) rose by 15 per cent from Q1 2007 to Q4 2009 and have subsequently fallen back to Q1 2007 levels while disposable income increased by 6 per cent from 2007 to 2009, on a four quarter accumulated sum basis, and by a further 3 per cent from 2010 to 2012.
Page 1:
JULY 13 Q3 Central Bank Quarterly B
Page 5 and 6:
Contents Section 1 Forecast Summary
Page 7 and 8:
Section 1 Quarterly Bulletin 03 / J
Page 9 and 10:
7 Comment Annual National Accounts
Page 11 and 12:
9 The Domestic Economy Overview n A
Page 13 and 14:
The Domestic Economy Quarterly Bull
Page 15 and 16: The Domestic Economy Quarterly Bull
Page 33 and 34: 31 An Timpeallacht Gheilleagrach Le
Page 35 and 36: 33 Financing Developments in the Ir
Page 37 and 38: Financing Developments in the Irish
Page 55 and 56: 53 Developments in the Internationa
Page 57 and 58: Developments in the International a
Page 65: Developments in the International a
Page 73 and 74: 71 EU-IMF Financial Assistance Prog
Page 75 and 76: EU-IMF Financial Assistance Program
Page 77 and 78: EU-IMF Financial Assistance Program
Page 79 and 80: 77 Developments in EU Financial Ser
Page 81 and 82: Developments in EU Financial Servic
Page 83 and 84: Developments in EU Financial Servic
Page 85 and 86: Section 2 Quarterly Bulletin 03 / J
Page 87 and 88: Analysis of Recent Monetary Operati
Page 105 and 106: Section 3 Quarterly Bulletin 03 / J
Page 107 and 108: Statistical Appendix Quarterly Bull
Page 117 and 118:
Statistical Appendix Quarterly Bull
Page 119 and 120:
Page 121 and 122:
Page 123 and 124:
Page 125 and 126:
Page 127 and 128:
Page 129 and 130:
Page 131 and 132:
Page 133 and 134:
Page 135 and 136:
Page 137 and 138:
Page 139 and 140:
Page 141 and 142:
Page 143 and 144:
Page 145 and 146:
Page 147 and 148:
Page 149 and 150:
Page 151 and 152:
Page 153 and 154:
Page 155 and 156:
Page 157 and 158:
Page 159 and 160:
Page 161 and 162:
Page 163:
show all

Quarterly Bulletin Q3 2013

Create successful ePaper yourself

Delete template?

Save as template?