David Cameron has told company bosses that firms should give their staff a pay rise. Certainly a raise in wages would be long overdue. The small average wage increase over the past year or so (1.8% between September and November 2014, compared with the same months a year earlier) has had no real impact on those at the bottom.
Credit Rating Agencies have been a lot in news ever since the US Subprime Mortgage Crisis 2007. Later, Europe blamed them for making matters worse for individual countries by downgrading Greece and Cyprus to ‘junk’ status. Over a period of time, over-reliance on ratings has been a cause of worry to many. The biggest players in the credit rating market are known as the Big Three: Standard & Poor’s, Moody’s and Fitch. They form a large share in the global credit rating market (roughly 95% in 2013)
Two government reports released on Thursday indicate the U.S. recovery might not be as strong as previously believed.
Retail sales fell 0.8% on a month-to-month basis in January, the United States Department of Commerce reported. On a year-over-year basis, January retail sales rose 3.3% compared to the same period in 2014, a disappointing increase. Economists expected much stronger growth in retail sales, as low activity a year ago provided an easy basis for growth in 2015.
Property in the United States is getting more expensive and demand for real estate is falling even when mortgage rates remain at record lows.
A flurry of indicators suggests that the real estate market in the U.S. is slowing due to steady price gains, while mortgage-refinancing activity is slowing, as interest rates have remained tightly range-bound in the past few years.
After the Federal Reserve releases its labor market conditions index today at 10am EST, a number of key economic indicators will be released that will measure economic developments in the United States and in Europe.
European lawmakers have recently disagreed on how the European Central Bank should move forward, in light of disinflationary trends that have caused both negative bond yields and deflation throughout central and northern Europe.
The U.S. has a larger trade deficit with the rest of the world, but employment gains indicate strength in services is supporting the broader economy.
The Bureau of Economic Analysis announced Thursday that the United States has a trade deficit of $46.6 billion as of December 2014, up 17% from the prior month.
Three separate reports indicate that U.S. income and spending in the consumer services and financial sector are on the rise, helping job growth and business income.
The Institute for Supply Management reported Wednesday that the non-manufacturing sector rose more than expected, with activity as measured by the Non-Manufacturing index up to 56.7 in January, 0.2 points higher than December’s reading and slightly above forecasts.
Residential real estate continues to recover at a strong pace in the United States, but U.S. factories are beginning to see a fall in demand.
A new report by CoreLogic shows that home prices rose 5% on a year-over-year basis in December 2014, with only three states—Maryland, Vermont, and Connecticut—seeing price declines. At the same time, Colorado, Texas, and New York were seeing the highest price gains.
The powerful bout of long dollar liquidation, spurred by optimism that the new Greek government had moved away from its posturing about debt forgiveness, has largely faded today. The ECB is reportedly rejecting Greece’s request to expand its T-bill offering to replace the formal assistance program that runs out at the end of the month.
The US dollar is mixed. It has recovered from an early spike to JPY116.65 in early Asia to test the JPY117.80 area. The euro briefly dipped below $1.1300 before Spanish and Italian PMIs surprised on the upside. Sterling bounced on a stronger PMI report but hit a wall of selling that pushed it back toward $1.50 before bids returned. The dollar-bloc is mixed.
