Weekly Economic Highlights
Week Ending August 17, 2024
Welcome back to MacroQuant Insights! This week, we’re diving into the most impactful economic events across the globe.
🔍 Takeaway
This week’s economic data shows slowing inflation in the US, mixed growth in developed markets, and persistent inflation in emerging markets.
United States: Inflation shows signs of easing, with core consumer prices moderating and retail sales rebounding strongly. However, building permits hit a four-year low, signaling potential weakness in the housing sector.
International: Japan's GDP growth surprises on the upside, driven by strong private consumption and business investment, while the UK experiences a decline in unemployment and a slight uptick in inflation. The Euro Area faces a downturn in economic sentiment, though GDP growth remains steady.
Emerging Markets: China’s industrial production slows, but retail sales pick up pace. South Korea's unemployment rate falls to its lowest level since October, reflecting a strong labor market.
⭐️ Post of the week
Source: Sébastien Page - LinkedIn
💼 Market Indicators
SPY Performance
Performance and Valuations by Region
Source: MSCI
Momentum performance by Style
Source: MSCI
S&P 500 Earnings Per Share
Source: Yardeni Research
🇺🇸 United States: Continuing Disinflation Signals and Strong Retail Sales
Inflation: The annual inflation rate slowed to 2.9% in July 2024, the lowest since March 2021, with core inflation at 3.2%. Energy costs rose slightly, while prices for new vehicles continued to decline.
Producer Prices: Factory gate prices rose by 0.1% MoM, driven by energy costs, while core producer prices remained unchanged, easing YoY to 2.4%.
Retail Sales: Surged by 1% MoM in July 2024, the largest increase since January 2023, led by motor vehicle sales and electronics.
Building Permits: Fell by 4% to a four-year low of 1.396 million, with significant declines in multi-unit permits.
🌐 International: Diverging Growth and Shifting Economic Sentiments
🇨🇦 Canada:
Building Permits: Dropped sharply by 13.9% MoM in June 2024, led by declines in both residential and non-residential sectors.
🇯🇵 Japan:
GDP Growth: Expanded by 0.8% QoQ in Q2 2024, driven by strong private consumption and business investment, marking the highest growth since Q1 2023.
Producer Prices: Increased by 3.0% YoY in July 2024, the highest in nearly a year, with significant rises in transport equipment and chemicals.
🇬🇧 United Kingdom:
Unemployment Rate: Fell to 4.2% in Q2 2024, with a notable decrease in the number of unemployed individuals.
Inflation: Edged up to 2.2% in July 2024, with rising prices for housing and household services.
🇪🇺 Euro Area:
Economic Sentiment: The ZEW Indicator plunged to a nine-month low of 17.9 in August 2024, reflecting ongoing uncertainty and deteriorating economic outlook.
GDP: Grew by 0.3% QoQ in Q2 2024, with Germany unexpectedly contracting by 0.1% amid industrial challenges.
🌏 Emerging Markets: Varied Economic Performance
🇨🇳 China:
Industrial Production: Grew by 5.1% YoY in July 2024, slowing from the previous month, with notable declines in manufacturing and utilities.
Retail Sales: Accelerated by 2.7% YoY, driven by strong growth in communication equipment and sports & recreation articles.
🇰🇷 Korea:
Unemployment Rate: Dropped to 2.5% in July 2024, the lowest since October, with a significant increase in the number of employed persons.
Stay tuned for next week's updates! Feel free to share your thoughts or questions below.