Mortgage News You Can Use
US again outshines euro zone in key OECD indicator
Fri February 6, 2004 06:44 AM ET
By Jon Boyle
PARIS, Feb 6 (Reuters) - U.S. economic prospects continued to improve strongly in December but Italy's problems dimmed the outlook for the euro zone, according to the OECD's forward-looking indicator published on Friday.
The OECD data was the latest sign that the United States was leading the global economic recovery and leaving rivals in Europe and Japan well in its wake.
"Moderate to strong recovery lies ahead in the OECD area," the Paris-based Organisation for Economic Cooperation and Development said in a statement accompanying its report.
"December data signal continued strong improvement in the United States but weaker development for Italy."
Italy's sharp fall dragged down the overall rate of increase for the euro zone. The euro zone's underlying six-month rate of change dropped for the first time after seven months of rises.
For the 30-nation membership of the OECD, the December leading indicator rose to 123.6 from 122.8 in November.
The reading for the United States was 133.3 (up from 131.7), neighbour Canada was at 131.7 (130.0), the 12-nation euro currency zone struggled up to 123.8 (123.5) and Japan managed a weak increase of 0.2 to 102.3.
Of the G7 major economies, only Italy showed weaker development, its index slipping to 106.3 in December from 107.8 in November. Italian consumer confidence has taken a heavy hit from the scandal at the food group Parmalat.
The OECD noted that the six-month rate of change in the euro area had "fallen for the first time after seven months of increases." Japan's six-month rate of change was down for the second month in a row after a half-year of improvement.
The index's rise in major European economies was far stronger than that of the 15 European Union states, whose overall index was 121.9 in December, up from 121.5 previously.
Britain recorded a 0.8 point rise in December to 108.7, and its six-month rate of change increased for nine straight months.
Germany rose by 1.1 points in December to 129.2, with its six-month rate of change showing strong increases over the past eight months after almost a year of declines, the OECD said.
France, the second biggest euro zone economy after Germany, increased 0.9 points in December to 120.1.
FASTER GLOBAL GROWTH?
The OECD data follows an Italian report that the International Monetary Fund has revised upward its growth forecasts for 2004, due to better than expected prospects for growth in the U.S. economy.
Italy's ANSA news agency reported on Thursday that an early copy of the IMF's latest economic report due to be published shortly said the U.S. was leading the recovery, while Asia -- especially China -- were "contributing to the robust recovery".
On Wednesday, a survey showed the dominant services sector had surged to a seven-year high in the United States, a strong performance mirrored in the euro zone and Britain. But signs of a strong recovery have not been accompanied by more jobs.
Policymakers in Europe have complained that the dollar's sharp fall against the euro was making life hard for exporters.
But with U.S. presidential elections in November, Nobel Prize-winning economist Joseph Stiglitz said Washington would oppose any efforts by G7 members to halt the dollar's fall.
"(U.S. President) George W. Bush needs the fall in the dollar to support American growth and to be re-elected. Even if that is to the detriment of Europe," he told France's La Tribune business daily on Friday.
Continue with:
Home Equity Loans Rates Online Refinancing Loan 125%
Mortgage Refinance - Lowest Mortgage Rates - |
