European and American economies
2023-11-06
■ The US economy: led by personal consumption, the speed of economic expansion has accelerated.
■ European economy: Corporate and household confidence continues to deteriorate.
In the July-September quarter, the actual gross domestic product (GDP) growth rate (preliminary data, a year-on-year increase of 4.9%) reached its highest level since the October-December quarter of 2021. Personal consumption (up 4.0%) has significantly increased, becoming the main driving force for economic growth. In addition, there has been an increase in residential investment, which has continued to decline from the quarter of April to June 2021. Although equipment investment rebounded slightly due to the significant increase in equipment investment in the previous quarter, the main demand items have all increased, ensuring an increase in the speed of US economic expansion.
In September, the sales of new residential buildings (converted to an annual rate of 759000 units, an increase of 12.3% compared to the previous month) significantly increased, and the sales volume reached the highest level since February 2022. Although the increase in housing loan interest rates has dampened sales, the low inventory level of second-hand housing has led to an increase in demand for replacement of newly built residential properties, as well as a slight decrease in sales prices (median of $418800), which has contributed to the growth in sales.
In October, the Eurozone consumer confidence index (preliminary data was -17.9, a decrease of 0.1 percentage points from the previous month) fell for the third consecutive month. Although the business sentiment continued to deteriorate during the period ending in July, consumer confidence continued to improve despite lagging behind.
In October, the Eurozone Purchasing Managers' Index (preliminary data) showed a decrease in both the manufacturing industry (43.0, a decrease of 0.4 percentage points from the previous month) and the service industry (47.8, a decrease of 0.9 percentage points from the previous month). Although the downward trend of the purchasing managers' index slowed down in September, it has not yet emerged from the downward trend. The activity index of both manufacturing and service industries is below 50, indicating a sustained stagnation of corporate activity. Specifically, new orders from both the manufacturing and service industries have decreased to levels after the outbreak of the epidemic, indicating signs of declining demand.
■ European economy: Corporate and household confidence continues to deteriorate.
In the July-September quarter, the actual gross domestic product (GDP) growth rate (preliminary data, a year-on-year increase of 4.9%) reached its highest level since the October-December quarter of 2021. Personal consumption (up 4.0%) has significantly increased, becoming the main driving force for economic growth. In addition, there has been an increase in residential investment, which has continued to decline from the quarter of April to June 2021. Although equipment investment rebounded slightly due to the significant increase in equipment investment in the previous quarter, the main demand items have all increased, ensuring an increase in the speed of US economic expansion.
In September, the sales of new residential buildings (converted to an annual rate of 759000 units, an increase of 12.3% compared to the previous month) significantly increased, and the sales volume reached the highest level since February 2022. Although the increase in housing loan interest rates has dampened sales, the low inventory level of second-hand housing has led to an increase in demand for replacement of newly built residential properties, as well as a slight decrease in sales prices (median of $418800), which has contributed to the growth in sales.
In October, the Eurozone consumer confidence index (preliminary data was -17.9, a decrease of 0.1 percentage points from the previous month) fell for the third consecutive month. Although the business sentiment continued to deteriorate during the period ending in July, consumer confidence continued to improve despite lagging behind.
In October, the Eurozone Purchasing Managers' Index (preliminary data) showed a decrease in both the manufacturing industry (43.0, a decrease of 0.4 percentage points from the previous month) and the service industry (47.8, a decrease of 0.9 percentage points from the previous month). Although the downward trend of the purchasing managers' index slowed down in September, it has not yet emerged from the downward trend. The activity index of both manufacturing and service industries is below 50, indicating a sustained stagnation of corporate activity. Specifically, new orders from both the manufacturing and service industries have decreased to levels after the outbreak of the epidemic, indicating signs of declining demand.