Eurozone private sector activity rebounded strongly in February. Eurozone private sector business activity rose at the fastest pace in nine months in February, raising the possibility that the currency bloc can avoid a downturn this quarter. The S&P Global eurozone composite Purchasing Mangers’ Index (PMI), which includes both manufacturing and services activity, came in at 50.2 in January, up from 49.3 in December and beating a consensus forecast of 49.8. Readings above 50 indicate expansion in the sector. The survey also indicates improving demand, which is considered as surprising given the high inflation and the downturn in domestic demand in the fourth quarter in larger eurozone economies.
Fed minutes show most officials favoured quarter-point rate hike. The minutes of the US Federal Reserve’s (Fed) latest monetary policy meeting, which ended on February 1, showed that almost all policymakers backed the decision to raise the benchmark interest rate by a quarter of a percentage point, whilst only a few preferred a half-point increase. Fed officials are indicating that a resilient American economy could lead them to raise interest rates somewhat higher than they had anticipated, determined to tame high inflation. The minutes noted that all participants continued to anticipate that ongoing rate increases would be needed to achieve the Fed's dual objectives of maximum employment and inflation at the rate of two percent over the longer run.
UK property asking prices show weakest February gain on record. Average asking prices for residential properties in the UK rose by just 14 pounds (16 euro) in February from January. That is the smallest rise on record for a month which usually experiences a big seasonal increase, data from property website Rightmove showed on Monday. The online property portal isn’t the only real estate company observing a slowdown in the market. The Royal Institute of Chartered Surveyors recently said that British home buyer demand is currently at its weakest since 2009. Rightmove said that though the reading was low, it "could be seen as a positive indicator for the year ahead". There were concerns that house prices would plumet as a result of interest rate hikes, with this reading showing otherwise.
Italy’s inflation eases in December. The Italian consumer saw a considerable easing in inflation at the start of the year, owing primarily to a sharp drop in the prices of regulated energy goods. Italy’s EU-harmonised consumer prices (HICP) fell by 1.5percent month-on-month in January and were up by 10.7 percent year on year, official statistics agency ISTAT said on Wednesday, revising down preliminary data. The preliminary estimate had pointed to -1.3 percent month-on-month and +10.9 percent year-on-year. January's annual rate was down from +12.3 percent in December.
Australia Westpac leading index signals weak growth. Australia's leading index continued to show that the continent’s economy is still growing below-trend in the first half of the year mostly led by weaker consumer spending, Westpac said on Wednesday. The six-month annualised growth rate in the Westpac-Melbourne Institute Leading Index, which indicates the likely rate of economic activity relative to trend three to nine months into the future, was -1.04 percent in January, very slightly better than the -1.09 percent print in December. Westpac added that growth would remain below trend through most of 2023, with global factors, high interest rates and, recently, hours worked have weighed heavily on the Index.
In case of any queries, please email us on [email protected] or call on 2275 3857.