After record declines the PMI surveys for June suggests that a rebound is underway. But then this was expected. And doesn’t alter the outlook of a long and uncertain recovery. The chances of substantial job losses and preventing a flare-up in infections as the economy open up will be among the key challenges. Look no further than the US which has already seen some of the states reimpose restrictions as the second wave continues to intensify.
Retail sales bounced back in May across much of the developed world, thanks to pent up consumer demand. Infections also seem stable across much of Europe. So does this mean a swift recovery from here on? Sadly, perhaps not. Labour markets remain fragile and new infections are rising globally, including parts of the US. So unsurprisingly, policy taps were loosened further last week.
Continue reading
The incoming labour market data is continuing to catch-up with the economic impact of the COVID-19 pandemic. This is increasingly evident in some of the data sets more than others.
Continue reading
Normally around this time of year, Alice Cooper’s iconic song “School’s Out for Summer” captured the mood music for school kids. With exams over, it was a time for celebration as the summer break beckoned.
Continue readingLast week was a bit of a reality check – the largest ever monthly drop in the UK GDP, signs of a second wave in the southern US and a bout of market volatility. At least numerous indicators point towards a bottoming out of economic activity across much of the world. The road ahead has opened up for a run at a recovery.
A week with cause for cautious optimism. The report card on various countries reopening show no upturn in cases in Western Europe. While a better than expected US jobs report and recovering PMIs in China provide some encouragement. But the damage wrought is extensive. It will be a long, arduous journey through recovery with the risk of setbacks along the way considerable. The rising number of cases in the southern US a prime example.
Today sees the release of May data from the Ulster Bank Northern Ireland PMI®. The latest report – produced for Ulster Bank by IHS Markit – signalled further steep declines in business activity and new orders in the Northern Ireland private sector as the coronavirus disease 2019 (COVID-19) crisis continued.
Continue readingWe are now in the midst of a record-breaking period for the global economy – but for all the wrong reasons. With data now available for April – the first full month lockdown restrictions were in force in most major western nations – most indicators make for depressing reading.
Last month saw an abundance of two things – national variations in how to ease lockdown measures and additional policy support. The latter especially prominent in the EU and Asia’s largest economies (Japan’s additional fiscal stimulus elevated it to the largest in the world). Green shoots followed. But beware famous last words.
Continue readingLast week, several economies reopened without a material evidence of a spike in infection rates, well, so far. That said, the northern-southern hemisphere divide in the number of cases continues to widen, leading some (incl. the Fed) to believe that there might be a second wave. Two risks resurfaced – escalation of US-China trade tensions and disruptive Brexit. On the activity front, data for May suggests that the worst might be behind us.
