United States and European economies
2023-04-11
■The US economy and labor market show signs of adjustment
■The European economy and German manufacturing activity experienced a strong recovery in February
The ISM sentiment index for March showed that the manufacturing industry (46.3, a decrease of 1.4 percentage points from the previous month) reached its lowest level since May 2020. All major indicators show a reduction in the activity below 50, especially with the deterioration of new orders being more significant. In addition, the non-manufacturing industry (51.2, a year-on-year decrease of 3.9 percentage points) has been declining for two consecutive months, reaching its lowest level since December last year due to the impact of the cold wave. Similar to the manufacturing industry, the sharp decline in new orders indicates a decrease in service demand.
According to employment statistics in March, the number of non-agricultural sector employees (a month-on-month increase of 236000) has slowed down compared to the previous month. The unemployment rate (3.5%, a decrease of 0.1% month-on-month) remains stable at a low level, and the average hourly wage (a year-on-year increase of 4.2%, a month-on-month increase of 0.3%) has strengthened month-on-month growth, indicating the overall strength of the labor market.
According to the February Job Recruitment and Labor Force Change Survey (JOLTS), the number of job opportunities (9.931 million) has decreased for two consecutive months, dropping to the lowest level since May 2021. Consistent with the predicted indicator Indeed job opportunity quantity index (monthly average), the number of job opportunities has significantly decreased. In addition, the forecast indicators also decreased in March, indicating that the downward trend in the number of job opportunities may continue.
On the German side, the mining industry production (up 2.0% month-on-month), mining industry orders (up 4.8% year-on-year), and exports (up 4.0% year-on-year) all increased significantly in February, indicating that the decline at the end of last year was temporary. Exports are a monetary measure-based indicator that has reached a three-month high with rising prices, while quantity-based indicators have led to a significant increase in mining industry production and new orders. With the relaxation of restrictions on component procurement and the reopening of China's economic activities, capital goods, and durable consumer goods are experiencing a strong recovery.
The Eurozone Producer Price Index increased by 13.2% year-on-year in February and decreased by 0.5% month-on-month. The year-on-year growth rate slowed down and the month-on-month decline continued for two consecutive months. Due to the decrease in energy prices, the upward trend of intermediate products has also begun to slow down, and inflationary pressure is gradually easing. However, the price increase of capital and consumer goods continues, and there is still a possibility of sustained high inflation in the short term.