Final figures from the European Commission show that the index for consumer confidence in the eurozone increased to -6.6 in February 2020, compared to -8.1 in January 2020. The final figures are in line with expectations. In the same period, the index for economic sentiment rose from 102.6 to 103.5.
Based on a second estimate, the US government reports that the US economy grew by 2.1 percent on an annual basis in the fourth quarter of 2019. The figure corresponds to the initial estimate. The growth of 2.1 percent is equal to the growth on an annual basis in the third quarter of 2019.
New figures from Statistics Netherlands show that selling prices in the Dutch industry were 2.1 percent higher in January 2020 compared to January 2019. In December 2019, selling prices were 2.8 percent higher than a year earlier. Selling prices in the industry are strongly related to the price development of crude oil. Products in the petroleum industry were 7.6 percent higher in January 2020 compared to January 2019.
The 6M Euribor decreased with 1 basis point to -0.37% compared to previous business day. The 10Y Swap decreased with 1 basis point to -0.14% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
Statistics Netherlands has reported that producer confidence in the Netherlands has risen this month. The index that measures confidence increased from 2.5 in January 2020 to 3.7 in February 2020. As a result, producer confidence remains above the long-term average of 1.0. Producers were more positive about the expected activity and the order position.
Figures from the US Department of Commerce show that sales of new-built homes in the United States increased sharply in January. Sales increased by 7.9% on a monthly basis, to a level of 764,000 homes measured on an annual basis. Economists generally assumed a monthly increase of 3.5%.
The 6M Euribor is unchanged at -0.36% compared to previous business day. The 10Y Swap increased with 2 basis points to -0.13% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
The global steel production in January 2020 is 2.1% higher than in January 2019, according to figures from the World Steel Association. The 64 countries that are a member of the association had a combined production of 154.4 million tonnes of steel. The increase is mainly caused by the increase of production in China, which is responsible for more than half of the steel production. China increased its production in January 2020 by 7.2%, compared to January 2019.
The volume of world trade increased in December 2019 by 0.3 percent in comparison to November, according to figures from the Netherlands Bureau for Economic Policy Analysis (CPB). In November world trade decreased by 0.7 percent in comparison to October.
The US market researcher Conference Board announced that US consumer confidence in the economy increased in February. The confidence indicator recorded a level of 130.7 compared to a revised level of 130.4 in January. Economists expected a level of 132.1.
The 6M Euribor is unchanged at -0.36% compared to previous business day. The 10Y Swap decreased with 1 basis point to -0.15% compared to previous business day.
In the attachment, today’s market data on money and capital market rates as well as other rates are presented.
The International Monetary Fund (IMF) argues that the economic impact of the new coronavirus may not be as big as credit rating agency S&P Global recently predicted, although IMF Director Kristalina Georgieva stressed that the damage will be greater if the virus continues to spread. In a baseline scenario, IMF expects the Chinese economy to grow by 5.6% this year. The growth of the world economy would only decrease by 0.1%.
Figures from the German Federal Statistical Office show that in the last quarter of 2019 the German economy remained the same size as a quarter earlier. Economists also expected this outcome. In the third quarter, the economy increased by a revised 0.2%.
According to the research institute Ifo, German entrepreneurs’ confidence in the economy increased unexpectedly in February. Ifo’s confidence index stood at 96.1 in February compared to 96 in January. Economists expected a level of 95.3.
The 6M Euribor is unchanged at -0.36% compared to previous business day. The 10Y Swap decreased with 5 basis points to -0.14% compared to previous business day.
Markit stated that the activity in the industrial sector of the eurozone has decreased in February 2020. The purchasing managers index increased from 47.9 in January to 49.1 in February. Economists expected a value of 47.4. A value of 50 or above shows an increase in activity, below a decrease. The index for the service sector attained a value of 52.8 for February, compared to 52.5 in the previous month.
In addition, figures from Markit showed that the growth in the activity in de industrial sector of the United States has decreased. The purchasing managers index decreased from 51.9 in January to 50.8 in February. Economists expected a value of 51.5. The index for the service sector attained a value of 49.4, compared to 53.4 in January.
Based on final figures, Eurostat stated that the inflation in the eurozone was 1.4% in January on a year-on-year basis. The core inflation, without the volatile price of energy and food, decreased from 1.3% in January 2020 to 1.1%.
The 6M Euribor decreased with 1 basis point to -0.36% compared to previous business day. The 10Y Swap increased with 1 basis point to -0.09% compared to previous business day.
New figures from Statistics Netherlands show that unemployment in the Netherlands fell to 3.0% in January, compared to 3.2% in December. 3.0% is the lowest unemployment rate since Statistics Netherlands started reporting the current set of unemployment rates in 2003. A total of 64,000 new jobs were created in December and January, bringing the number of unemployed below 300,000 for the first time since the start of the current series in 2003.
The Japanese yen was set for its worst week in two-and-a-half years, but barely budged on Friday. However, in the previous two days the yen has lost 2% against the U.S. dollar. This loss is the result of continued worries in Asia about the coronavirus and weak Japanese economic data. Investors are therefore looking for safety in the U.S. dollar, gold and bonds.
Existing Dutch owner-occupied homes were 6.3% more expensive in January 2020 compared to one year before. The annual price increase is slightly lower than in December 2019, when the figure was 6.5%. The price index for owner-occupied homes reached the highest level ever in January 2020. Compared to the lowest point in June 2013, prices increased with more than 44%.
The 6M Euribor increased with 1 basis point to -0.35% compared to previous business day. The 10Y Swap decreased with 2 basis points to -0.10% compared to previous business day.
ING has announced that Ralph Hamers, CEO of the bank, will leave the bank on 30 June 2020. Hamers will start as chairman of the board at the Swiss bank UBS in September. In a press release, Hamers is praised for the digital transformation that the bank has undergone under his leadership. It is unknown who will succeed Hamers.
The minutes of the most recent policy meeting of the Federal Open Market Committee show that policy makers consider the current level of interest rates in the United States to be appropriate for the coming period. In addition, policy makers were more optimistic about the economic outlook than at the previous policy meeting. However, risks for further growth are closely monitored, with the corona virus being explicitly named. Finally, several policy makers discussed the possibility of restricting two purchase programs from the Fed, but there was no majority for this.
Statistics Netherlands has reported that consumer confidence in the Netherlands increased slightly in February 2020. The index that measures confidence rose from -3 in January to -2 this month. This means consumer confidence is still above the average for the past twenty years, which is at -5. The increase is mainly due to a more positive assessment of the economic climate. The willingness to buy remained constant compared to last month.
The 6M Euribor decreased with 1 basis point to -0.36% compared to previous business day. The 10Y Swap decreased with 1 basis point to -0.08% compared to previous business day.
Figures from research institute ZEW show that the confidence of German analysts and investors deteriorated significantly in February. The ZEW index reflects confidence for the next three to six months. The index fell from 26.7 in January to 8.7 for this month. On average, economists expected a level of 21.5. According to ZEW, economic development is currently “quite vulnerable” and the outlook for sectors focused on exports has decreased sharply.
Figures from branch organization for temporary workers ABU have shown that the demand for temporary workers in The Netherlands decreased in the first four weeks of 2020. In industry, the number of hours decreased by 9%, with 5% lower annual turnover. In the technical sector, the number of hours worked decreased by 21%, with 17% lower annual turnover. The administrative sector reported a 24% decrease in the number of hours, with 19% lower annual turnover.
In total, temporary employees made 15% fewer hours in the first weeks of 2020 than in the same period previous year. Turnover of temporary employment agencies decreased by 12%.
According to the ACEA car trade association, sales of new passenger cars in the European Union decreased in January. Sales decreased by 7.5% to almost 957,000 cars compared to 2019. In January, new passenger car sales decreased by 6% to 44,303 cars in January compared to 2019. In addition, in the major European car markets Germany, Italy, France and Spain sales declines were reported. As a reason for lower car sales, ACEA points to the weaker economy, uncertainty surrounding Britain’s departure from the EU, and changes in tax legislation in some EU member states.
The 6M Euribor increased with 1 basis point to -0.35% compared to previous business day. The 10Y Swap decreased with 2 basis points to -0.07% compared to previous business day.
The United States government considers new trade restrictions to prevent Chinese access to important computer technology. According to The Wall Street Journal, the US Commerce Department will draft amendments for the so-called foreign direct product rule, which restricts foreign companies’ use of US technology for military or national-security products. Chip factories outside the US will then require a license in order to use that technology.
The Chinese central bank lowered an important interest rate, which could signify the prelude of lower standard interest rates. The central bank announced that the interest rate on its medium-term lending facility will be reduced from 3.25% to 3.15%. The lower interest rate is an attempt to support the Chinese economy, which suffers from the coronavirus outbreak.
The production of the Japanese industry in December 2019 increased, but at a lower rate than initially expected. This was shown by final figures from the Japanese ministry of Commerce. The industrial production in Japan increased in December by 1.2% on a monthly base. Economists expected an increase of 1.3% on a monthly base.
The 6M Euribor is unchanged at -0.36% compared to previous business day. The 10Y Swap is unchanged at -0.05% compared to previous business day.
According to the European Statistical Office, Eurostat, the euro area economy increased by 0.1% in the fourth quarter compared to the previous quarter. Compared to a year earlier, the euro area economy increased by 0.9%. For the European Union, Eurostat reported a quarterly growth of 0.1% and 1.2% compared to a year earlier.
New figures provided by the Japanese authorities show that the Japanese economy contracted by 6.3% year-on-year in the fourth quarter of 2019. A tax hike caused a decline in business and consumer spending. The outlook for the economy is not very optimistic because of the outbreak of the coronavirus.
The United States is going to increase the import tax on European-built aircraft to 15% as of March 18th. At the moment, an import levy of 10% applies. The World Trade Organization (WTO) determined last year that Washington may impose USD 7.5 billion in punitive tariffs on European goods, because the EU continued to stop illegal subsidies according to the US Airbus.
The 6M Euribor is unchanged at -0.36% compared to previous business day. The 10Y Swap decreased with 1 basis point to -0.05% compared to previous business day.
Based on provisional figures from Statistics Netherlands, the Dutch economy grew by 0.4% in the fourth quarter of 2019 compared to a quarter earlier and in line with the previous three quarters. Growth in the fourth quarter was attributed to domestic consumption, investment and the trade balance. The growth rate for the full year 2019 was 1.7%.
Statistics Netherlands reported that the Dutch retail trade revenues increased with 3.4% in 2019 compared to 2018. The sales volume in 2019 was approximately 2.5% higher than in 2018. A turnover increase was achieved both at food stores (1.3%) as non-food stores (2.9%). Online revenues were 17% higher 17% in 2019 than in 2018.
Destatis reported that inflation in Germany has risen from 1.5% on an annual basis in December 2019 to 1.7% on an annual basis in January 2020. This brought inflation to the highest level in nine months. Based on the European harmonized measurement method, inflation was 1.6% on an annual basis in January, compared to 1.5% in December.
The 6M Euribor is unchanged at -0.35% compared to previous business day. The 10Y Swap increased with 1 basis point to -0.02% compared to previous business day.
In the European Parliament the new ECB President Christine Lagarde announced yesterday that central banks should pay more attention to the effects and risks of climate change and the transition to a climate-neutral economy, in addition to the traditional task of monitoring price stability. Last month, the bank launched a large-scale review of its monetary policy, which should be completed by the end of this year.
The number of bankrupt companies in the Netherlands has increased according to Statistics Netherlands (CBS). Compared to December, 28 more companies were declared bankrupt in January. In total, 268 companies were declared bankrupt in January. With 59 companies trade had the highest number of bankruptcies of all industries.
New figures from Statistics Netherlands show that the average selling price of an existing owner-occupied house is EUR 200,000 or lower in only fourteen Dutch municipalities. In 2018, in thirty municipalities the average price of a house was less than EUR 200,000. Nationwide, the average price of a house in the Netherlands reached a historical record of EUR 308,000 in 2019.
The 6M Euribor decreased with 1 basis point to -0.35% compared to previous business day. The 10Y Swap increased with 2 basis points to -0.03% compared to previous business day.
Fear for the coronavirus at stock exchanges pushes the price of gold. Press bureau Bloomberg announced that the price of gold has increased yesterday for the fourth consecutive business day. The price of a troy ounce of gold (31.1 grams) reached the highest level since 2013 at USD 1,573. During turbulent times on stock markets, the precious metal is often regarded as a safe option. The prices of other precious metals such as palladium, platinum and silver have also increased.
Inflation in China in January increased as a result of the higher food prices. According to figures from the Chinese National Bureau of Statistics, the inflation increased from 4.5% on yearly base in December to 5.4% in January. This is the highest level in eight years. The higher food prices are the result of the Chinese New Year, the outbreak of the coronavirus and the outbreak of African swine fever which caused the increase of the price of pork.
According to press bureau Bloomberg, the Libyan economy is the main subject since Sunday at a conference of the United Nations in Cairo. The summit started three weeks after the blockades of the harbours and oil production installations started in Libya. The country possesses the largest oil reserves in Africa, but only produces 180,000 barrels of oil per day as a result of the blockades from militias that devastate the country. In the begin of January the daily production amounted up to 1.2 million barrels.
Following ING and ABN Amro, the Rabobank initiated negative interest towards wealthy clients. Both business and private clients with more than EUR 1 million on their account will pay 0.5% interest on their capital as of 1 May.
The 6M Euribor is unchanged at -0.34% compared to previous business day. The 10Y Swap decreased with 4 basis points to -0.05% compared to previous business day.
Data from Johns Hopkins CSSE showed that 40.600 people worldwide are infected with the coronavirus. More than 40.000 infections are recorded on China’s mainland. Nearly no deaths occurred outside of China and Hong Kong. A total of 910 people have died of the coronavirus. This brings the mortality rate to 2.2%. The World Health Organization (WHO) declared an international emergency on January 30.
According to Binckbank’s investor barometer, investor confidence is under more pressure in February due to the coronavirus outbreak. On a scale of -10 to +10, the stock market barometer recorded 3.9 in February compared to January at 4.8. The highest level since 2017 was reached. The majority of investors remain positive about the financial markets.
The Federal Reserve announced that consumer credit in the United States has increased sharply in December. Consumer credit increased by USD 22.1 billion in December, following an increase of USD 11.8 billion in November. This increase is the strongest pace in five months.The 6M Euribor increased with 1 basis point to -0.34% compared to previous business day. The 10Y Swap decreased with 2 basis points to -0.01% compared to previous business day.
ECB President Christine Lagarde warned the European Parliament on Thursday that due to the low interest rates and low inflation, the possibilities for the ECB and other central banks to further widen monetary policy in the event of an economic downturn are limited. Earlier this week, the deputy president of the ECB Luis de Guindos already warned that negative side effects of the loose monetary policy are becoming more visible.
The three American stock markets closed higher on Thursday. The Dow Jones rose 0.30% while the Nasdaq and the S&P 500 won 0.67% and 0.33% respectively. Investors reacted positively to China’s plans to halve import tariffs on some American goods. Later today, the US Department of Labor will publish its job report. Economists expect 163,000 new jobs in January 2020 which would lead to the lowest unemployment rate in half a century.
The Asian stock markets closed lower on Friday. The Japanese Nikkei, Hang Seng in Hong Kong and the combined stock market in Shanghai lose between 0.2% and 0.7%. The European stock markets seem to follow the losses on the Asian stock markets on Friday. On Thursday, the AEX index had shortly reached 619.03 points, the highest position since 2001.
The 6M Euribor decreased with 1 basis point to -0.35% compared to previous business day. The 10Y Swap decreased with 1 basis point to 0.01% compared to previous business day.
The United States trade deficit has decreased in 2019 for the first time in six years. Press bureau Bloomberg announced that the deficit shrank with 1.7% to an amount of USD 616.8 billion. The lower deficit is caused by lower imports from China, which resulted from the trade war between the two countries. The decreased import of oil has also reduced the trade deficit.
According to market researcher ISM, the services sector in the United States grew more in January 2020 than in December 2019. The purchasing managers’ index for the services sector recorded a level of 55.1 compared to 54.9 a month earlier. A position of 50 or more indicates growth, below 50 indicates shrinkage.
The services industry in the Eurozone shows a lower growth in January 2020 than a month earlier. This is shown by final figures from market researcher Markit. The purchasing managers’ index for the services sector recorded a level of 52.5 compared to 52.8 a month earlier. Economists expected a level of 52.2 in January.
The 6M Euribor is unchanged at -0.34% compared to previous business day. The 10Y Swap increased with 4 basis points to 0.02% compared to previous business day.
According to market researchers Caixin and Markit, the service sector in China grew less in January 2020 than in December 2019. The purchasing managers’ index for the services sector stood at 51.8 compared to 52.5 a month earlier. Economists expected a score of 52.0.
The European Statistical Office Eurostat announced that producer prices in the Euro area remained the same in December as they were in November. Throughout the European Union, producer prices increased by 0.2% on a monthly basis. The Netherlands and Romania had the largest increases in producer prices (both 0.5%).
Figures from the US Department of Commerce show that factory orders in the United States increased by 1.8% in December compared to November. In particular, orders for durable goods (2.4%) increased. In November, factory orders decreased by a revised 1.2%.
The 6M Euribor is unchanged at -0.34% compared to previous business day. The 10Y Swap increased with 4 basis points to -0.02% compared to previous business day.
China is considering to reduce its 2020 growth target because of the outbreak of the coronavirus. This is reported by press bureau Bloomberg based on insiders. China initially planned a growth of about 6% this year. However, with the outbreak of the virus, the growth rate will probably reach a level below 6%. The Chinese government is considering increasing the limit on the country’s budget deficit-to-GDP ratio and give out special government loans to stimulate recovery of the economy. Bloomberg adds that final decisions have not been made yet.
The industry in the United States shows growth for the first time since the summer of 2019. Figures from research firm ISM show that activity in the US industry grew in January. The purchasing managers’ index recorded a level of 50.9 against 47.2 in December.
Final figures from research firm Markit show that activity in the industry in the Eurozone decreased in January. The purchasing managers’ index recorded a level of 47.9 against 46.3 in December. A position of 50 or more indicates growth, below 50 indicates shrinkage.
The 6M Euribor is unchanged at -0.34% compared to previous business day. The 10Y Swap decreased with 1 basis point to -0.06% compared to previous business day.
The Chinese central bank (PBoC) comes to the aid of companies located in the area affected by the coronavirus. The national bank makes CNY 300 billion, or EUR 39 billion, available to banks in order to be able to provide money to companies in order to maintain liquidity. In addition, loans granted to affected companies cannot be withdrawn and the central bank argues that banks should lower interest rates. Furthermore, companies are given more time from the regulator before figures for 2019 and the first quarter of 2020 have to be published. Small businesses in particular must be spared, says PBoC.
Figures from research firms Markit and Caixin show that activity in the Chinese industry grew slightly less in January. The data does not yet include the impact of the coronavirus outbreak. The purchasing managers’ index recorded a level of 51.1 against 51.5 in December. A position of 50 or more indicates growth, below 50 indicates shrinkage. Macroeconomic figures from China are expected to deteriorate considerably in the coming period due coronavirus outbreak.
Based on preliminary figures, Statistics Netherlands (CBS) reports that the growth in the export value of Dutch export to the United Kingdom is lagging for the third year in a row. In 2019, the value of Dutch goods exports to the UK was 40 billion euros. That is 0.5% less than a year earlier. In 2015, exports to the UK accounted for 8.7% of total Dutch goods exports. Four years later, with the British leaving the EU, this has fallen to 7.7%.
The 6M Euribor is unchanged at -0.34% compared to previous business day. The 10Y Swap decreased with 2 basis points to -0.05% compared to previous business day.