The Macro Sweep

November 7, 2013 2:44 pm

South African output, Taiwan trade

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A weak performance in South African manufacturing indicates that the problems from industrial action are not likely to disappear any time soon. Weak numbers also came out of Taiwan, but Australia seems to have turned a corner after months of bad data.


Chile: The trade balance rose to $241m from a deficit of $220m in September. Copper exports rose to $3.89bn from $3.35bn.

Brazil: The IPCA consumer price index rose 0.57 per cent month on month in October, pushing year-on-year inflation up to 5.84 per cent. The monthly rise came from a 1.03 per cent increase in food prices and a 1.13 per cent rise in clothing costs.


South Africa: Manufacturing output dropped 3.3 per cent year on year in September, after weak growth of 0.2 per cent in August. After a 25 per cent fall in August, the production of vehicles, parts and accessories plunged 49.7 per cent year on year – the effect of strikes at BMW, Toyota and Volkswagen.

This is the strongest pace of decline seen in 18 months. Analysts at 4Cast were pessimistic about the outlook: “We are cautious to expect larger improvements in the pace of growth by the end of the year as the midterm outlook remains clouded by the persistent industrial action.”

Mining production increased 0.6 per cent year-on-year in September, with the highest growth seen in copper production, which was up 187.4 per cent.

The country’s gross reserves edged down to $49.7bn at the end of October from $50bn a month before. The central bank said that the decrease came mainly from foreign exchange payments made on behalf of the government. The gold reserves declined due to the decrease in the US dollar gold price. Net reserves slipped down to $45.77bn from $45.8bn.

Asia Pacific

Taiwan: Both imports and exports were weaker than expected in October. After a 7 per cent year-on-year drop in September, exports contracted 1.5 per cent, pulled down by drops of 24.2 per cent in cement, 23.5 per cent in precision instruments and 14.3 per cent in footwear. Exports to Europe rose 6.7 per cent, but dropped 4.9 per cent to China and 3.1 per cent to Japan.

Imports contracted 2.8 per cent, despite expectations for some growth, leaving the trade balance at $3.52bn, up from $2.35bn last month.

Thailand: Consumer confidence continued to fall, dropping to 66.6 in October from 67.9.

Australia: The economy added about 1,100 jobs in October , compared with 3,300 in September. Full-time employment, however, slipped by 27,900 and part time employment rose 28,900. The unemployment rate remained steady, moving up only slightly to 5.8 per cent.

The performance of construction index returned to the expansionary zone, rising to 54.4 – its highest point since April 2010. Growth in activity was seen across all sectors and commercial construction recovered after 39 continuous months of contraction. The Australian Industry Group noted that while activity had strengthened, “the operating environment clearly remains tough for many businesses, with impediments such as tight credit conditions and a lack of public sector building works cited as the main constraints on activity”.


Norway: Manufacturing production fell 0.2 per cent month on month in September, although it remains 3.2 per cent higher than the same point last year. Industrial output rose 0.7 per cent month on month, but was 1.4 per cent lower year on year. The biggest year-on-year contraction was seen in electricity, gas and steam, which dropped 9.5 per cent.

Sweden: The budget balance dropped into a deficit of Skr7.4bn in October from a surplus of Skr28.3bn in September.

Netherlands: The harmonised index of consumer prices rose 1.3 per cent year on year in October, slowing from the 2.4 per cent in September.

Russia: The country’s gold and forex reserves slipped down to $514bn in the week ending November 1 from $517bn the week before, after the central bank started selling hard currencies.

Portugal: The unemployment rate edged down to 15.6 per cent in the third quarter from 16.4 per cent in the second.

Ireland: Consumer prices dropped 0.2 per cent month on month though inflation stands at 0.1 per cent year on year. The harmonised index of consumer prices dropped 0.2 per cent month on month and 0.1 per cent year on year.

Germany: Industrial output fell 0.9 per cent month on month, after increasing 1.6 per cent in August. It remains 1 per cent higher year on year.

Analysts at 4Cast noted that stronger than expected orders numbers bode well for the future and pointed out that manufacturers had been cautious about their payroll numbers in September because of subdued demand from emerging markets, according to September’s PMI.

Switzerland: The SECO measure of consumer confidence returned to minus 5 in the fourth quarter, after dropping to minus 9 in the third quarter. Views of the economic climate over the past 12 months improved, though concerns about unemployment remained high.

Spain: Industrial production expanded 3.5 per cent year on year in September, after a contraction of 4.2 per cent in August.

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