Pictorial representation of the US Quantitative Easing program

The US FOMC announced further quantitative easing activity today; it's going to sell about $400B of treasuries with maturities less than 3 years, and buy about $400B securities with maturities greater than 6 years. This will push down long term rates at the expense of short term rates. Economically it may impact on investment decisions at the margin, but the success of the program remains to be seen.

For your convenience a pictorial representation of the Fed's quantitative easing program to date is included below:

Top 5 Economics Graphs of the Week - 14 May 2011

This week we look at Euro Zone GDP and break out the economic growth results from Germany and France, and gauge how the Euro economies are progressing through the recovery. We also have a brief review of the inflation data from the US, and wrap up with a review of 12 monetary policy decisions of various central banks from around the world over the past week.

1. EU GDP
The euro area (EA17) reported Q1 GDP growth of 0.8% q/q, up from 0.3% in Q4 2010, bringing annual GDP growth to 2.5%, up from 2.0% in Q4 2010. Meanwhile the EU27 also recorded quarterly GDP growth of 0.8%, up from 0.2% in Q4 2010, bringing annual growth to 2.5%, up from 2.2% in Q4 last year. The worst performing economies on a quarterly basis were Portugal (-0.7%), Cyprus (0%), Italy (0.2%) and Latvia (0.2%). While the best performing economies on a quarterly basis were Lithuania (3.5%), Estonia (2.1%), and Germany (1.5%), with 1% growth rates in Belgium, France, Austria, and Slovakia. Thus for now, growth is relatively strong in the Euro region, in spite of the fiscal challenges on the fringe, but there are risks to the outlook.

2. German GDP
Germany reported Q1 GDP growth of 1.5% q/q, up from 0.4% in Q4 2010 (market consensus around 0.9%). On an annual basis the German economy expanded 4.8%, faster than the 3.8% recorded in Q4 last year (market consensus around 4.2%). Germany continues to prove its worth as a key growth engine in the EU, benefiting from a strong manufacturing and export base, as well as a sound financial system and strong government balances. Philipp Rosler, economics minister in Germany, said "Germany is the growth motor among the industrial nations - and not just in Europe".

3. France GDP
The French economy grew 1.0% in the first quarter of this year, faster than the 0.3% recorded in the previous quarter. On an annual basis GDP expanded 2.2%, up from 1.4% in Q4 2010. The French economy is slowly gathering pace, with the manufacturing and services sectors strong, yet much of the growth this quarter came from changes in inventories. Household spending and fixed capital formation also contributed positively, while net exports were a negative. French finance minister Christine Lagarde noted that Q2 GDP is likely to be weaker, but is still comfortable with a 2.0% growth target for 2011.

4. US Inflation
The US reported annual headline inflation of 3.2% in April, up from 2.7% in March as the CPI rose 0.4% m/m. Core inflation crept up to 1.3% in April from 1.2% the previous month, with core CPI up 0.2% m/m. Accelerating nflation around the world at the moment is larely a product of rising commodity prices - especially energy commodities. In the near term there may be some more moderation in commodities prices, but I don't see oil falling far and fast in the near term. What was a mild concern was the incidence of broader 'second round' inflation effects, with core inflation steadily rising. That said, while both headline and core inflation are rising, neither are accelerating at a historically excessive rate, core is still relatively low compared to the last 10 years.

5. Monetary Policy Review
The past week saw 12 monetary policy decisions. Those that increased interest rates were: Azerbaijan +25bps to 5.25% Poland +25bps to 4.25% Norway +25bps to 2.25% Peru +25bps to 4.25% and Chile +50bps to 5.00%. Meanwhile Ghana was the only country that eased policy, cutting rates 50bps to 13.00%. Those that held rates unchanged were: Indonesia 6.75% South Africa 5.50% Latvia 3.50% and South Korea 3.00%. Besides interest rate changes two economies lifted reserve requirements: Uruguay lifted its required reserve ratios 300bps to 15%, while China increase its RRR by 50 basis points to an average 21% for large banks.

Summary

A look at euro region GDP results showed the economic recovery is still strongly on track for the most part, but with due divergence and weakness at the periphery. While there remains downside risks to the outlook from economies like Portugal, Ireland and Greece, the outlook is still strong with the key economies like France, and especially Germany growing strongly. Elsewhere, the US saw an acceleration of inflation in April, but not yet at a worrying pace. On the monetary policy front the theme of emerging market tightening continued, and saw increasing involvement of developed economies in the monetary policy normalization process.

Sources:
1. EuroStat epp.eurostat.ec.europa.eu
2. EuroStat epp.eurostat.ec.europa.eu
3. EuroStat epp.eurostat.ec.europa.eu
4. Bureau of Labour Statistics www.bls.gov
5. CentralBankNews.info www.centralbanknews.info

Article Source: http://www.econgrapher.com/top5graphs14may11.html

U.S. PMI Results Should Comfort Investors Who Are Long U.S. Equities

The U.S. impressed once again with its manufacturing Purchasing Managers Index results. The main PMI index crept up a further 0.6 to 61.4, the highest level since the early 1980's. New orders added 0.2 to 68.0 and the employment sub-index added 2.8 to 64.5 as more employers signaled higher staff (a net 26% expect higher employment).

http://seekingalpha.com/article/255921-u-s-pmi-results-should-comfort-investors-who-are-long-u-s-equities

Economic Calendar - 26 December 2010

Here's the Economic Calendar for the week commencing the 26th of December 2010. As we enter the last market week of 2010 there's only a handful of economic events this week. No doubt the interest rate increase in China will play a part in how the following week turns out. The main events this week will be Japan data (jobless rate, CPI, industrial production, and retail trade), and US data ( consumer confidence, and the S&P/Case-Shiller house price report), and China data (industrial profits and leading index).

(More commentary follows the table)

Date	GMT	Country/ Currency	Event	Forecast	Previous
SUN	23:50	JPY	BOJ Minutes of Oct. 28 & Nov. 4-5 Meetings		-1.20%
SUN	02:00	CNY	Industrial Profits YTD YoY (NOV)		55.00%
MON	05:00	JPY	Housing Starts (YoY) (NOV)	4.90%	6.40%
MON	05:00	JPY	Annualized Housing Starts (NOV)	0.831M	0.831M
MON	23:30	JPY	Job-To-Applicant Ratio (NOV)	0.57	0.56
MON	23:30	JPY	Jobless Rate (NOV)	5.10%	5.10%
MON	23:30	JPY	National Consumer Price Index (YoY) (NOV)	0.10%	0.20%
MON	23:30	JPY	National CPI Ex-Fresh Food (YoY) (NOV)	-0.60%	-0.60%
MON	23:30	JPY	National CPI Ex Food, Energy (YoY) (NOV)	-0.80%	-0.80%
MON	23:50	JPY	Industrial Production (MoM) (NOV P)	0.90%	-2.00%
MON	23:50	JPY	Retail Trade s.a. (MoM) (NOV)	1.10%	-1.90%
MON	23:50	JPY	Industrial Production (YoY) (NOV P)	5.50%	4.30%
MON	23:50	JPY	Retail Trade (YoY) (NOV)	0.40%	-0.20%
TUE	06:30	EUR	French Gross Domestic Product (QoQ) (3Q F)	0.40%	0.40%
TUE	06:30	EUR	French Gross Domestic Product (YoY) (3Q F)	1.80%	1.80%
TUE	14:00	USD	S&P/Case-Shiller Home Price Index (OCT)		147.49
TUE	14:00	USD	S&P/Case-Shiller 20 City (MoM) SA (OCT)	-0.60%	-0.80%
TUE	14:00	USD	S&P/Case-Shiller Composite-20 (YoY) (OCT)	-0.18%	0.59%
TUE	15:00	USD	Consumer Confidence (DEC)	56.30	54.10
WED	05:00	EUR	German Consumer Price Index (YoY) (DEC P)	1.50%	1.50%
WED	05:00	CNY	Leading Index (NOV)		101.57
THU	05:00	JPY	Nomura/JMMA Manufacturing PMI		47.30
THU	13:30	USD	Initial Jobless Claims (DEC 25)	415K	420K
THU	13:30	USD	Continuing Claims (DEC 18)	4100K	4064K
FRI	05:00	GBP	Nationwide House Prices n.s.a. (YoY) (DEC)	-0.30%	0.40%

As noted Japan has a few data points out this week, including Bank of Japan monetary policy meeting minutes, housing starts, employment data (expect little change), CPI (also expect little change), industrial production (expect a slight improvement), and retail sales (also expect a slight improvement). Over in the US the key events are consumer confidence (expecting a slight improvement), and the S&P/Case-Shiller housing price report (expect further deterioration). That's all for now in this holiday season trimmed down version of the economic calendar, have a good last trading week of 2010, and a great festive season!

And as always, have a great week, watch out for surprises, and stay tuned for updates...

Sources
DailyFX www.dailyfx.com/calendar
Forex Pros www.forexpros.com/economic-calendar/
Forex Factory www.forexfactory.com/calendar.php
Bloomberg www.bloomberg.com
+various statistics websites and central bank websites for verification

Article Source: http://www.econgrapher.com/26dec-calendar.html

Top 5 Economics Graphs of the Week - 4 December 2010

This week we look at the US PMI results; while also reviewing the China PMI data for November. Then we check out the 3rd quarter GDP results for Australia, before wrapping up with a closer look at some US data on the housing market, consumer confidence, and the nonfarm payrolls report.

1. US PMI
The US manufacturing PMI came in at 56.6, a little below consensus 57 and previous 56.9, the non-manufacturing PMI matched consensus at 55.0, and increased vs October's 54.3 reading. So between manufacturing and services there was a bit of variation, also within the results the manufacturing sub-components were not great e.g. falls in new orders, production, employment, exports. But within the services sub-indices there was a bit more positives e.g. rises in new orders, new export orders, employment, etc. So overall the results are generally positive, and not really surprising given where the US economy is at.

2. China PMI
Over to China, the official PMI rose to 55.2 from 54.7 in October; beyond expectations for 54.8. The HSBC Markit index rose to an 8 month high of 55.3 from 54.8 in October. The standouts in the sub-indices were Production (58.5 vs 57.1), Supplier Delivery (48.9 vs 49.3), New Orders was basically flat, but still strong (58.3 vs 58.2), similarly Employees was little changed (52.0 vs 52.1). In general its good to see the index rising, its also positive to see it still in the expansionary zone, and it will give comfort to those watching China's attempt at a managed slowdown as inflation pressures rise.

3. Australia GDP
The Australian economy grew 0.20% q/q in the September quarter, placing Australian GDP up 2.7% year on year. The pace of growth was slower than the expected 0.40% q/q growth, as global volatility, exchange rate pressures on exports, and withdrawal of fiscal stimulus measures took their toll on the Australian economy. Looking forward though the pace of growth is likely to rebound in 2011 as the resources sector surges ahead with a number of large scale mining projects in the pipeline, and farming continues to contribute; and of course the flow on effects to the rest of the economy.

4. US House Prices and Confidence
Two key pieces of data release last week were the Case-Shiller house price index, which showed house prices falling further (no surprise). The other key data point was the Conference Board Consumer Confidence index, which showed a jump to 54.1 (vs consensus 52, previous 50.2). Within the confidence numbers, the present situation index rose to 24 from 23.5 and the expectations index jumped to 74.2 from 67.5 previously. So people are feeling a little better about the future, but just not so much about the here and now. And looking to the housing market, the future may be better, but the short-medium term probably has further downside risk unless the fundamentals sharply turnaround.

5. US Nonfarm Payrolls
The US added 39k nonfarm payrolls in November, vs 151k in October, and well below consensus 168k. Private payrolls were up 50k vs 159k in October. Average hourly earnings were flat, as was the average work week. So overall not a great result, good that it was positive, but basically it lines up with the idea that the US recovery is not going to be linear, and basically that there is going to be choppiness as the US economy muddles through the next year or two.

Summary

So we saw the manufacturing PMI in the US still strong, but with some negatives in the sub-components, the services PMI however was a bit stronger and relatively more promising. Meanwhile in China the manufacturing PMI improved, showing that the concern is rightfully more about the risks of overheating rather than not growing. In Australia, the economy continued to grow, but a little less so as stimulus wore off, but expect the slowdown to be temporary. Back to the US, the housing market is still under the gun, but the consumer is slowly feeling a bit better about the future, in spite of the job market also remaining relatively subdued.

Sources
1. Institute for Supply Management www.ism.ws & Yahoo Finance finance.yahoo.com
2. CFLP www.chinawuliu.com.cn & Markit/HSBC www.markiteconomics.com & National Bureau of Statistics www.stats.gov.cn
3. Australian Bureau of Statistics www.abs.gov.au
4. Conference Board www.conference-board.org & Standard & Poors www.standardandpoors.com
5. Bureau of Labour Statistics www.bls.gov

Article Source: http://www.econgrapher.com/top5graphs-4dec.html

US & China PMI Review

Both China and the US released their November PMI stats in the past few days, showing relatively strong vitals in both of their manufacturing sectors. Looking first at China, the official PMI rose to 55.2 from 54.7 in October; beyond expectations for 54.8. The HSBC Markit index rose to an 8 month high of 55.3 from 54.8 in October. The standouts in the sub-indices were Production (58.5 vs 57.1), Supplier Delivery (48.9 vs 49.3), New Orders was basically flat, but still strong (58.3 vs 58.2), similarly Employees was little changed (52.0 vs 52.1).


So overall a relatively strong result from China, new orders are still going strong, production activity is picking up, which is all a positive sign given the moves the authorities have taken to tackle inflation and perhaps engineer some sort of soft landing. It's a good sign, because it shows there is still solid fundamental strength in the Chinese economy, i.e. that it can withstand a bit of a slowing.

Meanwhile in the US, the ISM PMI reduced slightly to 56.6 from 56.9, and slightly below consensus 57. But again, the figure is comfortably above the 50 point mark, indicating relatively robust expansion. Looking at the detail however, much of the changes were particularly impressive, production fell off quite a bit, new orders fell, exports fell, and employment was basically flat. So we're in the right space for now, but if this sort of pattern repeats, it will be back to square one for the manufacturing sector.


So the takeaway is that the current state of the US and Chinese manufacturing sectors is relatively positive. China probably more so, and the direction is also probably more promising, and it lines up with the view that China's economy still has a decent amount of wind left in it. The US meanwhile is showing strength, but the wobbles are also showing through - there will be strength but as noted before, the US is in the muddle ages of the recovery, so it's almost certain to be a nonlinear progression.

Sources
Econ Grapher Analytics www.econgrapher.com
CFLP www.chinawuliu.com.cn
Markit/HSBC www.markiteconomics.com
Yahoo Finance finance.yahoo.com
Institute for Supply Management www.ism.ws

Article Source: http://www.econgrapher.com/2dec-uschinapmi.html

Top 5 Economics Graphs of the Week - 27 November 2010

This week we review the Q3 GDP revisions from the US and UK, then we look at the October CPI data from Canada and Japan, before finishing with a summary of a selection of emerging market monetary policy decisions over the past week.

1. US Q3 GDP Revision
US Q3 GDP was revised up to a 2.5% seasonally adjusted annualised rate, from the previous estimate of 2.0%, this was ahead of expectations for 2.4%. Within the results final demand was revised up, and net exports made a smaller negative contribution. Year on year GDP is up 3.2% vs 3.0% in the September quarter. Overall the result is relatively strong, showing a continuation of the bounce back, and it could well gain momentum, but the more likely outcome is ups and downs over the next year.

2. UK Q3 GDP Revision
UK GDP expanded 0.8% from the June quarter, in line with previous data, and placing the UK economy ahead by 2.8% compared to 2009. In the detail the stronger sectors were construction, manufacturing, exports, and transport, storage and communication services. While the weaker sectors were mining and utilities. The UK economies continues to bumble along out of recession, but it is quite promising that exports are expanding, the test will be how the UK government can manage its budget and how monetary policy plays out from here.

3. Japan Consumer Price Index
Japan saw its first positive year on year inflation rate in October, with CPI increasing 0.2% year on year, vs -0.6% in September. But it can't really be said that deflation is done, as much of the increase in the CPI was related to an increase in tobacco taxes. But it will be a welcome result to the Bank of Japan, which has been trying and trying to stimulate the economy and start inflation going again, instead of the persistent and pernicious deflation.

4. Canada Consumer Price Index
Canada saw a bit of a jump in inflation in October, with the CPI increasing 2.4% year on year vs 1.9% in September. This has caused the market to anticipate further rate rises from the Bank of Canada, which last changed the key policy rate to 1.00% in September, as part of a gradual normalization of monetary policy. Canada in many ways has been relatively lucky in coming through the crisis, and is in some ways similar to Australia, with its rich natural resources.

5. Monetary Policy Review
The past week saw several emerging market economies review their monetary policy interest rate settings, including; Russia, Mexico, Georgia, Kenya, Poland, Nigeria, Angola, and Israel. The main standout was Angola, which slashed its benchmark rate -394 basis points to 18.00% as a new central bank governor took the helm. Nigeria and Israel also made adjustments to the spread between borrowing and lending around the main policy rate, as steps towards policy normalisation following the global recession. But basically the main theme was a lot of holding rates, with much of the justification being that rates were appropriate at current settings either due to inflation being contained or relatively high, and overall balancing the risks of growth and inflation.

Summary

So we saw GDP expanding in the US, and at a faster pace than expected, and with promising signs in the details. Meanwhile in the UK the results were also relatively positive. But for both nations the challenge for their economies will be to carry on the momentum of the initial bounce back - but in a sustainable manner.

On the inflation and monetary policy front, there were positive, but not fabulous results in Japan, as the first positive headline inflation figure came through in almost 2 years. While Canada saw an acceleration of inflation, and speculation of further rate hikes. On monetary policy, there was a few meetings over the week but very little action, as settings were seen appropriate in achieving the balance between growth risks and inflation risks.

Sources
1. US Bureau of Economic Analysis www.bea.gov
2. National Statistics Office www.statistics.gov.uk
3. Trading Economics www.tradingeconomics.com
4. Trading Economics www.tradingeconomics.com
5. Central Bank News www.centralbanknews.info

Article Source: http://www.econgrapher.com/top5graphs27nov.html

Top 5 Economics Graphs of the Week - 6 November 2010

This week we look at the PMI results for China and the US and reflect on their implications. Then we review the monetary policy decisions out over the past week including the announcement from the US FOMC. Then we wrap up with a look at the US employment figures for October, and the New Zealand employment stats for the September quarter.

1. China PMI
China saw a continued rebound in its manufacturing PMI figures for October, with the official CFLP figure rising to 54.7 from 53.8, and the the HSBC index rising to 54.8 from 52.9. Within the CFLP PMI index, the strong points were Production (57.1 vs 56.4), New orders (58.2 vs 56.3), and Inventory (49.5 vs 49.1), while the lower points were Employees (52.1 vs 52.4), and Supplier delivery (49.3 vs 50.4). So overall a reasonably good result, and reflects the continued strength in the Chinese economy - which is showing through into a higher stock market, with the SSE composite rising 15% in October.

2. US PMI
In the US, the October PMI result was also relatively positive with the main index rising to 56.9 from 54.4 driven by strength in new orders, production, and new export orders - with imports falling (a positive sign for net exports). While the non-manufacturing index also rose to 54.3 from 53.2, driven by strength in production, a large spike in prices, and back log of orders. So overall the October results for the US (unless there is some quirk to it) helps provide evidence or support for the non-double-dip scenario. So it is a positive, but at the same time the fundamentals are not quite there yet for economic growth to be anything more than subdued/baseline.

3. Monetary Policy Rates
In monetary policy the main event was the US FOMC announcing the $600 billion asset purchase program, to be implemented at a pace of $75 billion per month. The other major moves were tightening of monetary policy rates in Azerbaijan (100bps), Vietnam (100bps), Australia (25bps), and India (25bps), and loosening of monetary policy rates in Iceland (75bps), and Latvia (12.5bps). Meanwhile other banks held rates due to low inflationary pressures and a desire to keep stimulatory monetary policy conditions to aid the economic recovery e.g. US, EU, UK, Japan.

4. US Nonfarm payrolls
Back to the US, the October nonfarm payrolls pleasantly surprised to the upside, with 151k jobs added in October vs consensus 60k and previous -95k (revised to -41k). Private payrolls grew 159k in October vs 64k in September. Average hourly earnings crept up slightly 0.2% and the average work week was 34.3 hours vs 34.2 in September. So overall, as with the PMI results another good result for the US, a positive from the perspective that it's not going down, but there's still a long way to go before the ground lost during the crisis can be recovered.

5. NZ Employment situation
In New Zealand the Q3 employment report saw the unemployment rate dip to 6.4% from a revised 6.9% in the June quarter. Total persons employed grew by 22k, with part-time jobs increasing 12k and full-time jobs expanding 10k. Across the sectors the jobs growth was relatively broad based with most sectors adding jobs. The figure reflects the progress, albeit slow, being made in the New Zealand economic recovery, but the subdued nature is showing through with deleveraging playing through. One major challenge for New Zealand is the high exchange rate which will impact on net exports, but a key driver of that is weakness in the US dollar. In terms of monetary policy the RBNZ has likely finished tightenings for the year, but will likely continue early next year as the recovery unfolds.

Summary

So we saw relatively strong PMI results in China which showed the economy is still running strong in the middle kingdom. The US also showed strong results in its PMI stats, providing some comfort against the double-dip scenario, but not yet being able to offer more than a subdued, sub-trend economic growth outcome. In monetary policy the major banks are holding tight but other banks are acting as the case demands, with several emerging economies opting to tighten or normalise monetary policy as inflation risks trump growth risks. In employment, the US showed a strong result in October, and New Zealand also showed a pretty good result in Q3. So overall it's a scene of economic recovery, but all is not yet clear and well.

Sources:
1. CFLP www.chinawuliu.com.cn & Markit/HSBC www.markiteconomics.com & Yahoo Finance finance.yahoo.com
2. Yahoo Finance finance.yahoo.com & Institute for Supply Management www.ism.ws
3. CentralBankNews.info www.centralbanknews.info
4. US Bureau of Labor Statistics www.bls.gov
5. Statistics New Zealand www.stats.govt.nz

Article Source: http://www.econgrapher.com/top5graphs6nov.html

Top 5 Economics Graphs of the Week - 30 October 2010

This week we review the Q3 GDP results from the UK and US, then look at the recent data on the US housing market and consumer confidence. Then we examine some of the monetary policy decisions announced over the week, before wrapping up with a look at the inflation and employment situation in Japan.

1. US GDP
First up is US GDP which grew 0.4% q/q (or 2.0% "annualised" vs consensus 2.0%). On a year on year basis the US economy grew 3.1% vs 3.0% in Q2. Much of the gains were in inventory investment, consumer spending, equipment investment and government spending. So overall, the result was much as expected - relatively ho-hum, showing the US economy recovering - but at a subdued and muddled pace. So of course it's not plain sailing yet, a lot of the damage done during the financial crisis needs to be repaired, and a lot of the excesses need to be unwound before a true sustainable economic recovery can take place in the US.

2. UK GDP
over in the UK the growth rate was relatively strong at 0.8% q/q, which is a little lower than the 1.2% in Q2, but still respectable and enough to disappoint those that were hoping for another round of quantitative easing from the Bank of England. On an annual basis the British economy grew 2.8%, up from 1.7% in Q2. But as with the US, the all clear can't be signaled yet, and it is too soon to rule out further monetary policy stimulus - especially as the UK government seeks to reign in its budget deficit (maybe a bit of contracting on the fiscal and expanding on the monetary). So all the more reason to watch what happens next week!

3. US Consumer Confidence and Housing
Also out in the past week was the much watched Case Shiller House price report for August, which came in weaker on a monthly basis and slowed its increase on a yearly basis. So a disappointing result, but not a surprising result - there's no fundamental basis to expect a strong upsurge in the US housing market (and relatively small basis for sideways movement in prices). So of course it's also unsurprising to see still subdued results in the consumer confidence numbers, albeit with a small increase to 50.2 from 48.5 in September. At the margin the result was positive in that much of the increase was driven by an increase in the future expectations index, which is sensible.

4. Monetary Policy
In monetary policy there were no major events this week, the main items of interest were Denmark, and Sweden both increasing interest rates slightly - but signaling a slow move. The other interesting part was Japan, which expanded the scope of its asset purchase program and brought forward the next meeting date (to just after the Fed's meeting next week). On that note, the next week will be a very interesting week monetary policy-wise as the US FOMC, Bank of Japan, Bank of England, RBA, and ECB are all set to announce policy decisions. The main point of attention will be what the US Fed does in terms of QEII - will it go for a shock and awe campaign, or will it go for an incrementalist approach? Either way it almost seems a certainty now that the second quantitative easing campaign is about to commence.

5. Japan Inflation and Unemployment
In Japan, deflation remained persistent with the CPI falling -1.1% vs -1.0% in August, but the jobless rate slipped slightly to 5.0% vs 5.1% in August on the back of increasing payrolls. As pointed out, the Bank of Japan expanded the scope of its asset purchase program to include lower graded corporate bonds in effort to try and stimulate the economy and try and inject a semblance of inflation. Most remarkably though was the move to hold another meeting next week just after the Fed, which signals that the BOJ is ready to act if the US makes moves to devalue the US dollar. This would not be surprising as the Japanese economy is traditionally an export led economy, and with recent trade results faltering somewhat it may make for an interesting week indeed.

Summary

So we saw the US with relatively subdued growth in Q3, but growth nonetheless. But without showing major signs of strength has all but pave the way for a second campaign of quantitative easing by the US. Meanwhile the UK grew a little faster, and perhaps even blew the case for an extension of the asset purchase program by the Bank of England. We also saw a weakening US housing market and a US consumer stuck in limbo. On the monetary policy front most held, a couple increased, but the real monetary policy action will come next week. In Japan deflation remained, jobless declined slightly, and the BoJ lined itself up to counter any possible dollar devaluing determinations from the Fed next week.

Sources:
1. Bureau of Economic Analysis www.bea.gov
2. UK National Statistics www.statistics.gov.uk
3. Conference Board www.conference-board.org & Standard & Poors www.standardandpoors.com
4. CentralBankNews.info www.centralbanknews.info
5. Trading Economics www.tradingeconomics.com

Article Source: http://www.econgrapher.com/top5graphs-30oct.html

Economic Calendar - Week Starting 25 October 2010

Here's the Economic Calendar for the week commencing the 25th of October 2010. This week the main event is the US Q3 GDP report on Friday, the UK will also release its Q3 GDP data this week. In monetary policy New Zealand and Japan are both due to announce interest rate decisions this week. Japan also has a swath of key monthly data out such as employment, inflation, industrial production, and trade data. The US will also see its much Case-Shiller house price report, and consumer confidence numbers released this week.

(More commentary follows the table)

Day	Time (GMT)	Code	Event/Release	Forecast	Previous
SUN	23:50	JPY	Merchandise Trade Exports (YoY) (SEP)	9.6	15.5
SUN	23:50	JPY	Merchandise Trade Imports (YoY) (SEP)	7.4	17.9
SUN	23:50	JPY	Merchandise Trade Balance Total (SEP)	¥710.0B	¥86.0B
MON	09:00	EUR	EU Industrial New Orders (MoM) (AUG)	2.4%	-1.8%
MON	14:00	USD	Existing Home Sales (SEP)	4.30M	4.13M
MON	14:00	USD	Existing Home Sales (MoM) (SEP)	4.1%	7.6%
TUE	08:30	GBP	Gross Domestic Product (QoQ) (3Q A)	0.4%	1.2%
TUE	08:30	GBP	Gross Domestic Product (YoY) (3Q) A	2.4%	1.7%
TUE	13:00	USD	S&P/Case-Shiller Home Price Index (AUG)		148.91
TUE	13:00	USD	S&P/Case Shiller 20 City (MoM) SA (AUG)	-0.20%	-0.13%
TUE	13:00	USD	S&P/Case-Shiller Composite-20 (YoY) (AUG)	2.20%	3.18%
TUE	14:00	USD	Consumer Confidence (OCT)	49.5	48.5
TUE	21:00	USD	ABC Consumer Confidence (OCT 24)
TUE		EUR	German CPI (YoY) (OCT P)	1.3%	1.3%
TUE	00:30	AUD	Consumer Prices Index (YoY) (3Q)	2.9%	3.1%
WED	12:30	USD	Durable Goods Orders (SEP)	2.0%	-1.5%
WED	14:00	USD	New Home Sales (SEP)	300K	288K
WED	14:00	USD	New Home Sales (MoM) (SEP)	4.2%	0.0%
WED	20:00	NZD	RBNZ Rate Decision (OCT)	3.00%	3.00%
WED		JPY	Bank of Japan Rate Decision (OCT 28)	0.10%	0.10%
THU	04:00	CNY	Leading Index (SEP)		101.91
THU	07:55	EUR	German Unemployment Change (OCT)	-30K	-40K
THU	12:30	USD	Initial Jobless Claims (OCT 23)	455K	452K
THU	12:30	USD	Continuing Claims (OCT 16)	4430K	4441K
THU	21:45	NZD	Exports (New Zealand dollars) (SEP)		3.15B
THU	21:45	NZD	Imports (New Zealand dollars) (SEP)		3.59B
THU	23:15	JPY	Nomura/JMMA Manufacturing PPMI (OCT)		49.5
THU	23:30	JPY	National Consumer Price Index (YoY) (SEP)	-0.6%
THU	23:30	JPY	Jobless Rate (SEP)	5.1%	5.1%
THU	23:30	JPY	National CPI Ex Food, Energy (YoY) (SEP)	-1.5%
THU	23:50	JPY	Industrial Production (MoM) (SEP P)	-0.6%	-0.5%
THU	23:50	JPY	Industrial Production (YoY) (SEP P)	12.3%
THU		CNY	MNI Business Condition Survey (OCT)		69.54
FRI	09:00	EUR	Euro-Zone Unemployment Rate (SEP)	10.1%	10.1%
FRI	12:30	CAD	Gross Domestic Product (MoM) (AUG)	0.3%	-0.1%
FRI	12:30	USD	Gross Domestic Product (Annualized) (3Q A)	2.2%	1.7%
FRI	13:55	USD	U. of Michigan Confidence (OCT F)	68.0	67.9

As noted the key report this week is the US Q3 GDP figures, which will provide a timely insight into where the US economy is at - of course as always its not so much the quantum that matters as much as the breakdown. In other words where is the growth coming from? and what are the flow on effects? In any case the forecasts are for around 2-3%, and will likely slow in the 4th quarter. The UK is also on the GDP radar this week, with expectations for a slower 0.4% q/q rate (compared to 1.2% in Q2), and is likely to only slow further as the UK comes to grips with some of the key challenges it's currently facing.

On the monetary policy front there's the RBNZ in New Zealand, which is likely to hold at 3.00%, as the governor recently signaled rates would likely be on hold until next year (having tightened from 2.50% this year). The bank of Japan has already reached the limit in terms of interest rates, but could come out with further quantitative easing plans in efforts to stimulate the economy and get inflation going.

Speaking of Japan, there's the usual consumer price index data due this week (expected to show continued deep deflation), and employment data (little change expected), and industrial production (a slight decrease), and trade data (also expecting a slower rate of expansion). So combined with potential policy action from the Bank of Japan, the data will give a good insight into where the Japanese economy is headed. Oh and its neighbor has a leading index report out this week too.

Back to the US, the other key data this week is the ever critical housing report; S&P Case-Shiller home price indexes (as well as the existing and new home sales reports), so it will be good to check in on the US housing market. There's also the consumer confidence indexes due out (conference board, and University of Michigan). But of course waiting for positive changes in these data sets is currently like watching paint dry - but do search for insights in the details nonetheless.

So as always, have a great week, watch out for surprises, and stay tuned for updates...

Sources
DailyFX www.dailyfx.com/calendar
Forex Pros www.forexpros.com/economic-calendar/
Forex Factory www.forexfactory.com/calendar.php
Bloomberg www.bloomberg.com
+various statistics websites and central bank websites for verification

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