Europe slowing as US grows
THE EUROZONE continues to look weak as industrial data published yesterday showed the economy in decline, while the US kept growing with positive jobs figures.
German industrial orders plummeted in January, falling 2.7 per cent on the month as foreign orders collapsed.
Export orders fell 5.5 per cent, led by an 8.6 per cent fall in non-Eurozone demand which economists believe will weigh on the economy.
“This was a weak report which confirmed our view that industrial production will remain very subdued in the near term,” said Barclays Capital’s Thomas Harjes. “Our German GDP growth forecast remains at 0.1 per cent for the first quarter of 2012 and we expect only some slight improvement in the following quarter.”
Spanish industrial output dropped for the fifth consecutive month, falling 4.2 per cent in January, faster than the 3.5 per cent decline in December.
Meanwhile, US employment rose by 216,000 in February, up from the 173,000 gain in January, ADP Employer Services reported yesterday.
The upbeat figures point to growth across the economy, and add to a growing stack of evidence that the economy is gradually speeding up – in stark contrast to the Eurozone’s continuing crisis.
Activity in home purchases also picked up last week, rising 2.1 per cent according to the Mortgage Bankers Association (MBA), although overall mortgage applications slumped 1.2 per cent on the week as refinancing activity fell by two per cent.
Meanwhile, Australian GDP growth slowed to 0.4 per cent in the final quarter of 2011, taking growth for 2011 to 2.3 per cent.