Economy Highlights

US - Manufacturing expands by most since 2004

Manufacturing in the US grew in February at the fastest pace in almost seven years, driven by gains in orders, employment and exports that signal factories will continue to propel the expansion. The Institute for Supply Management’s factory index increased to 61.4, exceeding the median forecast of economists surveyed by Bloomberg News and the highest level since May 2004. Readings greater than 50 signal growth. Compared with similar measures released in Europe and Asia, the data put the US at the forefront of the global manufacturing rebound. (Bloomberg)


US - Fed says labor market strengthened on manufacturing, retail

The Federal Reserve said the labor market improved throughout the country early this year, driven by increasing retail sales and “solid growth” in manufacturing. “Labor market conditions continued to strengthen modestly, with all Districts reporting some degree of improvement,” the Fed said. Its last survey, released 12 Jan, said the job market was “firming somewhat.” Overall, the economy “continued to expand at a modest to moderate pace,” the central bank said. (Bloomberg)


EU - Europe producer-price inflation quickens more than forecast

European producer-price inflation accelerated more than economists forecast in January, as soaring energy costs added to the European Central Bank’s concerns that inflationary pressures are building. Factory-gate prices in the euro region jumped 6.1% from a year earlier, after increasing 5.3% in December, the European Union’s statistics office said. That’s the fastest since September 2008 and above the 5.7% gain forecast by economists, according to the median of 16 estimates in a Bloomberg survey. January prices rose 1.5% from December. (Bloomberg)


EU - Spanish registered unemployment rises, deepening EU divide

Spain’s registered unemployment advanced for a second month in February, deepening the divide between peripheral economies struggling to recover from the financial crisis and Germany’s booming labor market. The number of people registering for jobless benefits in Spain rose by 68,260, or 1.6%, from January to 4.3 million, the Labor Ministry in Madrid said. Spain’s unemployment rate remains at more than 20%, while the number of Germans out of work dropped to the least since 1992 last month. Spain’s economy emerged from an almost two-year recession in 2010 before contracting again in the third quarter as austerity measures undermined the recovery. (Bloomberg)


Australia - Economy expanded by 0.7% last quarter before floods

Australia’s economic growth accelerated in the final three months of last year, the eighth straight quarterly expansion, before floods and cyclones this year ravaged the nation’s northeast. Gross domestic product advanced 0.7% from the third quarter, when it rose a revised 0.1%, the Bureau of Statistics said. That matched the median forecast in a Bloomberg News survey of 25 economists. The report validates Reserve Bank of Australia Governor Glenn Stevens’s view that natural disasters in the state of Queensland this quarter will be only a temporary drag on growth. (Bloomberg)