CMP Associates Regulation Blog

Chart VA-2 of the US Census Bureau provides total US sales of manufacturing, retailers and wholesalers not seasonally adjusted (NSA) in millions of dollars. The series without adjustment shows sharp jagged behavior because of monthly fluctuations following seasonal patterns. There is sharp recovery from the global recession in a robust trend, which is mixture of price and quantity effects because data are not adjusted for price changes. There is stability in the final segment with monthly marginal strength.

Chart VA-2, US, Total Business Sales of Manufacturers, Retailers and Merchant Wholesalers, NSA, Millions of Dollars, Jan 1992-Oct 2013

US Census Bureau

Businesses added cautiously to inventories to replenish stocks. Retailers added 0.8 percent to inventories in Oct 2013 and 1.0 percent in Sep 2013 with growth of 6.0 percent in 12 months, as shown in Table VA-2. Total business increased inventories by 0.7 percent in Oct, 0.6 percent in Sep and 3.5 percent in 12 months. Inventories sales/ratios of total business continued at a level close to 1.29 under careful management to avoid costs and risks. Inventory/sales ratios of manufacturers and retailers are higher than for merchant wholesalers. There is stability in inventory/sales ratios in individual months and relative to a year earlier.

Table VA-2, US, Percentage Changes for Inventories of Manufacturers, Retailers and Merchant Wholesalers and Inventory/Sales Ratios

Inventory Change	Oct 13 Millions of Dollars NSA	Oct 13/ Sep 13 ∆% SA	Sep 13/ Aug 13 ∆% SA	Oct 13/ Oct 12 ∆% NSA
Total Business	1,725,045	0.7	0.6	3.5
Manufacturers	636,732	0.1	0.3	1.8
Retailers	569,234	0.8	1.0	6.0
Merchant Wholesalers	519,079	1.4	0.5	3.1
Inventory/ Sales Ratio NSA	Oct 13 Billions of Dollars NSA	Oct 2013 SA	Sep 2013 SA	Aug 2012 SA
Total Business	1,725,045	1.29	1.29	1.30
Manufacturers	636,732	1.29	1.29	1.29
Retailers	569,234	1.42	1.42	1.39
Merchant Wholesalers	510.079	1.18	1.18	1.22

Source: US Census Bureau http://www.census.gov/mtis/

Chart VA-3 of the US Census Bureau provides total business inventories of manufacturers, retailers and merchant wholesalers seasonally adjusted (SA) in millions of dollars from Jan 1992 to Oct 2013. The impact of the two recessions of 2001 and IVQ2007 to IIQ2009 is evident in the form of sharp reductions in inventories. Inventories have surpassed the peak before the global recession. Data are not adjusted for price changes.

Chart VA-3, US, Total Business Inventories of Manufacturers, Retailers and Merchant Wholesalers, SA, Millions of Dollars, Jan 1992-Oct 2013

US Census Bureau

Chart VA-4 provides total business inventories of manufacturers, retailers and merchant wholesalers not seasonally adjusted (NSA) from Jan 1992 to Oct 2013 in millions of dollars. The recessions of 2001 and IVQ2007 to IIQ2009 are evident in the form of sharp reductions of inventories. There is sharp upward trend of inventory accumulation after both recessions. Total business inventories are higher than in the peak before the global recession.

Chart VA-4, US, Total Business Inventories of Manufacturers, Retailers and Merchant Wholesalers, NSA, Millions of Dollars, Jan 1992-Oct 2013

US Census Bureau

http://www2.census.gov/retail/releases/historical/mtis/img/mtisbrf.gif

Inventories follow business cycles. When recession hits sales inventories pile up, declining with expansion of the economy. In a fascinating classic opus, Lloyd Meltzer (1941, 129) concludes:

“The dynamic sequences (i) through (6) were intended to show what types of behavior are possible for a system containing a sales output lag. The following conclusions seem to be the most important:

(i) An economy in which business men attempt to recoup inventory losses will always undergo cyclical fluctuations when equilibrium is disturbed, provided the economy is stable.

This is the pure inventory cycle.

(2) The assumption of stability imposes severe limitations upon the possible size of the marginal propensity to consume, particularly if the coefficient of expectation is positive.

(3) The inventory accelerator is a more powerful de-stabilizer than the ordinary acceleration principle. The difference in stability conditions is due to the fact that the former allows for replacement demand whereas the usual analytical formulation of the latter does not. Thus, for inventories, replacement demand acts as a de-stabilizer. Whether it does so for all types of capital goods is a moot question, but I believe cases may occur in which it does not.

(4) Investment for inventory purposes cannot alter the equilibrium of income, which depends only upon the propensity to consume and the amount of non-induced investment.

(5) The apparent instability of a system containing both an accelerator and a coefficient of expectation makes further investigation of possible stabilizers highly desirable.”

Chart VA-5 shows the increase in the inventory/sales ratios during the recession of 2007-2009. The inventory/sales ratio fell during the expansions. The inventory/sales ratio declined to a trough in 2011, climbed and then stabilized at current levels in 2012 and 2013.

Chart VA-5, Total Business Inventories/Sales Ratios 2002 to 2013

Source: US Census Bureau

Manufacturers’ shipments increased 0.1 percent in Oct 2013 and 0.1 percent in Sep 2013 after increasing 0.2 percent in Aug 2013. New orders decreased 0.9 percent in Oct 2013, after increasing 1.8 percent in Sep 2013 and decreasing 0.1 percent in Aug 2013, as shown in Table VA-3. These data are very volatile. Volatility is illustrated by increase of 2642.2 percent of new orders of nondefense aircraft in Sep 2012 following decline by 97.2 percent in Aug. New orders excluding transportation equipment changed 0.0 percent in Oct 2013 after decreasing 0.1 percent in Sep 2013 and decreasing 0.4 percent in Aug 2013. Capital goods new orders, indicating investment, decreased 4.8 percent in Oct 2013 after increasing 8.2 percent in Sep 2013 and decreasing 0.4 percent in Aug 2013. New orders of nondefense capital goods decreased 3.4 percent in Oct 2013 after increasing 7.0 percent in Sep 2013 and decreasing 0.1 percent in Aug 2013. Excluding more volatile aircraft, capital goods orders decreased 0.6 percent in Oct 2013 after decreasing 1.2 percent in Sep 2013 and increasing 1.0 percent in Aug 2013.

Table VA-3, US, Value of Manufacturers’ Shipments and New Orders, SA, Month ∆%

	Oct 2013 ∆%	Sep 2013 ∆%	Aug 2013 ∆%
Total
S	0.1	0.1	0.2
NO	-0.9	1.8	-0.1
Excluding Transport
S	-0.1	0.0	-0.1
NO	0.0	-0.1	-0.4
Excluding Defense
S	0.1	0.1	0.0
NO	-0.6	1.4	0.1
Durable Goods
S	0.4	0.5	1.0
NO	-1.6	4.2	0.5
Machinery
S	0.8	0.6	0.5
NO	0.7	-1.7	0.7
Computers & Electronic Products
S	-2.3	0.8	1.8
NO	0.6	5.0	-4.6
Computers
S	-11.3	-2.8	-22.7
NO	-4.3	11.2	0.2
Transport Equipment
S	1.1	0.5	1.6
NO	-5.7	13.1	1.8
Automobiles
S	2.3	2.0	7.1
Motor Vehicles
S	0.2	0.6	3.6
NO	0.4	-0.6	4.2
Nondefense Aircraft
S	2.4	4.0	-5.0
NO	-15.9	59.2	5.4
Capital Goods
S	-0.2	0.0	1.5
NO	-4.8	8.2	-0.4
Nondefense Capital Goods
S	0.1	0.5	0.4
NO	-3.4	7.0	-0.1
Capital Goods ex Aircraft
S	-0.1	-0.1	1.4
NO	-0.6	-1.2	1.0
Nondurable Goods
S	-0.2	-0.3	-0.6
NO	-0.2	-0.3	-0.6

Note: Mfg: manufacturing; S: shipments; NO: new orders; Transport: transportation

Source: US Census Bureau http://www.census.gov/manufacturing/m3/

Chart VA-6 of the US Census Bureau provides new orders of manufacturers from Oct 2012 to Sep 2013. There is significant volatility that prevents discerning clear trends.

Chart VA-6, US, Manufacturers’ New Orders 2010-2011 Seasonally Adjusted, Month ∆%

Source: US Census Bureau

http://www.census.gov/briefrm/esbr/www/esbr022.html

Chart VA-7 of the US Census Bureau provides total value of manufacturers’ new orders, seasonally adjusted, from 1992 to 2013. Seasonal adjustment reduces sharp oscillations. The series dropped nearly vertically during the global recession but rose along a path even steeper than in the high-growth period before the recession. The final segment suggests deceleration but similar segments occurred in earlier periods followed with continuing growth and stability currently.

Chart VA-7, US, Value of Total Manufacturers’ New Orders, Seasonally Adjusted, 1992-2013

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Additional perspective on manufacturers’ shipments and new orders is provided by Table VA-4. Values are cumulative millions of dollars in Jan-Oct 2013 not seasonally adjusted (NSA). Shipments of all manufacturing industries in Jan-Oct 2013 total $4876.8 billion and new orders total $4847.4 billion, growing respectively by 1.7 percent and 2.4 percent relative to the same period in 2012. Excluding transportation equipment, shipments grew 0.7 percent and new orders increased 1.5 percent. Excluding defense, shipments grew 1.7 percent and new orders grew 2.8 percent. Durable goods shipments reached $2305.0 billion in Jan-Oct 2013, or 47.2 percent of the total, growing by 3.3 percent, and new orders $2275.6 billion, or 46.9 percent of the total, growing by 4.8 percent. Important information in Table VA-2 is the large share of nondurable goods with shipments of $2308.7 billion or 52.7 percent of the total, growing by 0.3 percent. Capital goods have relatively high value of $827.3 billion for shipments, growing 2.1 percent, and new orders $863.8 billion, increasing 4.2 percent, which could be an indicator of future investment. Excluding aircraft, capital goods shipments reached $654.7 billion, growing 1.4 percent, and new orders $674.9 billion, increasing 4.2 percent. There is no suggestion in these data that the US economy is close to recession but manufacturing accounts for 10.8 percent of US national income in IIQ2013. These data are not adjusted for inflation.

Table VA-4, US, Value of Manufacturers’ Shipments and New Orders, NSA, Millions of Dollars

Jan-Oct 2013	Shipments	∆% 2013/ 2012	New Orders	∆% 2013/ 2012
Total	4,876,764	1.7	4,847,375	2.4
Excluding Transport	4,193,556	0.7	4,147,088	1.5
Excluding Defense	4,757,025	1.7	4,743,896	2.8
Durable Goods	2,305,008	3.3	2,275,619	4.8
Machinery	342,614	3.2	348,189	7.1
Computers & Electronic Products	273,984	-3.8	209,808	-3.1
Computers	5,072	-28.3	5,201	-28.9
Transport Equipment	683,208	8.0	700,287	8.1
Automobiles	106,771	21.3
Motor Vehicles	196,915	5.6	196,022	6.1
Nondefense Aircraft	109,467	9.1	143,232	20.4
Capital Goods	827,347	2.1	863,751	4.2
Nondefense Capital Goods	730,313	2.3	780,779	6.5
Capital Goods ex Aircraft	654,668	1.4	674,972	4.2
Nondurable Goods	2,571,756	0.3	2,571,756	0.3
Food Products	618,407	2.8
Petroleum Refineries	693,401	-1.4
Chemical Products	643,692	-0.5

Note: Transport: transportation Source: US Census Bureau http://www.census.gov/manufacturing/m3/

Chart VA-8 of the US Census Bureau provides value of manufacturer’s new orders not seasonally adjusted from Jan 1992 to Oct 2013. Fluctuations are evident, which are smoothed by seasonal adjustment in the earlier Chart VA-7. The series drops nearly vertically during the global contraction and then resumes growth in a steep upward trend, flattening recently.

Chart VA-8, US, Value of Total Manufacturers’ New Orders, Not Seasonally Adjusted, 1992-2013

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Sales and inventories of merchant wholesalers except manufacturers’ sales branches and offices are shown in Table VA-5 for Jan-Oct 2013 NSA and percentage changes from the prior month SA and for Jan-Oct 2013 relative to Jan-Oct 2012. These data are volatile, aggregating diverse categories of durable and nondurable goods without adjustment for price changes. Total sales for the US rose 3.9 percent in Jan-Oct 2013 relative to Jan-Oct 2012 and increased 1.0 percent in Oct 2013 relative to Sep 2013. The value of total sales is quite high at $4257.2 billion, approaching five trillion dollars in a year. Value in the breakdown is useful in identifying relative importance of individual categories. Sales of durable goods in Jan-Oct 2013 reached $1965.5 billion, over two trillion dollars for a year, changing 0.0 percent in Oct 2013 relative to Sep 2013 and increasing 4.2 percent in Jan-Oct 2013 relative to Jan-Oct 2012. Sales of automotive products reached $338.3 billion in Jan-Oct 2013, decreasing 4.5 percent in the month and increasing 3.2 percent relative to a year earlier. There is strong performance of 11.3 percent in machinery but lower of 4.8 percent in electrical products. Sales of nondurable goods rose 3.5 percent over a year earlier. The influence of commodity prices returned as suggested by change of 0.0 percent in Oct 2013 and increase of 3.1 percent in Jan-Oct 2013 relative to a year earlier in farm products with increase of 3.6 percent in petroleum products in Oct 2013 and increase of 1.7 percent relative to a year earlier. The final three columns in Table VA-4 provide the value of inventories and percentage changes from the prior month and relative to the same month a year earlier. US total inventories of wholesalers increased 1.4 percent in Oct 2013 and increased 3.1 percent relative to a year earlier. Inventories of durable goods of $316.6 billion are 61.0 percent of total inventories of $519.1 billion and rose 4.1 percent relative to a year earlier. Automotive inventories increased 1.6 percent relative to a year earlier. Machinery inventories of $91.4 billion rose 7.7 percent relative to a year earlier. Inventories of nondurable goods of $202.5 billion are 39.0 percent of the total and increased 1.7 percent relative to a year earlier. Inventories of farm products increased 17.0 percent in Oct relative to Sep and decreased 22.8 percent relative to a year earlier. Inventories of petroleum products increased 1.2 percent in Oct and increased 2.8 percent relative to a year earlier.

Table VA-5, US, Sales and Inventories of Merchant Wholesalers except Manufacturers’ Sales Branches and Offices, Month ∆%

2013	Sales $ Billions Jan-Oct 2013 NSA	Sales Oct ∆% SA	Sales∆% Jan-Oct 2013 from Jan-Oct 2012 NSA	INV $ Billions Oct 2013 NSA	INV Oct ∆% SA	INV ∆% Oct 2013 from Oct 2012 NSA
US Total	4257.2	1.0	3.9	519.1	1.4	3.1
Durable	1965.5	0.0	4.2	316.6	0.4	4.1
Automotive	338.3	-4.5	3.2	50.7	2.7	1.6
Prof. Equip.	398.8	-0.7	2.8	38.6	-1.4	3.8
Computer Equipment	232.4	1.3	2.4	16.8	-5.7	-0.6
Electrical	310.8	-0.1	4.8	38.9	-0.8	4.6
Machinery	347.3	3.8	11.3	91.4	0.6	7.7
Not Durable	2291.7	1.8	3.5	202.5	3.0	1.7
Drugs	352.8	0.7	5.2	39.1	3.6	15.9
Apparel	123.9	-1.5	0.6	22.5	-0.2	4.7
Groceries	492.9	2.1	5.2	35.4	0.0	7.8
Farm Products	197.6	0.0	3.1	26.8	17.0	-22.8
Petroleum	621.0	3.6	1.7	22.1	1.2	2.8

Note: INV: inventories

Source: US Census Bureau http://www.census.gov/wholesale/index.html

Chart VA-9 of the US Census Bureau provides sales of wholesale trade NSA from Jan 1992 to Oct 2013. The jagged curve of wholesale trade sales without adjustment shows strong seasonal variations. There is a strong long-term trend interrupted by sharp drop during the global recession. Growth resumed along a stronger upward trend and the level surpasses the peak before the global recession with stability in the final segment.

Chart VA-9, US, Wholesale Trade Sales, Monthly, NSA, Jan 1992-Oct 2013, Millions of Dollars

Source: US Census Bureau

Chart VA-10 of the US Census Bureau provides US wholesale trade sales with seasonal adjustment from Jan 1992 to Oct 2013. The elimination of seasonality permits enhanced comparison of adjacent sales. The final segment identifies another drop followed by increase to a higher level with stability.

Chart VA-10, US, Wholesale Trade Sales, Monthly, SA, Jan 1992-Oct 2013, Millions of Dollars

Source: US Census Bureau

Inventory/sales ratios of merchant wholesalers except manufacturers’ sales branches and offices are shown in Table VA-6. The total for the US has remained almost without change at 1.18 in Oct 2013, 1.18 in Sep 2013 and 1.22 in Oct 2012. Inventory/sales ratios are higher in durable goods industries but remain relatively stable with 1.56 in Oct 2013, 1.55 in Sep 2013 and 1.61 in Oct 2012. Computer equipment operates with low inventory/sales ratios of 0.66 in Oct 2013, 0.71 in Sep 2013 and 0.71 in Oct 2012 because of the capacity to fill orders on demand. As expected because of perishable nature, nondurable inventory/sales ratios are quite low with 0.86 in Oct 2013 and 0.85 in Sep 2013, which are close to 0.89 in Oct 2012. There are exceptions such as 1.83 in Oct 2013 in apparel that is close to 1.80 in Sep 2013 and higher than 1.81 in Oct 2012.

Table VA-6, Inventory/Sales Ratios of Merchant Wholesalers except Manufacturers’ Sales Branches and Offices, % SA

	Oct 2013	Sep 2013	Oct 2012
US Total	1.18	1.18	1.22
Durable	1.56	1.55	1.61
Automotive	1.45	1.35	1.49
Prof. Equip.	0.92	0.93	0.93
Comp. Equip.	0.66	0.71	0.71
Electrical	1.18	1.19	1.19
Machinery	2.45	2.53	2.76
Not Durable	0.86	0.85	0.89
Drugs	1.10	1.06	1.03
Apparel	1.83	1.80	1.81
Groceries	0.67	0.69	0.69
Farm Products	1.22	1.04	1.44
Petroleum	0.36	0.37	0.38

Source: US Census Bureau http://www.census.gov/wholesale/index.html

Inventories of merchant wholesalers except manufacturers’ sales branches in millions of dollars SA are provided in Chart VA-11 of the US Census Bureau. There is evident acceleration in inventory building in the final segment at a sharper slope than before the global recession with recent downward turn followed by stability.

Chart VA-11, US, Inventories of Merchant Wholesalers, Millions of Dollars, NSA, Jan 1992-Oct 2013

Source: US Census Bureau

Inventories of merchant wholesalers except manufacturers’ sales branches in millions of dollars SA are provided in Chart VA-12 of the US Census Bureau. There is evident acceleration in inventory building in the final segment at a sharper slope than before the global recession with recent downward turn followed by increase.

Chart VA-12, US, Inventories of Merchant Wholesalers, Millions of Dollars, SA, Jan 1992-Oct 2013

Source: US Census Bureau

http://www2.census.gov/wholesale/img/mwtsbrf.jpg

Chart VA-13 provides the chart of the US Census Bureau with inventories/sales ratios of merchant wholesalers from 2004 to 2013 seasonally adjusted. Inventory/sales ratios rise during contractions as merchants are caught with increasing inventories because of weak sales and fall during expansions as merchants attempt to fill sales with existing stocks. There is an increase in the inventory/sales ratio in 2012 but not yet significantly higher with declining trend in the final segment followed by an increase and new decline/stability.

Chart VA-13, US, Monthly Inventories/Sales Ratios of Merchant Wholesalers, SA, 2004-2013

Source: US Census Bureau

Sales of retail and food services increased 0.7 percent in Nov 2013 after increasing 0.6 percent in Oct 2013 seasonally adjusted (SA), growing 4.3 percent in Jan-Nov 2013 relative to Jan-Nov 2012 not seasonally adjusted (NSA), as shown in Table VA-7. Excluding motor vehicles and parts, retail sales increased 0.4 percent in Nov 2013, increasing 0.5 percent in Oct 2013 SA and increasing 3.2 percent NSA in Jan-Nov 2013 relative to a year earlier. Sales of motor vehicles and parts increased 1.8 percent in Nov 2013 after increasing 1.1 percent in Oct 2013 SA and increasing 8.9 percent NSA in Jan-Nov 2013 relative to a year earlier. Gasoline station sales decreased 1.1 percent SA in Nov 2013 after decreasing 0.4 percent in Oct 2013 in oscillating prices of gasoline that are moderating, decreasing 0.9 percent in Jan-Nov 2013 relative to a year earlier.

Table VA-7, US, Percentage Change in Monthly Sales for Retail and Food Services, ∆%

	Nov/Oct ∆% SA	Oct/Sep ∆% SA	Jan-Nov 2013 Million Dollars NSA	Jan-Nov 2013 from Jan-Nov 2012 ∆% NSA
Retail and Food Services	0.7	0.6	4,601,195	4.3
Excluding Motor Vehicles and Parts	0.4	0.5	3,720,010	3.2
Motor Vehicles & Parts Dealers	1.8	1.1	881,185	8.9
Retail	0.6	0.5	4,096,281	4.3
Building Materials	1.8	-1.5	289,162	6.2
Food and Beverage	-0.1	-0.1	591,594	3.0
Grocery	-0.3	-0.1	528,755	2.5
Health & Personal Care Stores	0.0	0.5	258,079	2.2
Clothing & Clothing Accessories Stores	-0.2	2.6	218,037	3.7
Gasoline Stations	-1.1	-0.4	503,588	-0.9
General Merchandise Stores	0.1	0.3	584,032	0.6
Food Services & Drinking Places	1.3	1.4	504,914	4.0

Source: US Census Bureau http://www.census.gov/retail/

Chart VA-14 of the US Bureau of the Census shows percentage change of retail and food services sales. Auto sales have been increasing monthly, and particularly relative to a year earlier, but with weakness in the total excluding auto sales and declines or mild growth in general merchandise.

Chart VA-14, US, Percentage Change of Retail and Food Services Sales

Source: US Census Bureau

http://www2.census.gov/retail/releases/historical/marts/img/martsbrf.gif

Chart VA-15 of the US Census Bureau provides total sales of retail trade and food services seasonally adjusted (SA) from Jan 1992 to Nov 2013 in millions of dollars. The impact on sales of the shallow recession of 2001 was much milder than the sharp contraction in the global recession from IVQ2007 to IIQ2009. There is flattening in the final segment of the series followed by another increase. Data are not adjusted for price changes.

Chart VA-15, US, Total Sales of Retail Trade and Food Services, SA, Jan 1992-Nov 2013, Millions of Dollars

Source: US Census Bureau

http://www.census.gov/retail/

Chart VA-16 of the US Census Bureau provides total sales of retail trade and food services not seasonally adjusted (NSA) in millions of dollars from Jan 1992 to Nov 2013. Data are not adjusted for seasonality, which explains sharp jagged behavior, or price changes. There was contraction during the global recession from IVQ2007 to IIQ2009 with strong rebound to a higher level and stability followed by strong increase in the final segment.

Chart VA-16, US, Total Sales of Retail Trade and Food Services, NSA, Jan 1992-Nov 2013, Millions of Dollars

Source: US Census Bureau

http://www.census.gov/retail/

The report of consumer credit outstanding of the Board of Governors of the Federal Reserve System is provided in Table VA-8. The data are in seasonally adjusted annual rates both percentage changes and billions of dollars. The estimate of consumer credit “covers most short- and intermediate-term credit extended to individuals, excluding loans secured by real estate (http://www.federalreserve.gov/releases/g19/current/default.htm). Consumer credit is divided into two categories. (1) Revolving consumer credit (REV in Table VA-8) consists mainly of unsecured credit cards. (2) Non-revolving consumer credit (NREV in Table VA-8) “includes automobile loans and all other loans not included in revolving credit, such as loans for mobile homes, education, boats, trailers or vacations” (http://www.federalreserve.gov/releases/g19/current/default.htm). In Oct 2013, revolving credit was $857 billion, or 27.9 percent of total consumer credit of $3076 billion, and non-revolving credit was $2219 billion, or 72.1 percent of total consumer credit outstanding. Consumer credit grew at relatively high rates before the recession beginning in IVQ2007 (Dec) and extending to IIQ2009 (Jun) as dated by the National Bureau of Economic Research or NBER (http://www.nber.org/cycles/cyclesmain.html). Percentage changes of consumer credit outstanding fell already in 2009. Rates were still negative in 2010 with decline of 1.0 percent in annual data and sharp decline of 7.6 percent in revolving credit. In IVQ 2012, total consumer credit grew at 6.5 percent with increase of revolving credit at 0.3 percent and increase of non-revolving credit at 9.1 percent. Growth continued in Oct 2013 with total credit at 7.1 percent, revolving at 6.1 percent and non-revolving at 7.5 percent.

Table VA-8, US, Consumer Credit Outstanding, SA, Annual Rate and Billions of Dollars

	Total ∆%	REV ∆%	NRV ∆%	Total $B	REV $B	NREV $B
2013
Oct	7.1	6.1	7.5	3076	857	2219
Sep	6.4	-0.3	9.1	3058	853	2205
Aug	6.2	1.4	8.0	3042	853	2189
IIIQ	6.0	0.4	8.1	3058	853	2205
IIQ	5.9	1.2	7.7	3013	852	2161
IQ	6.2	1.5	8.1	2969	849	2120
2012
IVQ	6.5	0.3	9.1	2924	846	2078
IIIQ	4.8	0.4	6.7	2878	845	2033
2012	6.1	0.4	8.7	2924	846	2078
2011	4.1	0.2	5.9	2757	842	1915
2010	-1.0	-7.6	2.7	2648	841	1807
2009	-3.9	-8.8	-1.0	2553	917	1636
2008	1.3	0.2	2.0	2651	1005	1646
2007	5.9	8.5	4.3	2529	1008	1521

Note: REV: Revolving; NREV: Non-revolving; ∆%: simple annual rate from unrounded data; Total may not add exactly because of rounding

Source: Board of Governors of the Federal Reserve System

http://www.federalreserve.gov/releases/g19/current/default.htm

Chart VA-17 of the Board of Governors of the Federal Reserve System total consumer credit outstanding in millions of dollars measured in the right axis and the finance rate on 24-month personal loans at commercial banks, not seasonally adjusted, measured on the left axis. There was sharp decline of total consumer loans outstanding during the global recession followed by strong recovery. There is long-term decline of the financing rate.

Chart VA-17, US, Total Consumer Credit Owned and Securitized NSA and Financing Rate on 24-month Personal Loans at Commercial Banks NSA, Millions of Dollars and Percent, Feb 1972-Oct 2013

Source: Board of Governors of the Federal Reserve System

http://www.federalreserve.gov/releases/g19/current/default.htm

Chart VA-18 of the Board of Governors of the Federal Reserve System provides percentage changes of total consumer credit outstanding in the US and the financing rate on 24-month personal consumer loans at commercial banks, since 1972. The shaded bars are the cyclical contraction dates of the National Bureau of Economic Research (http://www.nber.org/cycles/cyclesmain.html). Consumer credit is cyclical, declining during contractions as shown by negative percentage changes during economic contractions. There is clear upward trend in 2012-2013 but with significant fluctuations.

Chart VA-18, US, Percent Change of Total Consumer Credit, Seasonally Adjusted at an Annual Rate and Finance Rate on 24-month Personal Loans at Commercial Banks NSA, Feb 1972-Oct 2013

Source: Board of Governors of the Federal Reserve System

http://www.federalreserve.gov/releases/g19/current/default.htm

Table VA-9 provides additional information required for understanding the deficit/debt situation of the United States. The table is divided into four parts: Treasury budget in the 2014 fiscal year ending in Nov 2014; federal fiscal data for the years from 2009 to 2012; federal fiscal data for the years from 2005 to 2008; and Treasury debt held by the public from 2005 to 2012. Receipts increased 10.2 percent in the cumulative fiscal year 2014 ending in Nov 2014 relative to the cumulative in fiscal year 2013. Individual income taxes increased 2.7 percent relative to the same period a year earlier. Outlays decreased 4.7 percent relative to a year earlier. Total revenues of the US from 2009 to 2012 accumulate to $9020 billion, or $9.0 trillion, while expenditures or outlays accumulate to $14,109 billion, or $14.1 trillion, with the deficit accumulating to $5089 billion, or $5.1 trillion. Revenues decreased 6.6 percent from $9653 billion in the four years from 2005 to 2008 to $9020 billion in the years from 2009 to 2012. Decreasing revenues were caused by the global recession from IVQ2007 (Dec) to IIQ2009 (Jun) and by growth of only 2.3 percent on average in the cyclical expansion from IIIQ2009 to IIQ2013 (http://cmpassocregulationblog.blogspot.com/2013/11/global-financial-risk-mediocre-united.html). In contrast with the decline of revenue, outlays or expenditures increased 30.2 percent from $10,839 billion, or $10.8 trillion, in the four years from 2005 to 2008, to $14,109 billion, or $14.1 trillion, in the four years from 2009 to 2012. Increase in expenditures by 30.2 percent while revenue declined by 6.6 percent caused the increase in the federal deficit from $1186 billion in 2005-2008 to $5089 billion in 2009-2012. Federal revenue was 14.9 percent of GDP on average in the years from 2009 to 2012, which is well below 17.4 percent of GDP on average from 1973 to 2012. Federal outlays were 23.3 percent of GDP on average from 2009 to 2012, which is well above 20.4 percent of GDP on average from 1973 to 2012. The lower part of Table IIB-4 shows that debt held by the public swelled from $5803 billion in 2008 to $11,281 billion in 2012, by $5478 billion or 94.4 percent. Debt held by the public as percent of GDP or economic activity jumped from 39.3 percent in 2008 to 70.1 percent in 2012, which is well above the average of 39.2 percent from 1973 to 2012 (http://www.cbo.gov/publication/44508). The United States faces tough adjustment because growth is unlikely to recover, creating limits on what can be obtained by increasing revenues, while continuing stress of social programs restricts what can be obtained by reducing expenditures.

Table VA-9, US, Treasury Budget in Fiscal Year to Date Million Dollars

Nov 2013	Fiscal Year 2014	Fiscal Year 2013	∆%
Receipts	381,380	346,045	10.2
Outlays	608,199	638,152	-4.7
Deficit	-226,819	-292,107	NA
Individual Income Taxes	181,818	177,066	2.7
Social Insurance	103,852	83,319	24.6
	Receipts	Outlays	Deficit (-), Surplus (+)
$ Billions
2012	2,450	3,537	-1,087
Fiscal Year 2011	2,302	3,598	-1,296
Fiscal Year 2010	2,163	3,456	-1,293
Fiscal Year 2009	2,105	3,518	-1,413
Total 2009-2012	9,020	14,109	-5,089
Average % GDP 2009-2012	14.9	23.3	-8.4
Fiscal Year 2008	2,524	2,983	-459
Fiscal Year 2007	2,568	2,729	-161
Fiscal Year 2006	2,407	2,655	-248
Fiscal Year 2005	2,154	2,472	-318
Total 2005-2008	9,653	10,839	-1,186
Average % GDP 2005-2008	17.3	19.5	-2.1
Debt Held by the Public	Billions of Dollars	Percent of GDP
2005	4,592	35.6
2006	4,829	35.3
2007	5,035	35.1
2008	5,803	39.3
2009	7,545	52.3
2010	9,019	61.0
2011	10,128	65.8
2012	11,281	70.1

Source: http://www.fms.treas.gov/mts/index.html CBO (2012NovMBR). CBO (2011AugBEO); Office of Management and Budget 2011. Historical Tables. Budget of the US Government Fiscal Year 2011. Washington, DC: OMB; CBO. 2011JanBEO. Budget and Economic Outlook. Washington, DC, Jan. CBO. 2012AugBEO. Budget and Economic Outlook. Washington, DC, Aug 22. CBO. 2012Jan31. Historical budget data. Washington, DC, Jan 31. CBO. 2012NovCDR. Choices for deficit reduction. Washington, DC. Nov. CBO. 2013HBDFeb5. Historical budget data—February 2013 baseline projections. Washington, DC, Congressional Budget Office, Feb 5. CBO. 2013HBDFeb5. Historical budget data—February 2013 baseline projections. Washington, DC, Congressional Budget Office, Feb 5. Congressional Budget Office, 2013CBOHBDMay14. Historical budget data—May 2013. CBO, Washington, DC, May 14. Congressional Budget Office, 2013CBOHD, Historical budget data—August 2013. CBO, Washington, DC, Aug 12.

VB Japan. Table VB-BOJF provides the forecasts of economic activity and inflation in Japan by the majority of members of the Policy Board of the Bank of Japan, which is part of their Outlook for Economic Activity and Prices (http://www.boj.or.jp/en/announcements/release_2013/k130711a.pdf). For fiscal 2013, the forecast is of growth of GDP between 2.6 and 3.0 percent, with the all items CPI less fresh food of 0.6 to 1.0 percent. The critical difference is forecast of the CPI excluding fresh food of 2.8 to 3.6 percent in 2014 and 1.6 to 2.9 percent in 2015. Consumer price inflation in Japan excluding fresh food was 0.3 percent in Oct 2013 and 0.9 percent in 12 months (http://www.stat.go.jp/english/data/cpi/1581.htm). The new monetary policy of the Bank of Japan aims to increase inflation to 2 percent. These forecasts are biannual in Apr and Oct. The Cabinet Office, Ministry of Finance and Bank of Japan released on Jan 22, 2013, a “Joint Statement of the Government and the Bank of Japan on Overcoming Deflation and Achieving Sustainable Economic Growth” (http://www.boj.or.jp/en/announcements/release_2013/k130122c.pdf) with the important change of increasing the inflation target of monetary policy from 1 percent to 2 percent:

“The Bank of Japan conducts monetary policy based on the principle that the policy shall be aimed at achieving price stability, thereby contributing to the sound development of the national economy, and is responsible for maintaining financial system stability. The Bank aims to achieve price stability on a sustainable basis, given that there are various factors that affect prices in the short run.

The Bank recognizes that the inflation rate consistent with price stability on a sustainable basis will rise as efforts by a wide range of entities toward strengthening competitiveness and growth potential of Japan's economy make progress. Based on this recognition, the Bank sets the price stability target at 2 percent in terms of the year-on-year rate of change in the consumer price index.

Under the price stability target specified above, the Bank will pursue monetary easing and aim to achieve this target at the earliest possible time. Taking into consideration that it will take considerable time before the effects of monetary policy permeate the economy, the Bank will ascertain whether there is any significant risk to the sustainability of economic growth, including from the accumulation of financial imbalances.”

The Bank of Japan also provided explicit analysis of its view on price stability in a “Background note regarding the Bank’s thinking on price stability” (http://www.boj.or.jp/en/announcements/release_2013/data/rel130123a1.pdf http://www.boj.or.jp/en/announcements/release_2013/rel130123a.htm/). The Bank of Japan also amended “Principal terms and conditions for the Asset Purchase Program” (http://www.boj.or.jp/en/announcements/release_2013/rel130122a.pdf): “Asset purchases and loan provision shall be conducted up to the maximum outstanding amounts by the end of 2013. From January 2014, the Bank shall purchase financial assets and provide loans every month, the amount of which shall be determined pursuant to the relevant rules of the Bank.”

Financial markets in Japan and worldwide were shocked by new bold measures of “quantitative and qualitative monetary easing” by the Bank of Japan (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf). The objective of policy is to “achieve the price stability target of 2 percent in terms of the year-on-year rate of change in the consumer price index (CPI) at the earliest possible time, with a time horizon of about two years” (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf). The main elements of the new policy are as follows:

Monetary Base Control. Most central banks in the world pursue interest rates instead of monetary aggregates, injecting bank reserves to lower interest rates to desired levels. The Bank of Japan (BOJ) has shifted back to monetary aggregates, conducting money market operations with the objective of increasing base money, or monetary liabilities of the government, at the annual rate of 60 to 70 trillion yen. The BOJ estimates base money outstanding at “138 trillion yen at end-2012) and plans to increase it to “200 trillion yen at end-2012 and 270 trillion yen at end 2014” (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf).
Maturity Extension of Purchases of Japanese Government Bonds. Purchases of bonds will be extended even up to bonds with maturity of 40 years with the guideline of extending the average maturity of BOJ bond purchases from three to seven years. The BOJ estimates the current average maturity of Japanese government bonds (JGB) at around seven years. The BOJ plans to purchase about 7.5 trillion yen per month (http://www.boj.or.jp/en/announcements/release_2013/rel130404d.pdf). Takashi Nakamichi, Tatsuo Ito and Phred Dvorak, wiring on “Bank of Japan mounts bid for revival,” on Apr 4, 2013, published in the Wall Street Journal (http://online.wsj.com/article/SB10001424127887323646604578401633067110420.html ), find that the limit of maturities of three years on purchases of JGBs was designed to avoid views that the BOJ would finance uncontrolled government deficits.
Seigniorage. The BOJ is pursuing coordination with the government that will take measures to establish “sustainable fiscal structure with a view to ensuring the credibility of fiscal management” (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf).
Diversification of Asset Purchases. The BOJ will engage in transactions of exchange traded funds (ETF) and real estate investment trusts (REITS) and not solely on purchases of JGBs. Purchases of ETFs will be at an annual rate of increase of one trillion yen and purchases of REITS at 30 billion yen.

Table VB-BOJF, Bank of Japan, Forecasts of the Majority of Members of the Policy Board, % Year on Year

Fiscal Year Date of Forecast	Real GDP	CPI All Items Less Fresh Food	Excluding Effects of Consumption Tax Hikes
2013
Oct 2013	+2.6 to +3.0 [+2.7]	+0.6 to +1.0 [+0.7]
Jul 2013	+2.5 to +3.0 [+2.8]	+0.5 to +0.8 [+0.6]
2014
Oct 2013	+0.9 to +1.5 [+1.5]	+2.8 to +3.6 [+3.3]	+0.8 to +1.6 [+1.3]
Jul 2013	+0.8 to +1.5 [+1.3]	+2.7 to +3.6 [+3.3]	+0.7 to +1.6 [+1.3]
2015
Oct 2013	+1.3 to +1.8 [+1.5]	+1.6 to +2.9 [+2.6]	+0.9 to +2.2 [+1.9]
Jul 2013	+1.3 to +1.9 [+1.5]	+1.6 to +2.9 [+2.6]	+0.9 to +2.2 [+1.9]

Figures in brackets are the median of forecasts of Policy Board members

Source: Policy Board, Bank of Japan

http://www.boj.or.jp/en/mopo/outlook/gor1310b.pdf

Private-sector activity in Japan expanded with the Markit Composite Output PMI^™ Index decreased from 56.0 in Oct, which was the highest reading in the six-year history of the survey, to 54.0 in Nov, (http://www.markiteconomics.com/Survey/PressRelease.mvc/84e5de2e85dc4979b44676d284eb3780). Claudia Tillbrooke, Economist at Markit and author of the report, finds that the survey data suggest continuing strong growth of the economy of Japan with strength in new orders for manufacturing (http://www.markiteconomics.com/Survey/PressRelease.mvc/84e5de2e85dc4979b44676d284eb3780). The Markit Business Activity Index of Services decreased from the record of 55.3 in Oct to 51.8 in Nov (http://www.markiteconomics.com/Survey/PressRelease.mvc/84e5de2e85dc4979b44676d284eb3780). Claudia Tillbrooke, Economist at Markit and author of the report, finds growth in services with strength in new orders but concern on possible effects of increase of sale taxes (http://www.markiteconomics.com/Survey/PressRelease.mvc/84e5de2e85dc4979b44676d284eb3780). The Markit/JMMA Purchasing Managers’ Index^™ (PMI™), seasonally adjusted, increased from 54.2 in Oct to 55.1 in Oct, which is the highest level since Jul 2006 (http://www.markiteconomics.com/Survey/PressRelease.mvc/f1337c0c4701495c8d63bc0be72aaa7e). New orders grew at the highest rate in 42 months in anticipation of the increase in the sales tax next year. New export orders increased from Thailand and Hong Kong. Claudia Tillbrooke, Economist at Markit and author of the report, finds improving manufacturing conditions at the highest levels in more 42 months with impulse originating in new orders at home and abroad (http://www.markiteconomics.com/Survey/PressRelease.mvc/f1337c0c4701495c8d63bc0be72aaa7e).Table JPY provides the country data table for Japan.

Table JPY, Japan, Economic Indicators

Historical GDP and CPI	1981-2010 Real GDP Growth and CPI Inflation 1981-2010 Blog 8/9/11 Table 26
Corporate Goods Prices	Nov ∆% 0.1 12 months ∆% 2.7 Blog 12/15/13
Consumer Price Index	Oct NSA ∆% 0.1; Sep 12 months NSA ∆% 1.1 Blog 12/1/13
Real GDP Growth	IIIQ2013 ∆%: 0.3 on IIQ2013; IIIQ2013 SAAR 1.1; ∆% from quarter a year earlier: 2.4 % Blog 6/16/13 8/18/13 9/15/13 11/17/13 12/15/13
Employment Report	Oct Unemployed 2.63 million Change in unemployed since last year: minus 80 thousand Unemployment rate: 4.0 % Blog 12/1/13
All Industry Indices	Sep month SA ∆% 0.4 12-month NSA ∆% 2.2 Blog 11/24/13
Industrial Production	Oct SA month ∆%: 0.5 12-month NSA ∆% 4.7 Blog 12/1/13
Machine Orders	Total Oct ∆% -4.6 Private ∆%: 7.0 Oct ∆% Excluding Volatile Orders 0.6 Blog 12/15/13
Tertiary Index	Oct month SA ∆% -0.7 Oct 12 months NSA ∆% 0.3 Blog 12/15/13
Wholesale and Retail Sales	Oct 12 months: Total ∆%: 1.7 Wholesale ∆%: 1.5 Retail ∆%: 2.3 Blog 12/1/13
Family Income and Expenditure Survey	Oct 12-month ∆% total nominal consumption 2.3, real 0.9 Blog 12/1/13
Trade Balance	Exports Oct 12 months ∆%: 18.6 Imports Oct 12 months ∆% 26.1 Blog 11/24/13

Links to blog comments in Table JPY:

12/1/13 http://cmpassocregulationblog.blogspot.com/2013/12/exit-risks-of-zero-interest-rates-world.html

11/24/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-zero-interest-rates-world.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

9/15/13 http://cmpassocregulationblog.blogspot.com/2013/09/recovery-without-hiring-ten-million.html

8/18/13 http://cmpassocregulationblog.blogspot.com/2013/08/duration-dumping-and-peaking-valuations.html

The economy of Japan grew 0.3 percent in IIIQ2013 after 0.9 percent in IIQ2013 and 1.1 percent in IQ2013, seasonally adjusted, as shown in Table VB-1, incorporating the latest estimates and revisions. Japan’s GDP increased 0.1 percent in IVQ2012 relative to IIIQ2012. IQ2012 GDP growth was revised to 0.9 percent; IIQGDP growth was revised to -0.5 percent; and IIIQ2012 growth was revised to -0.8 percent. The economy of Japan had already weakened in IVQ2010 when GDP fell revised 0.5 percent. As in other advanced economies, Japan’s recovery from the global recession has not been robust. GDP fell 1.8 percent in IQ2011 and fell again 0.7 percent in IIQ2011 as a result of the disruption of the tragic Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Recovery was robust in the first two quarters of 2010 but GDP grew at 1.5 percent in IIIQ2010 and fell 0.5 percent in IVQ2010. The deepest quarterly contractions in the recession were 3.3 percent in IVQ2008 and 4.0 percent in IQ2009.

Table VB-1, Japan, Real GDP ∆% Changes from the Previous Quarter Seasonally Adjusted ∆%

	IQ	IIQ	IIIQ	IVQ
2013	1.1	0.9	0.3
2012	0.9	-0.5	-0.8	0.1
2011	-1.8	-0.7	2.6	0.3
2010	1.4	1.1	1.5	-0.5
2009	-4.0	1.8	0.1	1.8
2008	0.6	-1.1	-1.1	-3.3
2007	1.0	0.2	-0.4	0.9
2006	0.4	0.4	-0.1	1.3
2005	0.2	1.3	0.4	0.2
2004	0.9	0.1	0.1	-0.3
2003	-0.6	1.3	0.4	1.0
2002	-0.2	1.0	0.6	0.4
2001	0.6	-0.2	-1.1	-0.1
2000	1.7	0.2	-0.3	0.7
1999	-0.9	0.4	-0.1	0.4

Source: Japan Economic and Social Research Institute, Cabinet Office

http://www.esri.cao.go.jp/en/sna/sokuhou/sokuhou_top.html

Table VB-2 provides contributions to real GDP at seasonally adjusted annual rates (SAAR). Japan grew at 1.1 percent in IIIQ2013 with contribution of 0.5 percentage points of personal consumption expenditures, 1.6 percentage points of gross fixed capital formation, 0.7 percentage points of private inventory accumulation and 0.2 percent of government consumption. Trade deducted 1.9 percentage points from GDP growth in IIIQ2013. Japan grew at 3.6 percent SAAR in IIQ2013 driven by contributions of 1.6 percent of personal consumption (PC) and 0.6 percent of net trade and gross fixed capital formation (GFCF) at 1.7 percent. In IQ2013, Japan’s GDP increased at the SAAR of 4.5 percent in large part because of 2.4 percent in personal consumption and 1.6 percent in trade. The SAAR of GDP in IVQ2012 was 0.6 percent: 1.4 percentage points from growth of personal consumption expenditures (PC) less 0.6 percentage points of net trade (exports less imports) less 1.4 percentage points of private inventory investment (PINV) plus 0.6 percentage points of government consumption and 0.5 percentage points of gross fixed capital formation (GFCF). The SAAR of GDP in IIIQ2011 was revised to a high 10.6 percent. Net trade deducted from GDP growth in three quarters of 2011 and provided the growth impulse of 3.9 percentage points in IIIQ2011. Growth in 2011 and IQ2012 was driven by personal consumption expenditures that deducted 1.2 percentage points from GDP growth in IIIQ2012 but added 1.4 percentage points to GDP growth in IVQ2012.

Table VB-2, Japan, Contributions to Changes in Real GDP, Seasonally Adjusted Annual Rates (SAAR), %

	GDP	PC	GFCF	Trade	PINV	GOVC
2013
I	4.5	2.4	-0.1	1.6	0.0	0.5
II	3.6	1.6	1.7	0.6	-0.9	0.5
III	1.1	0.5	1.6	-1.9	0.7	0.2
2012
I	3.5	1.0	-0.2	0.4	1.3	1.0
II	-2.0	0.9	0.2	-1.3	-1.3	-0.4
III	-3.2	-1.2	-1.4	-2.1	1.1	0.4
IV	0.6	1.4	0.5	-0.6	-1.4	0.6
2011
I	-7.1	-3.9	-0.1	-1.2	-1.9	-0.1
II	-2.9	2.0	-0.1	-4.3	-0.8	0.3
III	10.6	3.8	1.1	3.9	1.6	0.1
IV	1.2	1.6	3.6	-3.1	-1.2	0.2
2010
I	5.6	1.7	0.2	2.1	2.1	-0.5
II	4.5	-0.2	1.0	0.1	2.5	1.2
III	5.9	3.3	0.8	0.5	1.1	0.3
IV	-1.9	-0.7	-1.0	-0.5	-0.1	0.3
2009
I	-15.2	-1.9	-1.9	-4.4	-7.7	0.7
II	7.2	3.9	-3.2	7.4	-1.7	0.7
III	0.3	0.1	-1.4	2.2	-1.6	1.0
IV	7.2	3.6	0.1	2.7	0.5	0.3
2008
I	2.6	1.5	0.5	1.1	-0.5	-0.1
II	-4.5	-3.3	-2.3	0.5	1.3	-0.8
III	-4.1	-0.5	-0.9	0.0	-2.7	0.0
IV	-12.5	-2.8	-4.6	-11.5	5.8	0.3
2007
I	4.0	0.9	0.6	1.1	1.2	0.4
II	0.6	0.5	-1.5	0.8	0.2	0.5
III	-1.5	-1.0	-1.7	2.0	-0.7	-0.2
IV	3.5	0.3	0.2	1.4	1.0	0.6

Note: PC: Private Consumption; GFCF: Gross Fixed Capital Formation; PINV: Private Inventory; Trade: Net Exports; GOVC: Government Consumption

Source: Japan Economic and Social Research Institute, Cabinet Office

http://www.esri.cao.go.jp/en/sna/sokuhou/sokuhou_top.html

Long-term economic growth in Japan significantly improved by increasing competitiveness in world markets. Net trade of exports and imports is an important component of the GDP accounts of Japan. Table VB-3 provides quarterly data for net trade, exports and imports of Japan. Net trade had strong positive contributions to GDP growth in Japan in all quarters from IQ2007 to IIQ2009 with exception of IVQ2008, IIIQ2008 and IQ2009. The US recession is dated by the National Bureau of Economic Research (NBER) as beginning in IVQ2007 (Dec) and ending in IIQ2009 (Jun) (http://www.nber.org/cycles/cyclesmain.html). Net trade contributions helped to cushion the economy of Japan from the global recession. Net trade deducted from GDP growth in seven of the nine quarters from IVQ2010 IQ2012. The only strong contribution of net trade was 3.9 percent in IIIQ2011. Net trade added 1.6 percentage points to GDP growth in IQ2013 and 0.6 percentage points in IIQ2013 but deducted 1.9 percentage points in IIIQ2013. Private consumption assumed the role of driver of Japan’s economic growth but should moderate as in most mature economies.

Table VB-3, Japan, Contributions to Changes in Real GDP, Seasonally Adjusted Annual Rates (SAAR), %

	Net Trade	Exports	Imports
2013
I	1.6	2.2	-0.7
II	0.6	1.7	-1.1
III	-1.9	-0.4	-1.5
2012
I	0.4	1.6	-1.2
II	-1.3	-0.3	-1.0
III	-2.1	-2.3	0.2
IV	-0.6	-1.8	1.2
2011
I	-1.2	-0.5	-0.7
II	-4.3	-4.7	0.4
III	3.9	5.8	-1.9
IV	-3.1	-1.9	-1.2
2010
I	2.1	3.4	-1.3
II	0.1	2.7	-2.6
III	0.5	1.4	-0.9
IV	-0.5	0.1	-0.5
2009
I	-4.4	-16.4	12.0
II	7.4	4.7	2.7
III	2.2	5.2	-3.0
IV	2.7	4.1	-1.4
2008
I	1.1	2.1	-1.0
II	0.5	-1.6	2.1
III	0.0	0.2	-0.1
IV	-11.5	-10.2	-1.3
2007
I	1.1	1.7	-0.5
II	0.8	1.6	-0.8
III	2.0	1.4	0.6
IV	1.4	2.1	-0.7

Source: Japan Economic and Social Research Institute, Cabinet Office

http://www.esri.cao.go.jp/en/sna/sokuhou/sokuhou_top.html

Japan’s percentage growth of GDP not seasonally adjusted in a quarter relative to the same quarter a year earlier is shown in Table VB-4. Contraction of GDP in a quarter relative to the same quarter a year earlier extended over seven quarters from IIQ2008 through IVQ2009. Contraction was sharpest in IQ2009 with output declining 9.4 percent relative to a year earlier. Yearly quarterly rates of growth of Japan were relatively high for a mature economy through the decade with the exception of the contractions from IVQ2001 to IIQ2002 and after 2007. The Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011 caused flat GDP in IQ2011 at 0.1 percent relative to the same quarter a year earlier and decline of 1.5 percent in IIQ2011. GDP fell 0.5 percent in IIIQ2011 relative to a year earlier and changed 0.0 percent in IVQ2011 relative to a year earlier. Growth resumed with 3.1 percent in IQ2012 relative to a year earlier. Growth of 3.2 percent in IIQ2012 is largely caused by the low level in IIQ2011 resulting from the Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. GDP decreased 0.2 percent in IIIQ2012 relative to a year earlier and 0.3 percent in IVQ2012 relative to a year earlier. GDP grew 0.1 percent in IQ2013 relative to a year earlier and 1.2 percent in IIQ2013. Growth of 2.4 percent in IIIQ2013 relative to a year earlier is partly due to the decline of 0.8 percent in GDP in IIIQ2013. Japan faces the challenge of recovery from the devastation of the Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011 in an environment of declining world trade and bouts of risk aversion that cause appreciation of the Japanese yen that erode the country’s competitiveness in world markets.

Table VB-4, Japan, Real GDP ∆% Changes from Same Quarter Year Earlier, NSA ∆%

	IQ	IIQ	IIIQ	IVQ
2013	0.1	1.2	2.4
2012	3.1	3.2	-0.2	-0.3
2011	0.1	-1.5	-0.5	0.0
2010	4.9	4.4	6.0	3.3
2009	-9.4	-6.6	-5.6	-0.5
2008	1.4	-0.1	-0.6	-4.7
2007	2.8	2.3	2.0	1.6
2006	2.6	1.3	0.9	2.0
2005	0.4	1.4	1.5	1.9
2004	4.0	2.6	2.2	0.7
2003	1.7	1.8	1.5	1.8
2002	-1.6	-0.2	1.4	1.6
2001	1.6	0.9	0.0	-1.0
2000	2.7	2.4	2.2	1.8
1999	-0.3	0.1	-0.1	-0.5

Source: Japan Economic and Social Research Institute, Cabinet Office

http://www.esri.cao.go.jp/en/sna/sokuhou/sokuhou_top.html

The tertiary activity index of Japan decreased 0.7 percent SA in Oct 2013 and increased 0.3 percent NSA in the 12 months ending in Oct 2013, as shown in Table VB-5. The index is showing significant volatility with increases of 1.3 percent in Feb 2013 and 1.2 percent in May 2013 but decreases in multiple months. The tertiary activity index fell 5.2 percent in 2009, growing 1.3 percent in 2010, 0.1 percent in 2011 and 1.4 percent in 2012.

Table VB-5, Japan, Tertiary Activity Index, ∆%

	Month ∆% SA	12 Months ∆% NSA
Oct 2013	-0.7	0.3
Sep	0.0	1.3
Aug	0.6	0.7
Jul	-0.4	1.3
Jun	-0.7	0.5
May	1.2	1.7
Apr	-0.5	1.3
Mar	0.2	0.7
Feb	1.3	-1.6
Jan	-0.8	0.1
Dec 2012	0.2	-0.1
Nov	-0.1	1.0
Oct	0.2	1.3
Sep	0.0	0.1
Aug	0.2	0.6
Jul	-0.3	0.8
Jun	0.0	0.8
May	0.5	3.1
Apr	-0.2	2.4
Mar	-0.3	4.2
Feb	0.2	2.4
Jan	-0.8	0.3
Calendar Year
2012		1.4
2011		0.1
2010		1.3
2009		-5.2
2008		-1.0
2007		1.0
2006		1.8
2005		1.9
2004		1.8

Source: Japan, Ministry of Economy, Trade and Industry (METI)

http://www.meti.go.jp/english/statistics/index.html

Month and 12-month rates of growth of the tertiary activity index of Japan and components in Oct 2013 are provided in Table VB-6. Electricity, gas, heat supply and water increased 3.6 percent in Oct 2013 and increased 0.7 percent in the 12 months ending in Oct 2013. Wholesale and retail trade decreased 0.3 percent in the month of Oct and decreased 1.8 percent in 12 months. Information and communications decreased 0.7 percent in Oct and increased 3.2 percent in 12 months.

Table VB-6, Japan, Tertiary Index and Components, Month and 12-Month Percentage Changes ∆%

Oct 2013	Weight	Month ∆% SA	12 Months ∆% NSA
Tertiary Index	10,000.0	0.3	-0.7
Electricity, Gas, Heat Supply & Water	372.9	3.6	0.7
Information & Communications	951.2	-0.7	3.2
Wholesale & Retail Trade	2,641.2	-0.3	-1.8
Finance & Insurance	971.1	-1.9	4.1
Real Estate & Goods Rental & Leasing	903.4	-2.1	-1.2
Scientific Research, Professional & Technical Services	551.3	-0.3	3.4
Accommodations, Eating, Drinking	496.0	-1.9	-1.8
Living-Related, Personal, Amusement Services	552.7	-1.5	-1.4
Learning Support	116.9	0.0	-0.7
Medical, Health Care, Welfare	921.1	0.3	1.3
Miscellaneous ex Government	626.7	-1.5	-2.8

Source: Japan, Ministry of Economy, Trade and Industry (METI)

http://www.meti.go.jp/english/statistics/index.html

Japan’s total machinery orders seasonally adjusted in Table VB-7 declined in Oct 2013, decreasing 4.6 percent seasonally adjusted. Private sector orders increased 7.0 percent and 0.6 percent excluding volatile orders. Orders from overseas decreased 16.0 percent and manufacturing orders 0.2 percent. Government orders decreased 26.2 percent.

Table VB-7, Japan, Machinery Orders, Month ∆%, SA

2013	Oct 13	Sep 13	Aug 13	Jul 13
Total	-4.6	13.2	4.5	4.4
Private Sector	7.0	-0.9	3.2	3.4
Excluding Volatile Orders	0.6	-2.1	5.4	0.0
Mfg	-0.2	4.1	0.8	4.8
Non Mfg ex Volatile	11.5	-7.0	6.2	0.0
Government	-26.2	42.9	-8.3	12.9
From Overseas	-16.0	12.1	22.4	1.4
Through Agencies	13.2	-4.2	2.4	-3.0

Note: Mfg: manufacturing

Source: Japan Economic and Social Research Institute, Cabinet Office

Total orders for machinery and total private-sector orders excluding volatile orders for Japan are shown in Chart VB-1 of Japan’s Economic and Social Research Institute at the Cabinet Office. The trend of private-sector orders excluding volatile orders was showing recovery from the drop after Mar 2011 because of the earthquake/tsunami. There was reversal of the trend of increase in total orders with recent decreases and an upward movement in the final data point. Fluctuations still prevent detecting longer-term trends but recovery is still evident from the global recession. There was a major setback by the declines in May 2012 shown in the final segment of Chart VB-1 with partial recovery in Jun 2012, decline again in Jul and Aug 2012 and rebound in total orders in Nov reversed in Dec but decline in orders excluding volatile segments with increase in Nov-Dec 2012. The final segment shows growth in Feb-Mar 2013 interrupted by decline in Apr 2013 followed by increase in May 2013. Orders fell again in Jun 2013, rebounding in Jul-Sep 2013 followed by another fall in Oct 2013.

Chart VB-1, Japan, Machinery Orders

Source: Japan Economic and Social Research Institute, Cabinet Office

Table VB-8 provides values and percentage changes from a year earlier of Japan’s machinery orders without seasonal adjustment. Total orders of JPY 1,929,486 million in Sep 2013 are divided between JPY 772,053 million overseas orders, or 40.0 percent of the total, and domestic orders of JPY 1,052,984 million, or 54.6 percent of the total, with orders through agencies of JPY 104,449 million, or 5.4 percent of the total. Orders through agencies are not in Table VB-8 because of the minor value and appear only in the note to the table. Twelve-month percentages changes in Oct 2013 continued strongly with increases of 24.6 percent for total orders, 21.4 percent for domestic orders and 17.8 percent for orders excluding volatile components. Overseas orders rose 29.7 percent in 12 months partly because of yen devaluation.

Table VB-8, Japan, Machinery Orders, 12 Months ∆% and Million Yen, Original Series

	Total	Overseas	Domestic	Private ex Volatile
Value Oct 2013	1,929,486	772,053	1,052,984	734,202
% Total	100.0	40.0	54.6	38.1
Value Oct 2012	1,548,219	595,251	867,272	623,340
% Total	100.0	38.4	56.0	39.4
12-month ∆%	24.6	29.7	21.4	17.8
Oct 2013	24.6	29.7	21.4	17.8
Sep 2013	30.3	57.4	18.4	11.4
Aug 2013	25.9	41.8	17.1	10.3
Jul 2013	5.3	4.4	6.9	6.5
Jun 2013	2.7	0.1	4.1	4.9
May 2013	18.1	17.1	20.8	16.5
Apr 2013	-4.3	6.7	-9.9	-1.1
Mar 2013	11.5	27.5	3.3	2.4
Feb 2013	-14.8	-21.0	-10.7	-11.3
Jan 2013	-24.8	-36.7	-11.8	-9.7
Dec 2012	-12.5	-24.1	-3.3	-3.4
Nov 2012	-8.6	-9.6	-8.5	0.3
Oct 2012	-6.9	-12.8	-2.6	1.2
Sep 2012	-7.8	-18.4	-1.8	-7.8
Aug 2012	-18.6	-31.1	-10.2	-6.1
Jul 2012	2.6	-1.9	3.2	1.7
Jun 2012	-10.9	-11.3	-12.4	-9.9
May 2012	-6.8	-7.0	-8.6	1.0
Apr 2012	7.5	-9.6	23.0	6.6
Mar 2012	8.1	-10.0	19.0	-1.1
Feb 2012	-9.3	-8.9	-11.2	8.9
Jan 2012	9.8	18.3	0.5	5.7
Dec 2011	0.8	12.6	-8.5	6.3
Nov 2011	11.0	8.0	13.5	12.5
Oct 2011	-6.8	-15.6	-1.0	1.5
Dec 2010	9.4	3.5	14.1	-0.6
Dec 2009	1.8	0.4	3.6	-1.9
Dec 2008	-23.3	-29.4	-17.4	-24.7
Dec 2007	1.3	9.8	-4.3	-6.4
Dec 2006	0.8	0.9	-0.1	0.1

Note: Total machinery orders = overseas + domestic demand + orders through agencies. Orders through agencies in Oct 2013 were JPY 104,449 million or 5.4 percent of the total and JPY 85,696 or 5.5 percent of the total in Oct 2012, and are not shown in the table. The data are the original numbers without any adjustments and differ from the seasonally adjusted

VC China. China estimates an index of nonmanufacturing purchasing managers on the basis of a sample of 1200 nonmanufacturing enterprises across the country (http://www.stats.gov.cn/english/pressrelease/t20121009_402841094.htm). Table CIPMNM provides this index and components. The index fell from 58.0 in Mar 2012 to 55.2 in May but climbed to 56.7 in Jun, which is lower than 58.0 in Mar and 57.3 in Feb but higher than in any other of the months in 2012. In Jul 2012 the index fell marginally to 55.6 and then to 56.3 in Aug and 53.7 in Sep but rebounded to 55.5 in Oct and 55.6 in Nov 2012. Improvement continued with 56.1 in Dec 2012 and 56.2 in Jan 2013, declining marginally to 54.5 in Feb 2013 and 55.6 in Mar 2013. The index fell to 54.5 in Apr 2013, 54.3 in May 2013 and 53.9 in Jun 2013, rebounding to 54.1 in Jul 2013. The index eased to 53.9 in Aug 2013. The index increased to 55.4 in Sep 2013 and 56.3 in Oct 2013.

Table CIPMNM, China, Nonmanufacturing Index of Purchasing Managers, %, Seasonally Adjusted

	Total Index	New Orders	Interm. Input Prices	Subs Prices	Exp
Oct 2013	56.3	51.6	56.1	51.4	60.5
Sep	55.4	53.4	56.7	50.6	60.1
Aug	53.9	50.9	57.1	51.2	62.9
Jul	54.1	50.3	58.2	52.4	63.9
Jun	53.9	50.3	55.0	50.6	61.8
May	54.3	50.1	54.4	50.7	62.9
Apr	54.5	50.9	51.1	47.6	62.5
Mar	55.6	52.0	55.3	50.0	62.4
Feb	54.5	51.8	56.2	51.1	62.7
Jan	56.2	53.7	58.2	50.9	61.4
Dec 2012	56.1	54.3	53.8	50.0	64.6
Nov	55.6	53.2	52.5	48.4	64.6
Oct	55.5	51.6	58.1	50.5	63.4
Sep	53.7	51.8	57.5	51.3	60.9
Aug	56.3	52.7	57.6	51.2	63.2
Jul	55.6	53.2	49.7	48.7	63.9
Jun	56.7	53.7	52.1	48.6	65.5
May	55.2	52.5	53.6	48.5	65.4
Apr	56.1	52.7	57.9	50.3	66.1
Mar	58.0	53.5	60.2	52.0	66.6
Feb	57.3	52.7	59.0	51.2	63.8
Jan	55.7	52.2	58.2	51.1	65.3

Notes: Interm.: Intermediate; Subs: Subscription; Exp: Business Expectations

Source: National Bureau of Statistics of China

Chart CIPMNM provides China’s nonmanufacturing purchasing managers’ index. There was slowing of the general index in Apr 2012 after the increase in Jan-Mar 2012 and further decline to 55.2 in May 2012 but increase to 56.7 in Jun 2012 with marginal decline to 55.6 in Jul 2012 and 56.3 in Aug 2012 and sharper drop to 53.7 in Sep 2012, rebounding to 55.5 in Oct 2012, 55.6 in Nov 2012, 56.1 in Dec 2012 and 55.6 in Mar 2013. The index fell again to 54.5 in Apr 2013, 54.3 in May 2013 and 53.9 in Jun 2013, rebounding to 54.1 in Jul 2013. The index stabilized at 53.9 in Aug 2013 climbing to 55.4 in Sep 2013 and 56.3 in Oct 2013.

Chart CIPMNM, China, Nonmanufacturing Index of Purchasing Managers, Seasonally Adjusted

Source: National Bureau of Statistics of China

Table CIPMMFG provides the index of purchasing managers of manufacturing seasonally adjusted of the National Bureau of Statistics of China. The general index (IPM) rose from 50.5 in Jan 2012 to 53.3 in Apr and declined to 50.1 in Jul and to the contraction zone at 49.2 in Aug and 49.8 in Sep, climbing above 50.0 to 50.2 in Oct, 50.6 in Nov-Dec 2012, 50.9 in Mar 2013 and 50.6 in Apr 2013. The index increased to 50.8 in May 2013, falling to 50.1 in Jun 2013 and rebounding to 50.3 in Jul 2013. The index increased to 51.0 in Aug 2013 and 51.1 in Sep 2013 with marginal improvement to 51.4 in Oct 2013. The index of new orders (NOI) fell from 54.5 in Apr 2012 to 49.0 in Jul and 48.7 in Aug, climbing above 50.0, 51.2 in Nov 2012-Dec 2012, 52.3 in Mar 2013 and 51.7 in Apr 2013. The index of new orders increased to 51.8 in May 2013, falling to 50.4 in Jun 2013 and 50.6 in Jul 2013. The index of new orders increased to 52.4 in Aug 2013 and 52.8 in Sep 2013 with marginal decline to 52.5 in Oct 2013. The index of employment also fell from 51.0 in Apr to 49.1 in Aug and further down to 48.7 in Nov 2012, 49.9 in Dec 2012, 49.8 in Mar 2013 and 49.0 in Apr 2013. The index of employment fell to 48.8 in May 2013 and 48.7 in Jun 2013, increasing to 49.1 in Jul 2013. The index of employment increased to 49.3 in Aug 2013 and fell to 49.1 in Sep 2013 with marginal improvement to 49.2 in Oct 2013.

Table CIPMMFG, China, Manufacturing Index of Purchasing Managers, %, Seasonally Adjusted

	IPM	PI	NOI	INV	EMP	SDEL
Oct 2013	51.4	54.4	52.5	48.6	49.2	50.8
Sep	51.1	52.9	52.8	48.5	49.1	50.8
Aug	51.0	52.6	52.4	48.0	49.3	50.4
Jul	50.3	52.4	50.6	47.6	49.1	50.1
Jun	50.1	52.0	50.4	47.4	48.7	50.3
May	50.8	53.3	51.8	47.6	48.8	50.8
Apr	50.6	52.6	51.7	47.5	49.0	50.8
Mar	50.9	52.7	52.3	47.5	49.8	51.1
Feb	50.1	51.2	50.1	49.5	47.6	48.3
Jan	50.4	51.3	51.6	50.1	47.8	50.0
Dec 2012	50.6	52.0	51.2	47.3	49.0	48.8
Nov	50.6	52.5	51.2	47.9	48.7	49.9
Oct	50.2	52.1	50.4	47.3	49.2	50.1
Sep	49.8	51.3	49.8	47.0	48.9	49.5
Aug	49.2	50.9	48.7	45.1	49.1	50.0
Jul	50.1	51.8	49.0	48.5	49.5	49.0
Jun	50.2	52.0	49.2	48.2	49.7	49.1
May	50.4	52.9	49.8	45.1	50.5	49.0
Apr	53.3	57.2	54.5	48.5	51.0	49.6
Mar	53.1	55.2	55.1	49.5	51.0	48.9
Feb	51.0	53.8	51.0	48.8	49.5	50.3
Jan	50.5	53.6	50.4	49.7	47.1	49.7

IPM: Index of Purchasing Managers; PI: Production Index; NOI: New Orders Index; EMP: Employed Person Index; SDEL: Supplier Delivery Time Index

Source: National Bureau of Statistics of China

China estimates the manufacturing index of purchasing managers on the basis of a sample of 820 enterprises (http://www.stats.gov.cn/english/pressrelease/t20121009_402841094.htm). Chart CIPMMFG provides the manufacturing index of purchasing managers. There is deceleration from 51.2 in Sep 2011 to marginal contraction at 49.0 in Nov 2011. Manufacturing activity recovered to 53.3 in Apr 2012 but then declined to 50.4 in May 2012 and 50.1 in Jun 2012, which is the lowest in a year with exception of contraction at 49.0 in Nov 2011. The index then fell to contraction at 49.2 in Aug 2012 and improved to 49.8 in Sep with movement to 50.2 in Oct 2012, 50.6 in Nov 2012, 50.9 in Mar 2013 and 50.6 in Apr 2013 above the neutral zone of 50.0. The index increased to 50.8 in May 2013 and fell to 50.1 in Jun 2013, increasing to 50.3 in Jul 2013. The index increased to 51.0 in Aug 2013, 51.1 in Sep 2013 and 51.4 in Oct 2013.

Chart CIPMMFG, China, Manufacturing Index of Purchasing Managers, Seasonally Adjusted

Source: National Bureau of Statistics of China

10/27/13 http://cmpassocregulationblog.blogspot.com/2013/10/twenty-eight-million-unemployed-or.html

Cumulative growth of China’s GDP in IIIQ2013 relative to the same period in 2012 was 7.7 percent, as shown in Table VC-GDP. Secondary industry accounts for 45.3 percent of GDP in IIIQ2013. In IIQ2013, industry alone accounts for 38.5 percent in IIQ2013 and construction with the remaining 6.8 percent in the first three quarters of 2012. Tertiary industry accounts for 45.5 percent of cumulative GDP in IIIQ2013 and primary industry for 9.2 percent. China’s growth strategy consisted of rapid increases in productivity in industry to absorb population from agriculture where incomes are lower (Pelaez and Pelaez, The Global Recession Risk (2007), 56-80). The bottom block of Table VC-GDP provides quarter-on-quarter growth rates of GDP and their annual equivalent. China’s GDP growth decelerated significantly from annual equivalent 10.8 percent in IIQ2011 to 7.4 percent in IVQ2011 and 5.7 percent in IQ2012, rebounding to 9.1 percent in IIQ2012, 8.2 percent in IIIQ2012 and 7.8 percent in IVQ2012. Annual equivalent growth in IQ2013 fell to 6.1 percent and to 7.8 percent in IIQ2013, rebounding to 9.1 percent in IIIQ2013.

Table VC-GDP, China, Quarterly Growth of GDP, Current CNY 100 Million and Inflation Adjusted ∆%

Cumulative GDP IIIQ2013	Value Current CNY Billion	2013 Year-on-Year Constant Prices ∆%
GDP	38,676.2	7.7
Primary Industry	3,566.9	3.4
Farming	3,566.9	3.4
Secondary Industry	17,511.8	7.8
Industry	14,900.0	7.6
Construction	2,611.8	9.7
Tertiary Industry	17,597.5	8.4
Transport, Storage, Post	21,449.9	7.2
Wholesale, Retail Trades	3,056.7	10.4
Hotel & Catering Services	772.7	5.1
Financial Intermediation	2,623.8	10.4
Real Estate	2,454.6	7.3
Other	6,094.8	7.6
Growth in Quarter Relative to Prior Quarter	∆% on Prior Quarter	∆% Annual Equivalent
2013
IIIQ2013	2.2	9.1
IIQ2013	1.9	7.8
IQ2013	1.5	6.1
2012
IVQ2012	1.9	7.8
IIIQ2012	2.0	8.2
IIQ2012	2.2	9.1
IQ2012	1.4	5.7
2011
IVQ2011	1.8	7.4
IIIQ2011	2.2	9.1
IIQ2011	2.6	10.8
IQ2011	2.3	9.5

Source: National Bureau of Statistics of China http://www.stats.gov.cn/english/

Growth of China’s GDP in IIIQ2013 relative to the same period in 2012 was 7.8 percent, as shown in Table VC-GDPA. Secondary industry accounts for 45.3 percent of GDP of which industry alone for 38.5 percent in cumulative IIIQ2013 and construction with the remaining 6.8 percent in the first three quarters of 2013. Tertiary industry accounts for 45.5 percent of GDP in the cumulative to IIIQ2013 and primary industry for 9.2 percent. China’s growth strategy consisted of rapid increases in productivity in industry to absorb population from agriculture where incomes are lower (Pelaez and Pelaez, The Global Recession Risk (2007), 56-80). GDP growth decelerated from 12.1 percent in IQ2010 and 11.2 percent in IIQ2010 to 7.7 percent in IQ2013, 7.5 percent in IIQ2013 and 7.8 percent in IIIQ2013.

Table VC-GDPA, China, Growth Rate of GDP, ∆% Relative to a Year Earlier and ∆% Relative to Prior Quarter

	IQ 2013	IIQ 2013	IIIQ 2013
GDP	7.7	7.5	7.8
Primary Industry	3.4	3.0	3.4
Secondary Industry	7.8	7.6	7.8
Tertiary Industry	8.3	8.3	8.4
GDP ∆% Relative to a Prior Quarter	1.5	1.9	2.2
	IQ 2011	IIQ 2011	IIIQ 2011	IVQ 2011	IQ 2012	IIQ 2012	IIIQ 2012	IVQ 2012
GDP	9.7	9.5	9.1	8.9	8.1	7.6	7.4	7.9
Primary Industry	3.5	3.2	3.8	4.5	3.8	4.3	4.2	4.5
Secondary Industry	11.1	11.0	10.8	10.6	9.1	8.3	8.1	8.1
Tertiary Industry	9.1	9.2	9.0	8.9	7.5	7.7	7.9	8.1
GDP ∆% Relative to a Prior Quarter	2.3	2.6	2.2	1.8	1.4	2.2	2.0	1.9
	IQ 2010	IIQ 2010	IIIQ 2010	IVQ 2010
GDP	12.1	11.2	10.7	12.1
Primary Industry	3.8	3.6	4.0	3.8
Secondary Industry	14.5	13.3	12.6	14.5
Tertiary Industry	10.5	9.9	9.7	10.5

Source: National Bureau of Statistics of China http://www.stats.gov.cn/english/

Chart VC-GDP of the National Bureau of Statistics of China provides annual value and growth rates of GDP. China’s GDP growth in 2012 is still high at 7.8 percent but at the lowest rhythm in five years

Chart VC-GDP, China, Gross Domestic Product, Million Yuan and ∆%, 2008-2012

Source: National Bureau of Statistics of China http://www.stats.gov.cn/english/

The HSBC Flash China Manufacturing Purchasing Managers’ Index^™ (PMI^™) compiled by Markit (http://www.markiteconomics.com/Survey/PressRelease.mvc/982f1d1602014fc4a5f7ef4b4394f8e3) is slowing. The overall Flash HSBC China Manufacturing PMI^™ decreased from 50.9 in Oct to 50.4 in Nov, which is moderately above the contraction frontier of 50.0, while the Flash HSBC China Manufacturing Output Index decreased from 51.3 in Oct to 51.1 in Nov, moving into moderate expansion territory. Hongbin Qu, Chief Economist, China and Co-Head of Asian Economic Research at HSBC, finds that the flash manufacturing index slowed because of weakness in new export orders and replenishment of stocks (http://www.markiteconomics.com/Survey/PressRelease.mvc/982f1d1602014fc4a5f7ef4b4394f8e3). The HSBC China Services PMI^™, compiled by Markit, shows marginal improvement in business activity in China with the HSBC Composite Output, combining manufacturing and services, increasing from 51.8 in Oct to 52.3 in Nov, indicating moderate growth (http://www.markiteconomics.com/Survey/PressRelease.mvc/a7d6f88e711a42a09011498c599785ca). Hongbin Qu, Chief Economist, China and Co-Head of Asian Economic Research at HSBC, finds support of manufacturing combined with services (http://www.markiteconomics.com/Survey/PressRelease.mvc/a7d6f88e711a42a09011498c599785ca). The HSBC Business Activity index decreased from 52.6 in Oct to 52.5 in Nov (http://www.markiteconomics.com/Survey/PressRelease.mvc/a7d6f88e711a42a09011498c599785ca). Hongbin Qu, Chief Economist, China & Co-Head of Asian Economic Research at HSBC, finds softening growth (http://www.markiteconomics.com/Survey/PressRelease.mvc/a7d6f88e711a42a09011498c599785ca). The HSBC Purchasing Managers’ Index^™ (PMI^™), compiled by Markit, decreased marginally to 50.8 in Nov from 50.9 in Oct, indicating marginally improving manufacturing in China (http://www.markiteconomics.com/Survey/PressRelease.mvc/da14ac24941a473da5054be514db9e47). New export orders increased marginally with growth of total new orders originating in domestic demand. Hongbin Qu, Chief Economist, China and Co-Head of Asian Economic Research at HSBC, finds China moving in the path of moderate recovery of growth (http://www.markiteconomics.com/Survey/PressRelease.mvc/da14ac24941a473da5054be514db9e47). Table CNY provides the country data table for China.

Table CNY, China, Economic Indicators

Price Indexes for Industry	Nov 12-month ∆%: minus 2.0 Nov month ∆%: 0.0 Blog 12/15/13
Consumer Price Index	Nov month ∆%: -0.1 Nov 12 months ∆%: 3.0 Blog 12/15/13
Value Added of Industry	Nov month ∆%: 0.76 Jan-Nov 2013/Jan-No 2012 ∆%: 9.7 Nov 12-Month ∆%: 10.0 Blog 12/15/13
GDP Growth Rate	Year IIIQ2013 ∆%: 7.8 Quarter IIQ2013 AE ∆%: 9.1 Blog 10/27/13
Investment in Fixed Assets	Total Jan-Nov 2013 ∆%: 19.9 Real estate development: 19.5 Blog 12/15/13
Retail Sales	Nov month ∆%: 1.32 Nov 12 month ∆%: 13.7 Jan-No ∆%: 13.0 Blog 12/15/13
Trade Balance	Nov balance $33.8 billion Exports 12M ∆% 12.7 Imports 12M ∆% 5.3 Cumulative Nov: $234.27 billion Blog 12/15/13

Links to blog comments in Table CNY:

Cumulative and 12-months rates of value added of industry in China are provided in Table VC-1. Value added of industry increased 9.7 percent in Jan-Nov 2013 relative to a year earlier and 10.0 percent in the 12 months ending in Nov 2013. Industry’s value added increased 9.7 percent in Jan-Oct 2013 relative to the same period a year earlier and 10.3 percent in the 12 months ending in Oct 2013. Value added in total industry increased 9.6 in Jan-Sep 2013 relative to a year earlier and 10.2 percent in 12 months. Value added in total industry in Jan-Aug 2013 increased 9.5 percent relative to a year earlier. Heavy industry (manufacturing) had been the driver of growth with a cumulative rate of 10.0 percent relative to a year earlier in Jan-Mar 2012 that declined to 10.5 percent in Jan-Apr 2012 relative to the same period a year earlier and further down to 10.1 percent in Jan-Jun 2012, 9.9 percent in Jan-Jul 2012, 9.8 percent in Jan-Aug 2012, 9.7 percent in Jan-Sep 2012, 9.7 percent in Jan-Oct 2012, 9.8 percent in Jan-Nov 2012, 9.9 percent in Jan-Dec 2012, 10.2 percent in Jan-Feb 2013, 9.8 percent in Jan-Mar 2013, 9.7 percent in Jan-Apr 2013, 9.7 percent in Jan-May 2013, 10.0 percent in Jan-Jun 2013, 10.1 percent in Jan-Jul 2013 and 10.2 percent in Jan-Aug 2013. The rate for heavy industry increased marginally to 10.3 percent in Jan-Sep 2013. Light industry (mining and quarrying) grew 6.7 percent in Jan-Sep 2013 relative to a year earlier. Growth of total industry decelerated from cumulative 14.4 percent in Jan-Mar 2011 to 9.6 percent in Jan-Sep 2013.

Table VC-1, China, Growth Rate of Value Added of Industry ∆%

	Industry	Light Industry	Heavy Industry	State Owned	Joint-Stock
2013
Jan-Nov	9.7	6.4	10.5	6.8	4.4
12M Nov	10.0	5.6	11.0	9.1	2.4
Jan-Oct	9.7	6.5	10.4	6.5	11.0
12M Oct	10.3	4.3	11.4	8.4	11.1
Jan-Sep	9.6	6.7	10.3	6.3	11.0
12M Sep	10.2	4.9	11.1	7.8	11.1
Jan-Aug	9.5	6.9	10.2	6.1	11.0
12M Aug	10.4	5.8	10.9	9.5	11.7
Jan-Jul	9.4	7.1	10.1	5.6	10.9
12M Jun	9.7	5.5	10.5	8.1	11.1
Jan-Jun	9.3	7.3	10.0	5.2	10.9
12M Jun	8.9	5.8	9.6	6.3	10.5
Jan-May	9.4	8.5	9.7	4.9	11.0
12M May	9.2	8.0	9.8	4.4	10.7
Jan-Apr	9.4	8.6	9.7	4.9	11.1
12 M Apr	9.3	8.5	9.6	4.3	10.9
Jan-Mar	9.5	8.7	9.8	5.2	11.3
12 M Mar	8.9	8.2	9.1	4.3	11.0
Jan-Feb	9.9	9.1	10.2	5.8	11.4
2012
Jan-Dec 2012	10.0	10.1	9.9	6.4	11.8
12 M Dec	10.3	9.6	10.6	8.0	12.1
Jan-Nov	10.0	10.2	9.8	6.3	11.8
12 M Nov	10.1	9.2	10.5	7.2	11.8
Jan-Oct	10.0	10.3	9.7	6.4	11.8
12 M Oct	9.6	9.1	9.7	7.0	11.7
Jan-Sep	10.0	10.4	9.7	6.3	11.8
12 M Sep	9.2	9.0	9.3	6.3	11.0
Jan-Aug	10.1	10.5	9.8	6.3	15.4
12 M Aug	8.9	8.6	9.0	5.3	14.3
Jan-Jul	10.3	10.8	9.9	6.6	12.1
12 M Jul	9.2	10.1	8.8	4.8	10.9
Jan-Jun	10.5	11.1	10.1	7.0	12.4
12 M Jun	9.5	9.0	9.6	6.5	11.5
Jan-May	10.7	11.5	10.3	6.7	12.4
12 M May	9.6	9.1	9.8	6.6	11.0
Jan-Apr	11.0	12.3	10.5	6.6	12.9
12 M Apr	9.3	10.3	8.9	4.3	10.7
Jan-Mar	11.6	13.2	11.0	7.2	13.8
12 M Mar	11.9	13.9	11.2	8.0	13.7
Jan-Feb	11.4	12.7	10.9	7.3	13.9
2011
Jan-Dec	13.9	13.0	14.3	9.9	15.8
12 M Dec	12.8	12.6	13.0	9.2	14.7
Jan-Nov	14.0	13.0	14.4	9.9	16.0
12 M Nov	12.4	12.4	12.4	7.8	14.4
Jan-Oct	14.1	13.0	14.5	10.1	9.1
12 M Oct	13.2	12.1	13.7	8.9	15.1
Jan-Sep	14.2	13.1	14.6	10.4	16.1
12 M Sep	13.8	12.8	14.3	9.9	16.0
Jan-Aug	14.2	13.1	14.6	10.4	16.1
12 M Aug	13.5	13.4	13.5	9.4	15.5
Jan-Jul	14.3
12 M Jul	14.0	12.8	14.5	9.5
Jan-Jun	14.3	13.1	14.7	10.7	19.7
12 M Jun	15.1	13.9	15.6	10.7	20.8
Jan-May	14.0	12.9	14.4	10.7	19.3
12 M May	13.3	12.9	13.5	8.9	18.7
Jan-Apr	14.2	12.9	14.7	11.2	19.5
12 M Apr	13.4	11.9	14.0	10.4	18.0
Jan-Mar	14.4	13.1	14.9	11.4	19.8
12 M Mar	14.8	12.8	15.6	12.9	19.2
12 M Feb	14.9	13.1	15.6	10.5	21.7
Jan-Feb	14.1	13.3	14.4	10.6	20.3

*After Jun 2013 Heavy Industry is Manufacturing and Light Industry is Mining and Quarrying

Source: National Bureau of Statistics of China

Chart VC-1 provides 12-month percentage changes of value added of industry in 2012 and from Jan to Jul 2013. Growth rates of value added of industry in the first five months of 2010 were higher than in 2011 as would be expected in an earlier phase of recovery from the global recession. Growth rates have converged in the second half of 2011 to lower percentages with further decline into 2012 to single digit percentage changes, 10.3 percent in Dec 2012, 8.9 percent in Mar 2013 and 9.3 percent in Apr 2013. The growth rate eased to 9.2 percent in May 2013 and 8.9 percent in Jun 2013, rebounding to 9.7 percent in Jul 2013. The rate of growth increased to 10.4 percent in Aug 2013 and fell marginally to 10.2 percent in Sep 2013. There is recovery to 10.3 percent in Oct 2013, easing to 10.0 percent in Nov 2013.

Chart VC-1, China, Growth Rate of Total Value Added of Industry, 12-Month ∆%

Source: National Bureau of Statistics of China

Yearly rates of growth for the past 12 months and cumulative relative to the earlier year of various segments of industrial production in China are provided in Table VC-2. Rates from Jan to Dec 2011 relative to the same period a year earlier fluctuated but remained mostly above 10 percent with the exception of motor vehicles and crude oil. There is deceleration in Jan-Dec 2012 of percentage change with no segment showing growth exceeding 10 percent with exception of 12-month growth of 13.5 percent for pig iron and 16.7 percent for nonferrous metals. In Jan-Sep 2013, many segments grew at rates exceeding or around 10 percent with exception of electricity at 6.8 percent, crude oil at 4.2 percent and pig iron at 6.9 percent. Electricity fell from growth of 16.2 percent in the 12 months ending in Jun 2011 to 0.0 percent in the 12 months ending in Jun 2012, rebounding to 4.8 percent in Aug 2012 but declining to 1.5 percent in Sep 2012, increasing to 3.9 percent in Oct 2012, 7.9 percent in Nov 2012 and 7.6 percent in Dec 2012. Electricity grew 6.8 percent in Jan-Jul 2013 relative to a year earlier and increased 8.2 percent in the 12 months ending in Sep 2013. Electricity output increased 7.0 percent in Jan-Oct 2013 relative to a year earlier and 8.4 percent in 12 months ending in Oct 2013. Auto production jumped to 17.2 percent in Jan-Oct 2013 relative to a year earlier and 25.5 percent in 12 months ending in Oct 2013. Electricity increased 7.0 percent in Jan-Nov 2013 relative to a year earlier and autos increased 18.1 percent.

Table VC-2, China, Industrial Production Operation ∆%

	Elec- tricity	Pig Iron	Cement	Crude Oil	Non- ferrous Metals	Autos
2013
Jan-Nov	7.0	5.9	9.2	3.6	10.5	18.1
12 M Nov	6.8	0.6	10.0	-0.6	13.7	25.6
Jan-Oct	7.0	6.5	9.0	4.1	10.3	17.2
12M Oct	8.4	7.7	8.9	3.1	12.9	25.5
Jan-Sep	6.8	6.9	8.9	4.2	9.8	15.3
12M Sep	8.2	11.2	6.4	-1.2	10.1	17.5
Jan-Aug	6.4	6.6	9.2	4.7	9.7	15.1
12M Aug	13.4	11.1	8.2	5.5	5.7	14.8
Jan-Jul	5.2	6.0	9.6	4.5	10.3	15.1
12 M Jul	8.1	5.0	9.1	7.1	9.8	15.4
Jan-Jun	4.4	5.7	9.7	4.1	10.0	15.2
12 M Jun	6.0	2.9	8.8	10.8	6.7	13.5
Jan-May	4.0	10.8	8.9	2.9	10.9	15.4
12 M May	4.1	11.3	8.5	2.4	7.5	15.7
Jan-Apr	3.8	10.5	8.4	3.2	11.4	15.4
12 M Apr	6.2	8.1	8.7	2.5	10.3	18.3
Jan-Mar	2.9	12.3	8.2	4.3	10.6	13.5
12 M Mar	2.1	9.2	6.9	5.5	9.9	12.4
Jan-Feb	3.4	14.2	10.8	3.0	13.5	12.4
2012
Jan-Dec	4.7	7.7	7.4	3.7	9.3	6.3
12 M Dec	7.6	13.5	5.4	8.4	16.7	5.3
Jan-Nov	4.4	7.2	7.5	3.2	8.4	6.5
12 M Nov	7.9	16.5	9.4	9.1	15.2	3.9
Jan-Oct	3.9	6.3	6.7	2.6	7.7	6.9
12 M Oct	6.4	11.7	11.5	6.7	14.0	3.8
Jan-Sep	3.6	5.7	6.7	2.2	7.1	7.3
12 M Sep	1.5	4.9	12.0	7.0	7.1	6.3
Jan-Aug	3.8	-0.5	8.7	2.5	13.8	10.4
12 M Aug	4.8	2.6	5.9	-0.4	13.8	9.7
Jan-Jul	3.8	6.1	5.3	1.6	6.7	7.4
12M Jul	2.1	6.5	6.1	1.1	4.1	12.3
Jan-Jun	3.7	6.1	5.5	1.7	6.7	6.7
12 M Jun	0.0	6.7	6.5	-0.6	5.8	13.8
Jan-May	4.7	6.3	5.0	2.2	5.1	6.2
12 M May	2.7	6.3	4.3	0.7	6.6	18.5
Jan-Apr	5.0	6.2	5.5	2.9	4.6	3.1
12 M Apr	0.7	7.9	4.9	-0.3	2.3	10.7
Jan-Mar	7.1	6.5	7.3	3.1	5.8	0.0
12 M Mar	7.2	10.2	7.9	2.0	3.3	5.1
Jan-Feb	7.1	4.6	4.8	4.0	8.4	-1.8
2011
Jan-Dec	12.0	8.4	16.1	4.9	10.6	3.0
12 M Dec	9.7	3.7	7.0	4.0	13.2	-6.5
Jan-Nov	12.0	13.1	17.2	5.3	10.2	3.9
12 M Nov	8.5	7.8	11.2	3.2	8.2	-1.3
Jan-Oct	12.3	13.7	18.0	5.4	10.4	5.2
12 M Oct	9.3	13.4	16.5	-0.9	3.7	1.3
Jan-Sep	12.7	13.9	18.1	6.0	11.2	5.5
12 M Sep	11.5	18.8	15.7	1.5	13.9	2.5
Jan-Aug	13.0	13.1	18.4	6.6		4.7
12 M Aug	10.0	12.9	12.8	4.5	15.6	9.5
Jan-Jul	13.3	13.0	19.2	6.9	9.9	4.0
12 M Jul	13.2	14.9	16.8	5.9	9.8	-1.3
12 M Jun	16.2	14.8	19.9	-0.7	9.8	3.6
12 M May	12.1	10.6	19.2	6.0	14.2	-1.9
12 M Apr	11.7	8.3	22.4	6.8	6.1	-1.6
12 M Mar	14.8	13.7	29.8	8.0	11.6	9.9
12 M Feb	11.7	14.5	9.1	10.9	14.4	10.3
12 M Jan	5.1	3.5	16.4	12.2	1.4	23.9
12 M Dec 2010	5.6	4.6	17.3	10.3	-1.9	27.6

M: month

Source: National Bureau of Statistics of China

Monthly growth rates of industrial production in China are provided in Table VC-3. Monthly rates have fluctuated around 1 percent. Jan and Feb 2012 are somewhat weaker but there was improvement to 1.25 percent in Mar 2012. The rate of 0.33 percent in Apr 2012 is the lowest in the monthly series from Feb 2011 to Nov 2013. Monthly sales growth remained below 1 percent in all the eighteen months from Jan 2012 to Nov 2013 with the exception of Mar 2012. Value added in industry increased 0.71 percent in Sep 2013, 0.85 percent in Oct 2013 and 0.76 percent in Nov 2013.

Table VC-3, China, Industrial Production Operation, Month ∆%

2011	Month ∆%
Feb	0.93
Mar	0.99
Apr	1.32
May	0.79
Jun	1.30
Jul	0.82
Aug	0.85
Sep	0.95
Oct	0.71
Nov	0.68
Dec	0.94
Jan 2012	0.50
Feb	0.61
Mar	1.25
Apr	0.33
May	0.89
Jun	0.83
Jul	0.59
Aug	0.61
Sep	0.89
Oct	0.76
Nov	0.86
Dec	0.84
Jan 2013	0.62
Feb	0.83
Mar	0.71
Apr	0.92
May	0.69
Jun	0.74
Jul	0.88
Aug	0.92
Sep	0.71
Oct	0.85
Nov	0.76

Source: National Bureau of Statistics of China

Table VC-4 provides cumulative growth of investment in fixed assets in China in 2011 relative to 2010, Jan-Dec 2012 and Jan-Nov 2013 relative to a year earlier. Total fixed investment had grown at a high rate fluctuating around 25 percent and fixed investment in real estate development has grown at rates in excess of 30 percent but rates have declined significantly to still quite high percentages. In Jan-Nov 2013, investment in fixed assets in China grew 19.9 percent relative to a year earlier and 19.5 percent in real estate development. There was slight deceleration in the final two months of 2011 that continued into Jan-Nov 2013.

Table VC-4, China, Investment in Fixed Assets ∆% Relative to a Year Earlier

	Total	State	Real Estate Development
Jan-Nov 2013	19.9	16.8	19.5
Jan-Oct	20.1	17.1	19.2
Jan-Sep	20.2	17.6	19.7
Jan-Aug	20.3	NA	19.3
Jan-Jul	20.1	17.5	20.5
Jan-Jun	20.1	17.5	20.3
Jan-May	20.4	17.7	20.6
Jan-Apr	20.6	18.1	21.1
Jan-Mar	20.9	18.7	20.2
Jan-Feb	21.2	16.9	22.8
Jan-Dec 2012	20.6	14.7	16.2
Jan-Nov	20.7	14.5	16.7
Jan-Oct	20.7	14.2	15.4
Jan-Sep	20.5	13.6	15.4
Jan-Aug	20.2	12.9	15.6
Jan-Jul	20.4	12.6	15.4
Jan-Jun	20.4	13.8	16.6
Jan-May	20.1	10.0	18.5
Jan-Apr	20.2	9.5	18.7
Jan-Mar	20.9	9.0	23.5
Jan-Feb	21.5	8.8	27.8
Jan-Dec 2011	23.8	11.1	27.9
Jan-Nov	24.5	11.7	29.9
Jan-Oct	24.9	12.4	31.1
Jan-Sep	24.9	12.7	32.0
Jan-Aug	25.0	12.1	33.2
Jan-Jul	25.4	13.6	33.6
Jan-Jun	25.6	14.6	32.9
Jan-May	25.8	14.9	34.6
Jan-Apr	25.4	16.6	34.3
Jan-Mar	25.0	17.0	34.1
Jan-Feb	24.9	15.6	35.2

Source: National Bureau of Statistics of China

Chart VC-2 provides cumulative fixed asset investment in China relative to a year earlier in all months from 2012 to 2013. Growth rose to 25.8 percent in Jan-May 2011 and then fell back to 24.9 percent in Sep and Oct 2011, declining further to 24.5 percent in Nov and 23.8 percent in Dec 2011 with deeper drop in Jan-Feb 2012 to 21.5 percent, 20.9 percent in Jan-Mar, 20.2 percent in Jan-Apr 2012, 20.1 percent in Jan-Apr 2012, 20.4 percent in both Jan-Jun 2012 and Jan-Jul 2012, 20.2 percent in Jan-Aug 2012, 20.5 percent in Jan-Sep 2012, 20.7 percent in Jan-Oct 2012, 20.7 percent in Jan-Nov 2012, 20.6 percent in Jan-Dec 2012, 21.2 percent in Jan-Feb 2013, 20.9 percent in Jan-Mar 2013, 20.6 in Jan-Apr 2013 and 20.4 percent in Jan-May 2013. The rate eased to 20.1 percent in Jan-Jun 2013 and Jan-Jul 2013, increasing to 20.3 percent in Jan-Aug 2013. The rate increased to 20.2 percent in Jan-Sep 2013 and 20.1 percent in Jan-Oct 2013. The rate eased to 19.9 percent in Jan-Nov 2013. Rates in 2013 and 2012 have fallen from higher gains in 2011.

Chart VC-2, China, Investment in Fixed Assets, ∆% Cumulative over Year Earlier

Source: National Bureau of Statistics of China

Monetary policy has been used in China in the form of increases in interest rates and required reserves of banks to moderate real estate investment. These policies have been reversed because of lower inflation and weakening economic growth. Chart VC-3 shows decline of fluctuating cumulative growth rates of investment in real estate development relative to a year earlier from 35.2 percent in Jan-Feb 2011 to 31.1 percent in Jan-Oct 2011, 29.9 percent in Jan-Nov 2011, 27.9 percent in Jan-Dec 2011, 27.8 percent in Jan-Feb 2012 and sharper decline to 23.5 percent in Jan-Mar 2012, 18.7 percent in Jan-Apr 2012 and 18.5 percent in Jan-May 2012. The trend of decline continued with 16.6 percent in Jan-Jun 2012, 15.4 percent in Jan-Jul 2012, 15.6 percent in Jan-Aug 2012, 15.4 percent in Jan-Sep 2012, 16.7 percent in Jan-Oct 2012, 16.7 percent in Jan-Nov 2012, 16.2 percent in Jan-Dec 2012, 22.8 percent in Jan-Feb 2013, 20.2 percent in Jan-Mar 2013, 21.1 percent in Jan-Apr 2013 and 20.6 percent in Jan-May 2013. The rate eased to 20.3 percent in Jan-Jun 2013, increasing to 22.8 percent in Jan-Jul 2013. The rate fell to 19.3 percent in Jan-Aug 2013 and increased marginally to 19.7 percent in Jan-Sep 2013. The rate stabilized at 19.2 percent in Jan-Oct 2013 and 19.5 percent in Jan-Nov 2013.

Chart VC-3, China, Investment in Real Estate Development, ∆% Cumulative over Year Earlier

Source: National Bureau of Statistics of China

Growth rates of retail sales in 12 months and cumulative relative to a year earlier are in Table VC-5. There is decline of growth rates to cumulative 14.7 percent in Feb 2012, 14.8 percent in Mar, 14.7 percent in Apr, 14.5 percent in May, 14.4 percent in Jun, 14.2 percent in Jul, 14.1 percent in Aug to Oct 2012, 14.2 percent in Nov 2012 and 14.3 percent in Dec 2012. Percentage growth rates have declined in Jan-Dec 2012 relative to earlier months in 2011. The rate of retail sales growth was even lower at 12.3 percent in Feb 2013 with influence from the celebration of the New Year followed by 12.4 percent in Mar 2013 and 12.5 percent in Apr 2013. The rate of retail growth was 12.9 percent in the 12 months ending in May 2013 and 12.6 percent in Jan-May relative to a year earlier. Growth strengthened with 13.3 percent in the 12 months ending in Jun 2013 and 12.7 percent in the cumulative to Jun 2013 relative to a year earlier. Growth continued with 13.2 in 12 months in Jul 2013 and 12.8 percent in the cumulative Jan-Jul 2013 relative to a year earlier. The rate stabilized in Aug 2013 at 13.4 percent in 12 months and 12.8 percent cumulative relative to a year earlier. Stabilization continued with 13.3 percent in the 12 months ending in Sep 2013 and 12.9 percent in the cumulative relative to a year earlier. Growth stabilized at 13.3 percent in the 12 months ending in Oct 2013 and 13.0 percent in the cumulative Jan-Oct 2013 relative to a year earlier. The cumulative Jan-Nov 2013 stabilized at 13.0 percent while the 12-month rate rose slightly to 13.7 percent in Nov 2013.

Table VC-5, China, Retail Sales 12-Month ∆% and Cumulative ∆% Relative to Year Earlier

	12-Month ∆%	Cumulative ∆%/ Cumulative Year Earlier
2013
Nov	13.7	13.0
Oct	13.3	13.0
Sep	13.3	12.9
Aug	13.4	12.8
Jul	13.2	12.8
Jun	13.3	12.7
May	12.9	12.6
Apr	12.8	12.5
Mar	12.6	12.4
Feb	12.3	12.3
2012
Dec	15.2	14.3
Nov	14.9	14.2
Oct	14.5	14.1
Sep	14.2	14.1
Aug	13.2	14.1
Jul	13.1	14.2
Jun	13.7	14.4
May	13.8	14.5
Apr	14.1	14.7
Mar	15.2	14.8
Feb	14.7	14.7
Jan
2011
Dec	18.1	17.1
Nov	17.3	17.0
Oct	17.2	17.0
Sep	17.7	17.0
Aug	17.0	16.9
Jul	17.2	16.8
Jun	17.7	16.8
May	16.9	16.6
Apr	17.1	16.5
Mar	17.4	17.4
Feb	11.6	15.8
Jan	19.9	19.9

Source: National Bureau of Statistics of China

Chart VC-4 of the National Bureau of Statistics of China provides 12-month rates of growth of retail sales from 2012 to 2013. There is again a drop into 2013 with the lowest percentages in Chart VC-4 followed by moderate increases.

Chart VC-4, China, Total Retail Sales of Consumer Goods 12-Month ∆%

Source: National Bureau of Statistics of China

Table VC-6 provides monthly percentage changes of retail sales in China. Although the rate of 0.19 percent in Jan 2012 is the lowest in Table VC-7, the rate of 1.32 percent in Sep 2012 is relatively high and 1.25 percent in Dec 2012 is closer to rates in 2011. Sales are lower in Jan-Feb 2013 because of the New Year celebrations, rebounding in Mar-Nov 2013.

Table VC-6, China, Retail Sales, Month ∆%

2011	Month ∆%
Feb	1.35
Mar	1.26
Apr	1.30
May	1.39
Jun	1.49
Jul	1.57
Aug	1.50
Sep	1.33
Oct	1.36
Nov	1.26
Dec	1.41
2012
Jan	0.19
Feb	0.99
Mar	1.21
Apr	0.93
May	1.11
Jun	1.12
Jul	1.03
Aug	1.11
Sep	1.32
Oct	1.18
Nov	1.21
Dec	1.23
Jan 2013	0.15
Feb	0.95
Mar	1.31
Apr	1.27
May	1.19
Jun	1.26
Jul	1.23
Aug	1.12
Sep	1.21
Oct	1.18
Nov	1.32

Source: National Bureau of Statistics of China

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/ http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Table VC-7 provides China’s exports, imports, trade balance and 12-month percentage changes from Dec 2010 to Nov 2013. Exports surged 12.7 percent in the 12 months ending in Nov 2013 while imports increased 5.3 percent for trade surplus of $33.8 billion. Exports rebounded with growth of 5.6 percent in the 12 months ending in Oct 2013 while imports increased 7.6 percent for a trade surplus of $31.11 billion. Exports fell 0.3 percent in the 12 months ending in Sep 2013 while imports increased 7.4 for reduction of the trade surplus to $15.2 billion. Markets reacted positively to China’s trade data in Aug 2013 with exports growing 7.2 percent relative to a year earlier and imports 7.1 percent for increasing trade surplus of $28.52. Exports fell 3.1 percent in Jun 2013 and imports declined 0.7 percent with growth of 5.1 percent of exports in Jul 2013 and 10.9 percent of imports. The trade surplus reached $17.82 billion. Exports increased 1.0 percent in May 2013 relative to a year earlier while imports fell 0.3 percent with trade surplus of $20.43 billion. Exports increased 14.7 percent in Apr 2013 relative to a year earlier and imports 16.8 percent for trade surplus of $18.16 billion. Exports increased 10.0 percent in Mar 2013 relative to a year earlier and imports increased 14.1 percent for trade deficit of $0.88 billion. Exports increased 21.8 percent in Feb 2013 relative to a year earlier and imports fell 15.2 percent for trade surplus of $15.25 billion. China’s trade growth was stronger in Jan 2013 with growth of exports of 25.0 percent in 12 months and of imports of 28.8 percent for trade surplus of $29.15 billion. China’s trade growth strengthened in Dec 2012 with growth in 12 months of exports of 14.1 percent and of imports of 6.0 percent. China’s trade growth weakened again in Nov 2012 with growth of exports of 2.9 percent and no change in imports. China’s trade growth rebounded with growth of exports in 12 months of 11.6 percent in Oct 2012 and 9.9 percent in Sep 2012 after 2.7 percent in Aug 2012 and 1.0 percent in Jul 2012 while imports grew 2.4 percent in both Sep and Oct 2012, stagnating in Nov 2012. As a result, the monthly trade surplus increased from $25.2 billion in Jul 2012 to $31.9 billion in Oct 2012, declining to $19.6 billion in Nov 2012 but increasing to $31.62 billion in Dec 2012. China’s trade growth rebounded in Oct 2012 with growth of exports of 11.6 percent in 12 months and 2.4 percent for imports and trade surplus of $31.9 billion. The number that caught attention in financial markets was growth of 1.0 percent in exports in the 12 months ending in Jul 2012. Imports were also weak, growing 4.7 percent in 12 months ending in Jul 2012. Exports increased 11.3 percent in Jun 2012 relative to a year earlier while imports grew 6.3 percent. The rate of growth of exports fell to 4.9 percent in Apr 2012 relative to a year earlier and imports increased 0.3 percent but export growth was 15.3 percent in May and imports increased 12.7 percent. China reversed the large trade deficit of USD 31.48 billion in Feb 2012 with a surplus of $5.35 billion in Mar 2012, $18.42 billion in Apr 2012, $18.7 billion in May 2012, $31.7 billion in Jun 2012, $25.2 billion in Jul 2012, $26.7 billion in Aug 2012, $27.7 billion in Sep 2012, $31.9 billion in Oct 2012 and $19.6 billion in Nov 2012. Exports fell 0.5 percent in the 12 months ending in Jan 2012 while imports fell 15.3 percent for a still sizeable trade surplus of $27.3 billion. In Feb, exports increased 18.4 percent while imports jumped 39.6 percent for a sizeable deficit of $31.48 billion. There are distortions from the New Year holidays.

Table VC-7, China, Exports, Imports and Trade Balance USD Billion and ∆%

	Exports USD Billion	∆% Relative Year Earlier	Imports USD Billion	∆% Relative Year Earlier	Balance USD Billion
Nov 2013	202.21	12.7	168.4	5.3	33.8
Oct	185.41	5.6	154.30	7.6	31.11
Sep	185.64	-0.3	170.44	7.4	15.21
Aug	190.61	7.2	162.09	7.0	28.52
Jul	185.99	5.1	168.17	10.9	17.82
Jun	174.32	-3.1	147.19	-0.7	27.12
May	182.77	1.0	162.34	-0.3	20.43
Apr	187.06	14.7	168.90	16.8	18.16
Mar	182.19	10.0	183.07	14.1	-0.88
Feb	139.37	21.8	124.12	-15.2	15.25
Jan	187.37	25.0	158.22	28.8	29.15
Dec 2012	199.23	14.1	167.61	6.0	31.62
Nov	179.38	2.9	159.75	0.0	19.63
Oct	175.57	11.6	143.58	2.4	31.99
Sep	186.35	9.9	158.68	2.4	27.67
Aug	177.97	2.7	151.31	-2.6	26.66
Jul	176.94	1.0	151.79	4.7	25.15
Jun	180.20	11.3	148.48	6.3	31.72
May	181.14	15.3	162.44	12.7	18.70
Apr	163.25	4.9	144.83	0.3	18.42
Mar	165.66	8.9	160.31	5.3	5.35
Feb	114.47	18.4	145.95	39.6	-31.48
Jan	149.94	-0.5	122.66	-15.3	27.28
Dec 2011	174.72	13.4	158.20	11.8	16.52
Nov	174.46	13.8	159.94	22.1	14.53
Oct	157.49	15.9	140.46	28.7	17.03
Sep	169.67	17.1	155.16	20.9	14.51
Aug	173.32	24.5	155.56	30.2	17.76
Jul	175.13	20.4	143.64	22.9	31.48
Jun	161.98	17.9	139.71	19.3	22.27
May	157.16	19.4	144.11	28.4	13.05
Apr	155.69	29.9	144.26	21.8	11.42
Mar	152.20	35.8	152.06	27.3	0.14
Feb	96.74	2.4	104.04	19.4	-7.31
Jan	150.73	37.7	144.27	51.0	6.46
Dec 2010	154.15	17.9	141.07	25.6	13.08

Source: http://english.mofcom.gov.cn/article/statistic/BriefStatistics/

Table VC-2 provides cumulative exports, imports and the trade balance of China together with percentage growth of exports and imports relative to a year earlier. Exports grew 8.2 percent in Jan-Nov 2013 relative to a year earlier while imports increased 7.1 percent for cumulative surplus of $234.27 billion. Exports grew 7.8 percent in Jan-Oct 2013 relative to a year earlier while imports grew 7.3 percent for cumulative trade surplus of $200.46 billion. Exports increased 8.0 percent in Jan-Sep 2013 relative to a year earlier while imports increased 7.3 percent for cumulative surplus of $169.36 billion. Exports increased 9.2 percent in in Jan-Aug 2013 relative to a year earlier and imports 7.3 percent for trade surplus of $154.21 billion. Exports grew 9.5 percent in Jul 2013 relative to a year earlier and imports 7.3 percent with cumulative surplus of $125.71 billion. Exports increased 10.4 percent cumulatively in Jun 2013 and imports 6.7 for cumulative surplus of $107.95 billion. Exports increased 13.5 percent in Jan-May 2013 relative to a year earlier while imports increased 8.2 percent for cumulative surplus of $80.87 billion. Exports increased 17.4 percent in Jan-Apr 2012 relative to a year earlier while imports increased 10.6 percent for cumulative surplus of $60.98 billion. Exports increased 18.4 percent in Jan-Mar 2013 relative to a year earlier while imports increased 8.4 percent for cumulative surplus of $43.07 billion. Cumulative exports in Jan-Feb 2013 grew 23.6 percent relative to a year earlier and imports 5.0 percent for trade surplus of $44.15 billion. There is strong beginning of 2013 with trade surplus of $29.15 in Jan 2013 and growth of exports of 25.0 percent and imports of 28.8 percent. The trade balance of $231.1 billion in 2012 is stronger than the trade balance of $155.14 billion in 2011. The trade balance in 2011 of $155.14 billion is lower than those from 2008 to 2010. China’s trade balance reached $231.1 billion in Jan-Dec 2012 with cumulative growth of exports of 7.9 percent and 4.3 percent of imports, which is much lower than 20.3 percent for exports and 24.9 percent for imports in 2011 and 31.3 percent for exports and 38.7 percent for imports in 2010. There is a rare cumulative deficit of $4.2 billion in Feb 2012 reversed to a small surplus in Mar 2012 and a higher surplus of $19.3 billion in Apr 2012, increasing to $37.9 billion in May, $68.9 billion in Jun 2012, $94.1 billion in Jul 2012, $120.6 billion in Aug 2012, $148.3 billion in Sep 2012, $180.24 billion in Oct 2012, $199.54 billion in Nov 2012 and $231.1 billion in Dec 2012. More observations are required to detect trends of Chinese trade but available data suggest deceleration that would be expected from the large share of trade with Europe.

Table VC-8, China, Year to Date Exports, Imports and Trade Balance USD Billion and ∆%

	Exports USD Billion	∆% Relative Year Earlier	Imports USD Billion	∆% Relative Year Earlier	Balance USD Billion
Nov 2013	2002.42	8.2	1768.15	7.1	234.27
Oct	1800.21	7.8	1599.75	7.3	200.46
Sep	1614.86	8.0	1445.50	7.3	169.36
Aug	1429.26	9.2	1275.05	7.3	154.21
Jul	1238.73	9.5	1113.02	7.3	125.71
Jun	1052.82	10.4	944.87	6.7	107.95
May	878.56	13.5	797.69	8.2	80.87
Apr	695.87	17.4	634.88	10.6	60.98
Mar	508.87	18.4	465.80	8.4	43.07
Feb	326.73	23.6	282.58	5.0	44.15
Jan	187.37	25.0	158.22	28.8	29.15
Dec 2012	2048.93	7.9	1817.83	4.3	231.11
Nov	1849.91	7.3	1650.37	4.1	199.54
Oct	1670.90	7.8	1490.67	4.6	180.24
Sep	1495.39	7.4	1347.08	4.8	148.31
Aug	1309.11	7.1	1188.51	5.1	120.61
Jul	1131.24	7.8	1037.14	6.4	94.10
Jun	954.38	9.2	885.46	6.7	68.91
May	774.40	8.7	736.49	6.7	37.92
Apr	593.24	6.9	573.94	5.1	19.3
Mar	430.02	7.6	429.36	6.6	0.66
Feb	264.40	6.9	268.64	7.7	-4.24
Jan	149.94	-0.5	122.66	-15.3	27.28
Dec 2011	1,898.60	20.3	1,743.46	24.9	155.14
Nov	1,724.01	21.1	1585.61	26.4	138.40
Oct	1,549.71	22.0	1,425.68	26.9	124.03
Sep	1,392.27	22.7	1,285.17	26.7	107.10
Aug	1,222.63	23.6	1,129.90	27.5	92.73
Jul	1,049.38	23.4	973.17	26.9	76.21
Jun	874.3	24.0	829.37	27.6	44.93
May	712.37	25.5	689.41	29.4	22.96
Apr	555.30	27.4	545.02	29.6	10.28
Mar	399.64	26.5	400.66	32.6	-1.02
Feb	247.47	21.3	248.36	36.0	-0.89
Jan	150.7	37.7	144.27	51.0	6.46
Dec 2010	1577.93	31.3	1394.83	38.7	183.10

Source: http://english.mofcom.gov.cn/article/statistic/BriefStatistics/

VD Euro Area. Table VD-EUR provides yearly growth rates of the combined GDP of the members of the European Monetary Union (EMU) or euro area since 1996. Growth was very strong at 3.3 percent in 2006 and 3.0 percent in 2007. The global recession had strong impact with growth of only 0.4 percent in 2008 and decline of 4.4 percent in 2009. Recovery was at lower growth rates of 2.0 percent in 2010 and 1.6 percent in 2011. EUROSTAT estimates growth of GDP of the euro area of minus 0.7 percent in 2012 and minus 0.4 percent in 2013 but 1.1 percent in 2014 and 1.7 percent in 2015.

Table VD-EUR, Euro Area, Yearly Percentage Change of Harmonized Index of Consumer Prices, Unemployment and GDP ∆%

Year	HICP ∆%	Unemployment %	GDP ∆%
1999	1.2	NA	2.9
2000	2.2	9.4	3.8
2001	2.4	8.3	2.0
2002	2.3	8.6	0.9
2003	2.1	9.0	0.7
2004	2.2	9.3	2.2
2005	2.2	9.1	1.7
2006	2.2	8.4	3.3
2007	2.1	7.6	3.0
2008	3.3	7.6	0.4
2009	0.3	9.6	-4.4
2010	1.6	10.1	2.0
2011	2.7	10.2	1.6
2012	2.5	11.4	-0.7
2013*			-0.4
2014*			1.1
2015*			1.7

*EUROSTAT forecast Source: EUROSTAT

The GDP of the euro area in 2012 in current US dollars in the dataset of the World Economic Outlook (WEO) of the International Monetary Fund (IMF) is $12,199.1 billion or 16.9 percent of world GDP of $72,216.4 billion (http://www.imf.org/external/pubs/ft/weo/2012/02/weodata/index.aspx). The sum of the GDP of France $2613.9 billion with the GDP of Germany of $3429.5 billion, Italy of $2014.1 billion and Spain $1323.5 billion is $9381.0 billion or 76.9 percent of total euro area GDP and 13.0 percent of World GDP. The four largest economies account for slightly more than three quarters of economic activity of the euro area. Table VD-EUR1 is constructed with the dataset of EUROSTAT, providing growth rates of the euro area as a whole and of the largest four economies of Germany, France, Italy and Spain annually from 1996 to 2011 with the estimate of 2012 and forecasts for 2013, 2014 and 2015 by EUROSTAT. The impact of the global recession on the overall euro area economy and on the four largest economies was quite strong. There was sharp contraction in 2009 and growth rates have not rebounded to earlier growth with exception of Germany in 2010 and 2011.

Table VD-EUR1, Euro Area, Real GDP Growth Rate, ∆%

	Euro Area	Germany	France	Italy	Spain
2015*	1.7	1.9	1.7	1.2	1.7
2014*	1.1	1.7	0.9	0.7	0.5
2013*	-0.4	0.5	0.2	-1.8	-1.3
2012	-0.7	0.7	0.0*	-2.5	-1.6
2011	1.6	3.3	2.0	0.5	0.1
2010	2.0	4.0	1.7	1.7	-0.2
2009	-4.4	-5.1	-3.1	-5.5	-3.8
2008	0.4	1.1	-0.1	-1.2	0.9
2007	3.0	3.3	2.3	1.7	3.5
2006	3.3	3.7	2.5	2.2	4.1
2005	1.7	0.7	1.8	0.9	3.6
2004	2.2	1.2	2.5	1.7	3.3
2003	0.7	-0.4	0.9	0.0	3.1
2002	0.9	0.0	0.9	0.5	2.7
2001	2.0	1.5	1.8	1.9	3.7
2000	3.8	3.1	3.7	3.7	5.0
1999	2.9	1.9	3.3	1.5	4.7
1998	2.8	1.9	3.4	1.4	4.5
1997	2.6	1.7	2.2	1.9	3.9
1996	1.5	0.8	1.1	1.1	2.5

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/ http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

The Flash Eurozone PMI Composite Output Index of the Markit Flash Eurozone PMI^®, combining activity in manufacturing and services, decreased from 51.9 in Oct to 51.5 in Nov, which is a three month low after a high in 27 months in Sep (http://www.markiteconomics.com/Survey/PressRelease.mvc/e05fef5f15ae4a84bc2a2da46660a8f3). Chris Williamson, Chief Economist at Markit, finds that the Markit Flash Eurozone PMI index suggests that the index is consistent with modest growth of GDP of 0.2 percent based on the first two months of IVQ2013 (http://www.markiteconomics.com/Survey/PressRelease.mvc/e05fef5f15ae4a84bc2a2da46660a8f3). The Markit Eurozone PMI^® Composite Output Index, combining services and manufacturing activity with close association with GDP, decreased from 51.9 in Oct to 51.7 in Nov in the fifth consecutive monthly expansion (http://www.markiteconomics.com/Survey/PressRelease.mvc/9f5ed06473dc4a23b83e6a2eef32e2fa). Chris Williamson, Chief Economist at Markit, finds growth in IVQ2013 at the rate of about 0.2 percent similar to 0.1 percent IIIQ2013 (http://www.markiteconomics.com/Survey/PressRelease.mvc/9f5ed06473dc4a23b83e6a2eef32e2fa). The Markit Eurozone Services Business Activity Index decreased from 51.6 in Oct to 51.2 in Nov (http://www.markiteconomics.com/Survey/PressRelease.mvc/9f5ed06473dc4a23b83e6a2eef32e2fa). The Markit Eurozone Manufacturing PMI^® increased to 51.6 in Nov from 51.3 in Oct for the highest reading since Jun and the average for IVQ2013 pointing to the highest reading since IIQ2011 (http://www.markiteconomics.com/Survey/PressRelease.mvc/be38e62ac89f4fc1a3c0079f1a4050f4). New orders increased for the fifth consecutive month with foreign orders at the highest in two-and-a-half years. Chris Williamson, Chief Economist at Markit, finds industrial growth in the euro area at a quarterly rate of 0.6 percent. (http://www.markiteconomics.com/Survey/PressRelease.mvc/be38e62ac89f4fc1a3c0079f1a4050f4). Table EUR provides the data table for the euro area.

Table EUR, Euro Area Economic Indicators

GDP	IIIQ2013 ∆% 0.1; IIIQ2013/IIIQ2012 ∆% -0.4 Blog 12/15/13
Unemployment	Oct 2013: 12.1 % unemployment rate Oct 2013: 19.298 million unemployed Blog 12/1/13
HICP	Oct month ∆%: -0.1 12 months Oct ∆%: 0.7 Blog 11/17/13
Producer Prices	Euro Zone industrial producer prices Oct ∆%: -0.5 Oct 12-month ∆%: -1.4 Blog 12/8/13
Industrial Production	Oct month ∆%: -1.1; Oct 12 months ∆%: 0.2 Blog 12/15/13
Retail Sales	Oct month ∆%: minus 0.2 Oct 12 months ∆%: minus 0.1 Blog 12/8/13
Confidence and Economic Sentiment Indicator	Sentiment 98.5 Nov 2013 Consumer minus 15.4 Nov 2013 Blog 12/1/13
Trade	Jan-Sep 2013/Jan-Sep 2012 Exports ∆%: 0.9 Imports ∆%: -3.5 Sep 2013 12-month Exports ∆% 2.7 Imports ∆% -0.2 Blog 11/24/13

Links to blog comments in Table EUR:

12/8/13 http://cmpassocregulationblog.blogspot.com/2013/12/exit-risks-of-zero-interest-rates-world.html

12/1/13 http://cmpassocregulationblog.blogspot.com/2013/12/exit-risks-of-zero-interest-rates-world.html

11/24/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-zero-interest-rates-world.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

Table VD-1 provides percentage changes of euro area real GDP in a quarter relative to the prior quarter. Real GDP fell 0.2 percent in IVQ2011, fell 0.1 in IQ2012 and fell in the final three quarters of 2012: 0.3 percent in IIQ2012, 0.1 percent in IIIQ2012 and 0.5 percent in IVQ2012. GDP fell 0.2 percent in IQ2013 and increased 0.3 percent in IIQ2013. Growth slowed at 0.1 percent in IIIQ2013. The global recession manifested in the euro area in five consecutive quarterly declines from IIQ2008 to IIQ2009. The strongest impact was contraction of 2.8 percent in IQ2009. Recovery began in IIIQ2009 with cumulative growth of 3.9 percent to IQ2011 or at the annual equivalent rate of 2.2 percent. Growth was much more vigorous from IVQ2003 to IQ2008.

Table VD-1, Euro Area, Real GDP, Percentage Change from Prior Quarter, Calendar and Seasonally and Working Day Adjusted ∆%

	IQ	IIQ	IIIQ	IVQ
2013	-0.2	0.3	0.1
2012	-0.1	-0.3	-0.1	-0.5
2011	0.8	0.0	0.1	-0.2
2010	0.4	0.9	0.4	0.5
2009	-2.8	-0.3	0.4	0.5
2008	0.6	-0.4	-0.6	-1.7
2007	0.8	0.5	0.6	0.4
2006	0.9	1.1	0.6	1.1
2005	0.2	0.7	0.6	0.7
2004	0.5	0.6	0.4	0.3
2003	-0.1	0.1	0.5	0.7
2002	0.2	0.6	0.3	0.1
2001	0.9	0.1	0.1	0.2
2000	1.3	0.9	0.5	0.7

Source: EUROSTAT http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Table VD-2 provides percentage change in real GDP in the euro area in a quarter relative to the same quarter a year earlier. Growth rates were quite strong from 2004 to 2007. There were five consecutive quarters of sharp declines in GDP in a quarter relative to the same quarter a year earlier from IVQ2008 to IVQ2009 with sharp contractions of 5.5 percent in IQ2009, 5.3 percent in IIQ2009 and 4.4 percent in IIIQ2009. Growth rates decline in magnitude with 1.4 percent in IIIQ2011, 0.7 percent in IVQ211 and -0.2 percent in IQ2012 followed by contractions of 0.5 percent in IIQ2012, 0.7 percent in IIIQ2012 and 1.0 percent in IVQ2012. GDP contracted 1.2 percent in IQ2013 relative to a year earlier and contracted 0.6 percent in IIQ2013 relative to a year earlier. Euro area GDP contracted 0.4 percent in IIIQ2013 relative to a year earlier.

Table VD-2, Euro Area, Real GDP Percentage Change in a Quarter Relative to Same Quarter a

Year Earlier, Seasonally and Working Day Adjusted ∆%

	IQ	IIQ	IIIQ	IV
2013	-1.2	-0.6	-0.4
2012	-0.2	-0.5	-0.7	-1.0
2011	2.6	1.8	1.4	0.7
2010	1.0	2.2	2.2	2.3
2009	-5.5	-5.3	-4.4	-2.3
2008	2.1	1.2	0.0	-2.1
2007	3.7	3.0	3.0	2.3
2006	2.9	3.4	3.4	3.8
2005	1.5	1.6	1.9	2.2
2004	1.8	2.2	2.2	1.7
2003	0.8	0.4	0.5	1.2
2002	0.5	1.0	1.2	1.1
2001	2.9	2.1	1.7	1.2
2000	4.3	4.4	3.8	3.3

Source: EUROSTAT http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Table VD-3 provides growth of euro area real GDP in a quarter relative to the same quarter a year earlier not seasonally adjusted. GDP changed 0.0 percent in IIIQ2013 NSA relative to a year earlier. GDP fell 0.5 percent in IIQ2013 relative to a year earlier without seasonal adjustment and declined 1.8 percent in IQ2013 relative to a year earlier without seasonal adjustment. Growth rates in 2006 and 2007 were quite strong followed by sharp declines of 5.6 percent in IQ2009, 5.9 percent in IIQ2009 and 4.2 percent in IQ2009.

Table VD-3, Euro Area, Real GDP Percentage Change in a Quarter Relative to Same Quarter a Year Earlier, Not Seasonally Adjusted ∆%

	IQ	IIQ	IIIQ	IV
2013	-1.8	-0.5	0.0
2012	0.2	-0.9	-0.9	-1.1
2011	2.8	1.9	1.5	0.2
2010	1.1	2.4	2.2	2.1
2009	-5.6	-5.9	-4.2	-2.0
2008	1.7	1.6	0.5	-2.1
2007	3.5	3.1	3.0	2.4
2006	3.5	2.6	3.1	3.7
2005	1.0	2.1	1.9	1.8
2004	2.1	2.5	2.2	2.0
2003	1.0	0.1	0.5	1.2
2002	0.1	1.2	1.5	0.9
2001	2.7	2.0	1.7	1.5
2000	4.9	4.2	3.3	2.7

Source: EUROSTAT http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Table VD-4 provides GDP growth in IIIQ2013 and relative to the same quarter a year earlier with SAWDA (seasonal and working day adjustment) and NSA (not seasonally adjusted) for the euro zone, European Union, Japan and the US. The GDP of the euro zone increased 0.1 percent in IIIQ2013 and declined 0.4 percent relative to a year earlier SWDA and 0.0 percent NSA for IIIQ2013 while the GDP of the European Union increased 0.2 percent in IIIQ2013, increased 0.1 percent SWDA in IIIQ2013 relative to a year earlier and increased 0.3 percent relative to a year earlier NSA in IIIQ2013. Growth in IIIQ2013 was weak worldwide with somewhat stronger performance by the US but still insufficient to reduce unemployment and underemployment (http://cmpassocregulationblog.blogspot.com/2013/11/global-financial-risk-mediocre-united.html) and motivate hiring (Section I and earlier http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-zero-interest-rates-world.html).

Table VD-4, Euro Zone, European Union, Japan and USA, Real GDP Growth

	∆% IIIQ2013/ IIQ2013 SAWDA	∆% IIIQ2013/ IIIQ2012 SWDA	∆% IIIQ2013/ IIIQ2012 NSA
Euro Zone	0.1	-0.4	0.0
European Union	0.2	0.1	0.3
Germany	0.3	0.6	1.1
France	-0.1	0.2	0.5
Netherlands	0.1	-0.8	-0.6
Finland	0.4	-0.2	-1.0
Belgium	0.3	0.4	0.4
Portugal	0.2	-1.0	NA
Ireland	NA	NA	NA
Italy	-0.1	-1.9	NA
Greece	NA	-3.0	-3.0
Spain	0.1	-1.1	-0.7
United Kingdom	0.8	1.5	1.1
Japan	0.5	2.6	2.7
USA	0.9	1.8	NA

*SAWDA: Seasonally and Working Day Adjusted except UK, Japan and USA

Source: EUROSTAT http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Table VD-5 provides monthly industrial production percentage changes for total production and major segments in the euro area. Total production decreased 1.1 percent in Oct 2013 with decreases 1.3 percent in capital goods, 2.4 percent in durable goods and 0.9 percent in nondurable goods. Energy decreased 4.0 percent. Intermediate goods increased 0.4 percent. Industrial production increased in all months from Dec 2012 to Jun 2013 with exception of declines of 0.5 percent in May 2013 and 0.4 percent in Jan 2013. Industrial production fell in 1.0 percent in Jul 2013 and 0.2 percent in Sep 2013.

Table VD-5, Euro Zone, Industrial Production Month ∆%

	Total	INT	ENE	CG	DUR	NDUR
Oct 2013	-1.1	0.4	-4.0	-1.3	-2.4	-0.9
Sep	-0.2	-0.4	1.5	-0.7	-1.5	0.3
Aug	0.9	0.7	-0.8	1.9	-0.5	0.4
Jul	-1.0	-0.4	-0.5	-1.9	-1.5	-0.4
Jun	0.7	0.5	-1.1	2.2	3.7	-0.4
May	-0.5	0.3	-0.1	-1.7	-2.2	0.5

Notes: INT: Intermediate; ENE: Energy; CG: Capital Goods; DUR: Durable Consumer Goods; NDUR: Nondurable Consumer Goods

Source: EUROSTAT http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

Table VD-6 provides monthly and 12-month percentage changes of industrial production and major industrial categories in the euro zone. Most 12-month percentage changes in Table VD-6 are negative in the 12 months ending in Oct 2013 with exception of increase of 1.6 percent in intermediate goods and 1.2 percent in capital goods. Industrial production decreased 1.1 percent in the month of Oct 2013 and increased 0.2 percent in the 12 months ending in Oct 2013.

Table VD-6, Euro Zone, Industrial Production, Month and 12-Month ∆%

2013	Oct Month ∆%	Oct 12-Month ∆%
Total	-1.1	0.2
Intermediate Goods	0.4	1.6
Energy	-4.0	-3.4
Capital Goods	-1.3	1.2
Durable Consumer Goods	-2.4	-5.4
Nondurable Consumer Goods	-0.9	-0.6

Source: EUROSTAT http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

There has been significant decline in percentage changes of industrial production and major categories in 12-month rates into 2012 and 2013 as shown in Table VD-3. Negative percentage changes moderated from the high rates in Oct-Nov 2012 but are still high. All 12-month percentage changes are negative for the various segments of euro area industrial production from May to Aug 2013 with exception of capital goods in Jun but there is meager improvement in Sep and Oct 2013.

Table VD-7, Euro Zone, Industrial Production 12-Month ∆%

	Total	INT	ENE	CG	DUR	NDUR
Oct 2013	0.2	1.6	-3.4	1.2	-5.4	-0.6
Sep	0.2	-0.1	-0.6	0.3	-3.0	1.3
Aug	-1.5	-0.8	-3.3	-0.8	-4.2	-2.0
Jul	-2.0	-1.5	-1.6	-3.3	-4.4	-0.8
Jun	-0.2	-1.0	-1.9	1.4	-1.7	-0.5
May	-1.9	-2.6	-0.7	-2.3	-6.1	-0.3

Notes: INT: Intermediate; ENE: Energy; CG: Capital Goods; DUR: Durable Consumer Goods; NDUR: Nondurable Consumer Goods

Source: EUROSTAT

http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/

http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/search_database

VE Germany. Table VE-DE provides yearly growth rates of the German economy from 1992 to 2012, price adjusted chain-linked and price and calendar-adjusted chain-linked. Germany’s GDP fell 5.1 percent in 2009 after growing below trend at 1.1 percent in 2008. Recovery has been robust in contrast with other advanced economies. The German economy grew at 4.0 percent in 2010, 3.3 percent in 2011 and 0.7 percent in 2012.

The Federal Statistical Agency of Germany analyzes the fall and recovery of the German economy (http://www.destatis.de/jetspeed/portal/cms/Sites/destatis/Internet/EN/Content/Statistics/VolkswirtschaftlicheGesamtrechnungen/Inlandsprodukt/Aktuell,templateId=renderPrint.psml):

“The German economy again grew strongly in 2011. The price-adjusted gross domestic product (GDP) increased by 3.0% compared with the previous year. Accordingly, the catching-up process of the German economy continued during the second year after the economic crisis. In the course of 2011, the price-adjusted GDP again exceeded its pre-crisis level. The economic recovery occurred mainly in the first half of 2011. In 2009, Germany experienced the most serious post-war recession, when GDP suffered a historic decline of 5.1%. The year 2010 was characterised by a rapid economic recovery (+3.7%).”

Table VE-DE, Germany, GDP Year ∆%

	Price Adjusted Chain-Linked	Price- and Calendar-Adjusted Chain Linked
2012	0.7	0.9
2011	3.3	3.4
2010	4.0	3.8
2009	-5.1	-5.1
2008	1.1	0.8
2007	3.3	3.4
2006	3.7	3.9
2005	0.7	0.8
2004	1.2	0.7
2003	-0.4	-0.4
2002	0.0	0.0
2001	1.5	1.6
2000	3.1	3.3
1999	1.9	1.8
1998	1.9	1.7
1997	1.7	1.8
1996	0.8	0.8
1995	1.7	1.8
1994	2.5	2.5
1993	-1.0	-1.0
1992	1.9	1.5

Source: Statistisches Bundesamt Deutschland (Destatis) https://www.destatis.de/EN/PressServices/Press/pr/2013/08/PE13_278_811.html https://www.destatis.de/EN/PressServices/Press/pr/2013/11/PE13_381_811.html

The Flash Germany Composite Output Index of the Markit Flash Germany PMI^®, combining manufacturing and services, increased from 53.2 in Oct to 54.3 in Nov for the highest reading in ten months. The index of manufacturing output reached 54.0 in Nov from 53.6 in Oc, which is a three-month high, while the index of services increased to 54.5 in Nov from 52.9 in Oct for a nine-month high. The overall Flash Germany Manufacturing PMI^® increased from 51.7 in Oct to 52.5 in Nov, which is a 29-month high (http://www.markiteconomics.com/Survey/PressRelease.mvc/e5eae384809e48d6bf621cfbec90f758). New work volumes increased marginally. Tim Moore, Senior Economist at Markit, finds potential for growth of around 0.5 percent in the calendar year (http://www.markiteconomics.com/Survey/PressRelease.mvc/e5eae384809e48d6bf621cfbec90f758). The Markit Germany Composite Output Index of the Markit Germany Services PMI^®, combining manufacturing and services with close association with Germany’s GDP, increased from 53.2 in Oct to 55.4 in Nov (http://www.markiteconomics.com/Survey/PressRelease.mvc/b84ee870740e4d1f920ab290a975c1eb). Tim Moore, Senior Economist at Markit and author of the report, finds that German private sector companies expanded output at the fastest rate since the middle of 2011 (http://www.markiteconomics.com/Survey/PressRelease.mvc/b84ee870740e4d1f920ab290a975c1eb). The Germany Services Business Activity Index increased from 52.9 in Oct to 55.7 in Nov (http://www.markiteconomics.com/Survey/PressRelease.mvc/b84ee870740e4d1f920ab290a975c1eb). The Markit/BME Germany Purchasing Managers’ Index^® (PMI^®), showing close association with Germany’s manufacturing conditions, increased from 51.7 in Oct to 52.7 in Nov, in the best improvement since Jun 2011 (http://www.markiteconomics.com/Survey/PressRelease.mvc/b561ae61327d45b48118474e10e22081). New export orders increased for the fifth consecutive month at the highest rate since Feb. Tim Moore, Senior Economist at Markit and author of the report, finds the highest growth of foreign orders for investment goods since Apr 2011 (http://www.markiteconomics.com/Survey/PressRelease.mvc/b561ae61327d45b48118474e10e22081).Table DE provides the country data table for Germany.

Table DE, Germany, Economic Indicators

GDP	IIIQ2013 0.3 ∆%; III/Q2013/IIIQ2012 ∆% 1.1 2012/2011: 0.7% GDP ∆% 1992-2012 Blog 8/26/12 5/27/12 11/25/12 2/24/13 5/19/13 5/26/13 8/18/13 8/25/13 11/17/13 11/24/13
Consumer Price Index	Nov month NSA ∆%: 0.2 Nov 12-month NSA ∆%: 1.3 Blog 12/15/13
Producer Price Index	Oct month ∆%: -0.2 CSA, -0.2 12-month NSA ∆%: -0.7 Blog 11/24/13
Industrial Production	MFG Oct month CSA ∆%: minus -1.1 12-month NSA: 1.3 Blog 12/15/13
Machine Orders	MFG Oct month ∆%: -2.2 Oct 12-month ∆%: 2.0 Blog 11/10/13
Retail Sales	Oct Month ∆% -0.8 12-Month ∆% -0.2 Blog 12/1/13
Employment Report	Unemployment Rate SA Sep 5.2% Blog 12/1/13
Trade Balance	Exports Oct 12-month NSA ∆%: 0.6 Imports Oct 12 months NSA ∆%: -1.6 Exports Oct month CSA ∆%: 0.2; Imports Oct month SA 2.9 Blog 12/15/13

Links to blog comments in Table DE:

12/1/13 http://cmpassocregulationblog.blogspot.com/2013/12/exit-risks-of-zero-interest-rates-world.html

11/24/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-zero-interest-rates-world.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

11/10/13 http://cmpassocregulationblog.blogspot.com/2013/11/global-financial-risk-mediocre-united.html

10/13/13 http://cmpassocregulationblog.blogspot.com/2013/10/imf-view-collapse-of-united-states.html

8/25/13 http://cmpassocregulationblog.blogspot.com/2013/08/interest-rate-risks-duration-dumping.html

8/18/13 http://cmpassocregulationblog.blogspot.com/2013/08/duration-dumping-and-peaking-valuations.html

http://cmpassocregulationblog.blogspot.com/2013/07/twenty-nine-million-unemployed-or.html

5/26/13 http://cmpassocregulationblog.blogspot.com/2013/05/united-states-commercial-banks-assets.html

The production industries index of Germany in Table VE-1 shows increase of 0.4 percent in Dec 2012 and decrease of 9.4 percent in the 12 months ending in Dec 2012. The index decreased 0.6 percent in Jan 2013 and 1.4 percent in 12 months and increased 0.6 percent in Feb 2013, declining 5.0 percent in 12 months. In Mar 2013, the production index of Germany increased 0.7 percent and fell 9.0 percent in 12 months. The production index jumped 1.0 percent in Apr 2013 and 7.3 percent in 12 months. In May 2013, the production index fell 1.3 percent and 4.5 percent in 12 months. The production index of Germany increased 2.2 percent in Jun 2013 and fell 0.6 percent in 12 months. In Jul 2013, the production industries index fell 1.1 percent and increased 1.8 percent in 12 months. The production industries index increased 1.5 percent in Aug 2013 and fell 2.8 percent in 12 months. In Sep 2013, the production index fell 0.7 percent and increased 4.1 percent in 12 months. In Oct 2013, the production index of Germany fell 1.2 percent and increased 1.0 percent in12 months. Germany’s production industries suffered decline of 7.3 percent in Dec 2008 relative to Dec 2007 and decline of 2.3 percent in 2009. Recovery was vigorous with 17.1 percent in the 12 months ending in Dec 2010. The first quarter of 2011 was quite strong when the German economy outperformed the other advanced economies. The performance of Germany’s production industries from 2002 to 2006 was vigorous with average rate of 4.5 percent. Data for the production industries index of Germany fluctuate sharply from month to month and in 12-month rates.

Table VE-1, Germany, Production Industries, Month and 12-Month ∆%

	12-Month ∆% NSA	Month ∆% Calendar SA
Oct 2013	1.0	-1.2
Sep	4.1	-0.7
Aug	-2.8	1.5
Jul	1.8	-1.1
Jun	-0.6	2.2
May	-4.5	-1.3
Apr	7.3	1.0
Mar	-9.0	0.7
Feb	-5.0	0.6
Jan	-1.4	-0.6
Dec 2012	-9.4	0.4
Nov	-2.9	-0.4
Oct	4.1	-1.6
Sep	-6.7	-0.9
Aug	-0.6	-0.5
Jul	2.4	1.0
Jun	4.2	-0.7
May	-6.3	1.3
Apr	-0.6	-2.2
Mar	-0.1	2.4
Feb	2.4	-0.7
Jan	4.8	0.9
Dec 2011	2.0	-1.5
Nov	3.9	-0.1
Oct	0.1	1.1
Sep	4.5	-1.6
Aug	10.2	-1.1
Jul	5.8	3.2
Jun	-0.8	-1.5
May	18.2	0.8
Apr	5.3	-0.1
Mar	9.8	0.7
Feb	15.8	1.1
Jan	15.1	1.4
Dec 2010	17.1
Dec 2009	-2.3
Dec 2008	-7.3
Dec 2007	-0.1
Dec 2006	2.5
Dec 2005	4.9
Dec 2004	5.3
Dec 2003	5.1
Dec 2002	2.0
Average ∆% per Year
Dec 1994 to Dec 2012	0.7
Dec 1994 to Dec 2000	0.8
Dec 1994 to Dec 2006	1.3
Dec 2002 to Dec 2006	4.5

Source: Source: Statistisches Bundesamt Deutschland (Destatis)

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Table VE-2 provides monthly percentage changes of the German production industries index by components from Mar to Oct 2013. The index decreased 1.2 percent in Oct 2013 with decreases of 1.1 percent in industry, 1.1 percent in manufacturing, 3.0 percent in capital goods, 4.5 percent in durable goods and 1.9 percent in energy. Other segments increased with 0.9 percent in intermediate goods and 0.0 percent in energy.

Table VE-2, Germany, Production Industries, Industry and Components, Month ∆%

	Oct 2013	Sep	Aug	Jul	Jun	May	Apr	Mar
Production Industries	-1.2	-0.7	1.5	-1.1	2.2	-1.3	1.0	0.7
Industry	-1.1	-1.0	2.2	-1.7	2.0	-1.3	1.0	0.4
Mfg	-1.1	-1.0	2.3	-1.7	2.0	-1.3	0.9	0.4
Intermediate Goods	0.9	0.2	0.2	-0.7	0.3	0.5	0.4	0.4
Capital Goods	-3.0	-2.4	4.6	-2.7	3.7	-3.2	1.8	0.2
Durable Goods	-4.5	2.2	-3.0	-4.2	12.3	-5.0	-1.6	2.1
Nondurable Goods	0.0	-0.4	1.4	-0.4	-1.1	0.9	1.0	1.0
Energy	-1.9	2.9	-2.5	0.3	4.5	-1.9	-3.9	7.8

Seasonally Calendar Adjusted

Source: Source: Statistisches Bundesamt Deutschland (Destatis

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Table VE-3 provides 12-month unadjusted percentage changes of industry and components in Germany. There have been percentage declines of 12-month rates in the production index of Germany and all segments in the four months from Dec 2012 to Mar 2013 with exception of nondurables in Jan 2013 and energy in Mar 2013. There is sharp recovery in Apr 2013 with growth of manufacturing by 8.1 percent and capital goods by 11.2 percent. All segments show declines in 12 months in May 2013. There are increases in the 12 months ending in Jun of 0.9 percent in capital goods and 2.5 percent in durable goods. All segments increased in Jul 2013. All segments fell in Aug 2013 with sharp declines. There is strong recovery in Sep with high rates of increase. Many segments increased in the 12 months ending in Oct 2013 with 1.3 percent growth in manufacturing and 1.4 percent in capital goods. Percentage declines in 12 months are quite sharp in Dec 2012 with most percentage changes negative around two-digits. Although there are sharp fluctuations in the data, there is suggestion of deceleration that would be expected from much higher earlier rates. The deceleration is quite evident in single-digit percentage changes from Sep 2011 to Dec 2012 relative to high double-digit percentage changes in Jan-Mar 2011. There are multiple negative 12-month percentage changes across many segments. Growth rates in the recovery from the global recession from IVQ2007 to IIQ2009 were initially very vigorous in comparison with the growth rates before the contraction that are shown in the bottom part of Table VE-3.

Table VE-3, Germany, Industry and Components, 12-Month ∆% Unadjusted

	IND	MFG	INTG	CG	DG	NDG	EN
2013
Oct	1.3	1.3	2.5	1.4	-0.6	-1.1	-0.4
Sep	4.6	4.4	3.9	5.6	5.6	2.2	0.4
Aug	-2.8	-2.9	-3.7	-1.7	-7.8	-2.8	-3.5
Jul	1.4	1.3	1.7	0.3	3.5	3.0	2.1
Jun	-0.3	-0.3	-1.8	0.9	2.5	-1.1	-0.9
May	-4.4	-4.4	-3.5	-5.8	-10.4	-1.3	-5.3
Apr	8.2	8.1	4.6	11.2	9.3	8.7	-1.8
Mar	-8.8	-8.7	-8.1	-9.6	-9.3	-7.9	0.5
Feb	-4.8	-4.9	-5.6	-4.7	-6.4	-2.9	-12.0
Jan	-0.7	-0.6	-1.3	-1.8	-2.0	4.7	-4.2
2012
Dec	-9.6	-9.4	-11.8	-8.5	-12.5	-7.0	-2.4
Nov	-3.1	-3.1	-3.9	-2.7	-7.6	-1.2	0.7
Oct	3.9	3.8	2.8	4.0	0.7	7.0	3.2
Sep	-7.6	-7.5	-8.8	-7.1	-11.2	-5.2	4.0
Aug	-1.1	-1.0	-3.2	0.3	0.4	0.7	4.5
Jul	2.0	2.0	0.3	4.6	-2.4	-0.7	2.2
Jun	3.8	3.7	1.9	6.5	7.2	0.3	6.7
May	-7.0	-6.8	-7.5	-6.1	-10.6	-7.7	4.0
Apr	-1.1	-1.1	-2.0	1.9	-5.3	-5.9	3.7
Mar	-0.5	-0.4	-3.1	2.8	-6.2	-2.3	-0.8
Feb	3.2	3.3	0.9	7.3	-0.1	-2.3	5.9
Jan	5.6	5.6	3.0	10.4	4.7	0.1	-3.3
2011
Dec	1.5	1.4	1.8	1.3	0.2	1.4	-9.2
Nov	4.6	4.5	2.9	8.1	2.3	-1.0	-5.8
Oct	0.6	0.7	-0.3	3.2	-2.3	-3.4	-6.1
Sep	5.7	5.7	4.6	9.2	3.4	-0.8	-6.1
Aug	12.4	12.2	9.3	20.4	4.8	1.4	-3.0
Jul	7.9	7.8	5.0	13.7	6.8	0.1	-5.7
Jun	0.5	0.5	0.2	2.3	-10.2	-2.1	-4.7
May	21.5	21.2	17.9	28.3	20.8	12.8	-7.3
Apr	7.5	7.5	6.1	11.1	4.6	1.6	-5.5
Mar	11.2	11.2	10.8	15.0	8.6	2.0	2.8
Feb	17.3	17.1	16.3	23.1	10.1	6.3	-0.4
Jan	17.2	16.9	17.5	23.1	9.9	3.6	-2.6
2010
Dec	17.6	17.6	14.8	25.9	8.5	1.7	2.6
Nov	13.9	13.9	12.9	19.2	7.7	3.9	3.5
Oct	9.9	9.9	9.7	14.0	6.3	0.8	2.5
Sep	9.8	9.5	12.2	10.1	8.3	2.6	2.1
Aug	16.9	17.0	19.3	19.9	18.3	6.9	1.3
Jul	9.0	8.9	13.2	8.7	7.4	0.8	1.9
Jun	16.4	16.2	20.8	16.1	19.7	5.1	-2.8
May	13.1	13.3	20.0	12.0	11.2	1.4	11.1
Apr	14.9	14.9	21.7	15.5	8.8	0.2	9.4
Mar	14.3	14.5	20.4	12.3	11.8	5.8	4.2
Feb	6.8	7.4	10.6	6.5	7.9	-1.0	3.7
Jan	0.4	0.9	6.3	-3.8	0.8	-3.0	0.8
Dec 2010	17.6	17.6	14.8	25.9	8.5	1.7	2.5
Dec 2009	-3.2	-3.1	3.3	-9.9	-0.1	1.1	3.7
Dec 2008	-7.6	-7.4	-14.3	-5.4	-11.2	3.7	-9.0
Dec 2007	0.0	-0.3	-0.6	2.5	-10.0	-2.7	1.6
Dec 2006	3.2	3.1	5.2	2.3	8.6	-0.9	-5.3
Dec 2005	5.8	5.9	3.5	9.0	3.2	2.1	0.6
Dec 2004	5.3	5.5	7.7	3.4	0.8	5.7	9.6
Dec 2003	5.5	5.3	5.5	6.4	1.7	4.4	0.3
Dec 2002	3.7	3.3	5.4	3.4	-5.9	2.3	-2.6

Note: IND: Industry; MFG: Manufacturing; INTG: Intermediate Goods; CG: Capital Goods; DG: Durable Goods; NDG: Nondurable Goods; EN: Energy

Source: Statistisches Bundesamt Deutschland (Destatis)

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Broader perspective since 2005 is provided by Chart VE-1 of the Statistisches Bundesamt Deutschland, Federal Statistical Agency of Germany. The index of production industries not seasonally adjusted rises by more than one third between 2003 and 2008 with sharp fluctuations and then collapses during the global recession in 2008. Recovery has been in a steep upward trajectory that has recovered at the more recent peaks the losses during the contraction. Recovery stalled recently.

Chart VE-1, Germany, Production Industries, Not Adjusted, 2010=100

Source: Statistiche Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

More detail is provided by Chart VE-2 of the Statistiche Bundesamt Deutschland, or Federal Statistical Agency of Germany, with the unadjusted production industries index and trend from 2009 to 2013. There could be some flattening in recent months probably leading into stagnation, mild downturn and probable recovery as depicted by trend.

Chart VE-2, Germany, Production Industries, Not Adjusted, 2010=100

Source: Statistiche Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Table VE-4 provides month and 12-month rates of growth of manufacturing in Germany from Dec 2010 to Oct 2013. There are fluctuations in both monthly rates and in the past 12 months. In Jan 2013, manufacturing fell 0.9 percent and decreased 0.6 percent in 12 months. Manufacturing increased 0.8 percent in Feb 2013, declining 4.9 percent in 12 months. In Mar 2013, manufacturing increased 0.4 percent but fell 8.7 percent in 12 months. There is strong recovery in Apr 2013 with growth of 0.9 percent and 8.1 percent in 12 months. Manufacturing fell 1.3 percent in May 2013 and declined 4.4 percent in 12 months. Recovery is strong in Jun 2013 with growth of 2.0 percent in the month but decline of 0.3 percent in 12 months. Manufacturing fell 1.7 percent in Jul 2013 and increased 1.3 percent in 12 months. In Aug 2013, manufacturing increased 2.3 percent and fell 2.9 percent in 12 months. Manufacturing fell 1.0 percent in Sep 2013 and increased 4.4 percent in 12 months. In Oct 2013, manufacturing fell 1.1 percent and increased 1.3 percent in12 months.

Table VE-4, Germany, Manufacturing Month and 12-Month ∆%

	12-Month ∆% NSA	Month ∆% SA and Calendar Adjusted
Oct 2013	1.3	-1.1
Sep	4.4	-1.0
Aug	-2.9	2.3
Jul	1.3	-1.7
Jun	-0.3	2.0
May	-4.4	-1.3
Apr	8.1	0.9
Mar	-8.7	0.4
Feb	-4.9	0.8
Jan	-0.6	-0.9
Dec 2012	-9.4	1.2
Nov	-3.1	-0.1
Oct	3.8	-1.7
Sep	-7.5	-1.3
Aug	-1.0	-0.6
Jul	2.0	1.6
Jun	3.7	-1.1
May	-6.8	1.8
Apr	-1.1	-2.0
Mar	-0.4	1.2
Feb	3.3	0.1
Jan	5.6	0.7
Dec 2011	1.4	-1.6
Nov	4.5	-0.3
Oct	0.7	0.9
Sep	5.7	-1.7
Aug	12.2	-1.1
Jul	7.8	3.4
Jun	0.5	-1.5
May	21.2	1.0
Apr	7.5	0.4
Mar	11.2	0.8
Feb	17.1	1.3
Jan	16.9	0.0
Dec 2010	17.6	1.3

Source: Statistisches Bundesamt Deutschland (Destatis)

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Chart VE-5 of the Statistisches Bundesamt Deutschland, or Federal Statistical Office of Germany, provides the manufacturing index of Germany from 2009 to 2013. Manufacturing was already flattening in 2007 and fell sharply in 2008 to the beginning of 2010. Manufacturing grew sharply in the initial phase of recovery but has flattened in recent months as revealed by the trend that may be turning upward.

Chart VE-3, Germany, Production Index, Manufacturing, Not Adjusted Index and Trend, 2010=100

Source: Statistiche Bundesamt Deutschland https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Table VE-5 provides month and 12-month rates of growth of new orders of manufacturing in Germany from Jan 2010 to Oct 2013. There are fluctuations in both monthly rates and in the past 12 months. Table VE-5 reveals strong fluctuations in an evident deceleration of total orders for industry of Germany with recent improvement. Total orders for manufacturing decreased 2.0 percent in Oct 2013 and increased 2.0 percent in 12 months. There is the same behavior for total, foreign and domestic orders with decline in 12-month rates from two-digit levels to single digits and negative changes. An important aspect of Germany is that the bulk of orders is domestic or from other European countries while foreign orders have been growing rapidly. There is weakening world trade affecting export economies. As in other countries, data on orders for manufacturing are highly volatile. Most 12-month percentage changes from Jan 2012 to Sep 2012 in Table VE-1 are negative largely because of the unusual strength of the Germany economy in the beginning of 2011 but more recently because of slowing world economy in 2012-2013.

Table VE-5, Germany, Volume of Orders Received in Manufacturing, Total, Domestic and Foreign, ∆%

	Total 12 M	Total M	Foreign 12 M	Foreign M	Home 12 M	Home M
2013
Oct	2.0	-2.2	2.1	-2.3	1.8	-2.0
Sep	10.8	3.1	13.2	6.3	7.8	-0.9
Aug	0.1	-0.2	-0.7	-2.0	1.1	2.1
Jul	5.3	-2.0	6.3	-3.2	4.1	-0.2
Jun	4.6	4.5	7.8	5.2	0.3	3.5
May	-3.7	-0.6	-1.9	0.4	-6.1	-1.8
Apr	5.7	-1.8	7.3	-0.9	3.5	-2.9
Mar	-5.9	2.1	-4.9	2.4	-7.3	1.8
Feb	-3.1	2.2	-2.0	2.1	-4.6	2.1
Jan	-1.0	-1.5	0.5	-2.7	-2.7	0.2
2012
Dec	-9.1	1.0	-6.7	1.6	-12.6	0.2
Nov	-0.9	-2.6	2.4	-4.5	-5.1	0.0
Oct	4.5	3.8	7.0	6.4	1.3	0.4
Sep	-8.9	-1.7	-6.6	-2.4	-11.7	-0.6
Aug	-4.4	-1.0	-2.1	-0.4	-7.1	-1.9
Jul	-1.6	0.9	0.6	1.2	-4.2	0.5
Jun	-4.5	-2.5	-6.4	-2.8	-1.7	-2.0
May	-11.0	1.0	-3.7	2.4	-18.8	-0.9
Apr	-3.9	-1.8	-4.4	-2.7	-3.1	-0.7
Mar	-2.2	2.4	-1.2	3.3	-3.3	1.4
Feb	-4.3	0.2	-4.7	1.0	-3.8	-0.7
Jan	-2.6	-1.5	-4.6	-2.6	-0.2	-0.1
2011
Dec	0.0	2.1	-0.3	4.3	0.5	-0.6
Nov	-4.8	-2.8	-8.2	-5.0	-0.3	0.0
Oct	0.1	1.2	2.1	2.5	-2.1	-0.1
Sep	2.2	-2.9	1.9	-3.3	2.6	-2.3
Aug	7.1	-0.9	5.2	0.1	9.4	-2.3
Jul	4.9	-2.0	4.6	-5.9	5.4	3.2
Jun	3.5	-0.6	7.8	8.3	-2.0	-10.6
May	23.1	2.6	16.0	-3.7	31.8	10.8
Apr	6.7	1.9	9.6	2.4	3.0	1.1
Mar	9.8	-3.2	12.3	-3.3	6.9	-3.1
Feb	21.5	0.7	24.1	0.0	18.4	1.7
Jan	22.5	4.3	26.1	4.3	18.2	4.3
2010
Dec	21.8	-2.9	26.8	-4.2	15.4	-1.3
Nov	21.4	5.6	27.1	9.0	15.0	1.7
Oct	14.2	0.2	18.2	-0.4	10.0	0.9
Sep	13.9	-0.8	15.6	-2.7	11.9	1.5
Aug	22.2	2.1	29.7	4.2	14.5	-0.3
Jul	14.1	-0.5	21.4	-0.4	6.4	-0.6
Jun	27.6	2.2	30.6	2.6	24.2	1.7
May	24.8	0.0	29.6	0.9	19.4	-1.1
Apr	29.9	3.1	34.0	3.3	25.7	2.9
Mar	29.4	4.9	32.9	5.0	25.8	4.8
Feb	24.0	-0.2	28.7	0.2	18.6	-0.7
Jan	17.0	4.1	23.8	4.7	9.8	3.3
Dec 2009	9.1	-1.7	10.5	-2.6	7.3	-0.5
Dec 2008	-28.3	-6.7	-31.5	-9.5	-23.7	-2.9
Dec 2007	7.1	-0.9	9.1	-2.0	4.4	0.2
Dec 2006	2.8	0.8	3.4	0.5	2.2	1.1
Dec 2005	5.0	-0.5	10.4	-1.1	-1.4	0.3
Dec 2004	12.7	6.5	13.0	8.5	12.7	4.9
Dec 2003	10.7	2.4	16.4	5.4	5.1	-0.8
Dec 2002	-0.2	-3.4	-0.8	-6.6	0.2	-0.3
Average ∆% 2003-2007	7.6		10.4		4.5
Average ∆% 2003-2012	2.3		3.9		0.3

Notes: AE: Annual Equivalent; M: Month; M: Calendar and seasonally adjusted; 12 M: Non-adjusted Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Orders for capital goods of Germany are shown in Table VE-6. Total capital goods orders decreased 5.2 percent in Oct 2013 and increased 1.4 percent in 12 months. Domestic orders decreased 4.2 percent in Oct and foreign orders decreased 5.8 percent. There has been deceleration from 2010, early 2011 with growth rates falling from two digit levels to single digits, and multiple negative changes with recent improvement. An important aspect of Germany’s economy shown in Tables VE-5 and VE-6 is the success in increasing the competitiveness of its economic activities as shown by rapid growth of orders for industry after the recession of 2001 in the period before the global recession beginning in late 2007. Germany adopted fiscal and labor market reforms to increase productivity.

Table VE-6, Germany, Volume of Orders Received of Capital Goods Industries, Total, Foreign and Domestic, ∆%

	Total 12 M	Total M	Foreign 12 M	Foreign M	Domestic 12 M	Domestic M
2013
Oct	1.4	-5.2	1.4	-5.8	1.1	-4.2
Sep	14.5	5.2	16.9	9.7	10.1	-2.2
Aug	3.4	-0.5	1.7	-3.3	5.8	4.3
Jul	6.8	-3.6	8.6	-5.0	4.0	-0.9
Jun	8.7	8.0	13.3	8.9	1.1	6.6
May	-3.6	-0.8	-1.1	1.0	-7.9	-4.1
Apr	5.6	-2.3	6.5	-2.4	3.9	-2.1
Mar	-6.1	1.7	-4.6	2.6	-8.5	0.2
Feb	-0.7	3.0	1.6	2.4	-4.3	4.0
Jan	1.3	-2.0	3.6	-2.6	-2.3	-1.0
2012
Dec	-7.7	2.4	-4.6	2.6	-13.3	1.8
Nov	-0.7	-3.9	3.1	-5.6	-6.5	-0.6
Oct	4.6	4.7	6.3	6.8	2.1	1.1
Sep	-7.5	-0.4	-4.8	-0.7	-11.6	0.0
Aug	-4.6	-2.4	-2.6	-1.5	-7.4	-3.8
Jul	-0.3	1.3	1.2	1.9	-2.7	0.4
Jun	-7.1	-2.9	-9.9	-3.5	-1.9	-1.7
May	-12.0	1.0	-2.8	2.1	-23.9	-0.7
Apr	-3.3	-3.2	-4.2	-3.9	-1.7	-1.9
Mar	2.2	5.1	3.3	7.2	0.2	1.5
Feb	-5.9	1.2	-7.0	1.1	-4.2	1.3
Jan	-3.7	-3.6	-6.5	-4.1	1.0	-2.9
2011
Dec	1.2	2.8	-0.1	4.2	3.5	0.7
Nov	-6.5	-3.4	-10.5	-6.7	0.7	2.1
Oct	3.1	2.6	6.2	4.5	-2.0	-0.7
Sep	2.9	-2.8	2.2	-3.5	4.0	-1.8
Aug	6.7	-0.7	4.5	0.3	10.6	-2.4
Jul	7.2	-5.7	6.4	-9.5	8.8	1.4
Jun	9.1	0.3	13.3	12.5	2.0	-16.0
May	27.5	4.9	17.7	-4.3	43.5	20.4
Apr	11.0	3.9	14.1	5.2	6.3	1.7
Mar	12.0	-6.0	14.4	-5.7	8.5	-6.5
Feb	29.3	2.5	32.5	0.8	24.8	5.4
Jan	26.8	3.8	32.8	4.4	17.7	2.8
2010
Dec	27.4	-5.1	31.2	-6.8	21.1	-1.9
Nov	30.4	9.7	37.0	13.9	20.1	2.9
Oct	20.5	-0.6	24.9	-1.9	14.3	1.7
Sep	18.2	-1.7	20.3	-3.6	14.7	1.7
Aug	27.5	5.0	40.0	7.0	11.5	1.7
Jul	14.1	-1.7	28.1	-1.7	-2.5	-1.8
Jun	32.0	3.0	38.7	4.3	22.1	0.7
May	26.2	1.7	36.6	1.8	12.8	1.5
Apr	31.0	3.1	41.4	4.1	18.1	1.7
Mar	25.8	6.3	33.8	7.1	15.7	5.0
Feb	21.2	-1.1	31.3	-0.1	8.3	-2.4
Jan	17.0	4.4	29.6	3.0	2.8	6.9
Dec 2009	8.1	-1.2	13.6	-1.5	0.3	-1.0
Dec 2008	-32.2	-7.2	-36.8	-10.0	-24.5	-3.6
Dec 2007	9.4	-0.6	11.6	-2.3	6.1	2.2
Dec 2006	3.5	2.2	3.9	2.9	2.9	1.2
Dec 2005	1.8	-2.1	9.7	-2.5	-8.4	-1.6
Dec 2004	19.5	11.2	18.6	12.2	20.6	9.7
Dec 2003	11.7	2.1	17.2	5.0	5.4	-1.6
Dec 2002	-2.8	-4.3	-3.7	-8.1	-1.8	0.2
Average ∆% 2003-2007	9.0		12.1		4.9
Average ∆% 2003-2012	3.0		4.7		0.5

Notes: AE: Annual Equivalent; M: Month; M: Calendar and seasonally-adjusted; 12 M: Non-adjusted

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Chart VE-1 of the German Statistisches Bundesamt Deutschland shows the sharp upward trend of total orders in manufacturing before the global recession. There is also an obvious upward trend in the recovery from the recession with Germany’s economy being among the most dynamic in the advanced economies until the slowdown beginning in the final months of 2011 and what could be stationary series from late 2011 into 2012 but risk of decline in the final segment.

Chart VE-4, Germany, Volume of Total Orders in Manufacturing, Non-Adjusted, 2005=100

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Chart VE-2 of the German Statistisches Bundesamt Deutschland provides unadjusted volume of total orders in manufacturing and a trend curve. The final segment on the right could be the beginning of inversion to mildly increasing trend but it may be early to reach conclusions.

Chart VE-5, Germany, Volume of Total Orders in Manufacturing and Trend, Non-Adjusted, 2005=100

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Twelve-month rates of growth Germany’s exports and imports are shown in Table VE-9. There was sharp decline in the rates in Jun and Jul 2011 to single-digit levels especially for exports. In the 12 months ending in Aug 2011, exports rose 14.6 percent and imports 13.2 percent. In Sep 2011, exports grew 10.5 percent relative to a year earlier and imports grew 11.7 percent. Growth rates in 12 months ending in Oct 2011 fell significantly to 3.6 percent for exports and 9.2 percent for imports. Lower prices may explain part of the decline in nominal values. Exports fell 3.8 percent in 12 months ending in Sep 2012, rebounding to growth of 10.5 percent in Oct 2012 and minus 0.5 percent in Nov 2012 but sharp decline of 7.3 percent in Dec 2012 followed by rebound of 2.4 percent in Jan 2013. Exports fell 3.2 percent in the 12 months ending in Feb 2013 and declined 4.6 percent in the 12 months ending in Mar 2013. In Apr 2013, exports increased 7.7 percent relative to a year earlier. Exports fell 4.8 percent in the 12 months ending in May 2013. Exports fell 5.7 percent in the 12 months ending in Aug 2013 and imports fell 2.3 percent. In the 12 months ending in Sep 2013, exports increased 3.5 percent and imports fell 0.3 percent. Exports increased 0.6 percent in the 12 months ending in Oct 2013 while imports fell 1.6 percent. Imports decreased 4.1 percent in the 12 months ending in Sep 2012, rebounding to growth of 5.7 percent in Oct 2012, decreasing 1.5 percent in Nov 2012 and 7.8 percent in Dec 2012 and rebounding 2.7 percent in Jan 2013. Imports fell 5.7 percent in the 12 months ending in Feb 2013 and declined 7.5 percent in Mar 2013. In Apr 2013, imports increased 4.3 percent relative to a year earlier. In May 2013, imports fell 3.1 percent relative to a year earlier. Imports fell 1.2 percent in the 12 months ending in Jun 2013. In Jul 2013, imports increased 0.9 percent relative to a year earlier. Imports fell 2.3 percent in the 12 months ending in Aug 2013. In the 12 months ending in Sep 2013, exports declined 0.3 percent. Imports fell 1.6 percent in the 12 months ending in Oct 2013. Growth was much stronger in the recovery during 2010 and 2011 from the fall from 2007 to 2009. Germany’s trade grew at high rates in 2006 and 2005.

Table VE-7, Germany, Exports and Imports NSA Euro Billions and 12-Month ∆%

	Exports EURO Billions	12- Month ∆%	Imports EURO Billions	12-Month ∆%
Oct 2013	99.1	0.6	81.2	-1.6
Sep	94.6	3.5	74.3	-0.3
Aug	85.0	-5.7	71.7	-2.3
Jul	93.1	-0.3	76.8	0.9
Jun	92.4	-2.0	75.4	-1.2
May	88.2	-4.8	74.6	-3.1
Apr	94.0	7.7	76.0	4.3
Mar	94.2	-4.6	75.4	-7.5
Feb	88.3	-3.2	71.5	-5.7
Jan	88.2	2.4	74.6	2.7
Dec 2012	78.6	-7.3	66.6	-7.8
Nov	93.7	-0.5	76.8	-1.5
Oct	98.4	10.5	82.5	5.7
Sep	91.4	-3.8	74.5	-4.1
Aug	90.2	5.7	73.4	-0.1
Jul	93.3	9.1	76.2	1.5
Jun	94.3	7.0	76.3	1.4
May	92.7	0.3	77.0	-0.7
Apr	87.2	3.2	72.9	-1.1
Mar	98.7	0.1	81.5	2.1
Feb	91.2	7.9	75.8	4.6
Jan	86.1	8.6	72.6	4.6
Dec 2011	84.8	4.7	72.3	5.6
Nov	94.1	7.4	78.0	5.8
Oct	89.1	3.6	78.1	9.2
Sep	95.0	10.5	77.7	11.7
Aug	85.3	14.6	73.5	13.2
Jul	85.6	5.2	75.0	9.7
Jun	88.1	3.3	75.2	5.6
May	92.4	21.2	77.5	17.4
Apr	84.5	12.4	73.7	18.5
Mar	98.7	15.3	79.8	15.1
Feb	84.5	20.8	72.5	27.6
Jan	79.3	25.2	69.4	26.0
Dec 2010	81.0	20.0	68.4	24.4
Nov	87.6	21.2	73.7	30.9
Oct	86.0	18.7	71.5	19.2
Sep	86.0	21.2	69.5	17.0
Aug	74.4	23.8	64.9	27.1
Jul	81.4	15.3	68.4	24.4
Jun	85.3	27.5	71.2	33.9
May	76.2	25.6	66.1	31.3
Apr	75.2	16.8	62.2	14.4
Mar	85.6	22.0	69.3	18.0
Feb	70.0	9.7	56.8	3.2
Jan	63.4	-0.3	55.1	-1.9
Dec 2009	67.5	1.2	55.0	-7.3
Dec 2008	66.7	-8.6	59.4	-5.1
Dec 2007	73.0	-0.6	62.5	-0.1
Dec 2006	73.4	10.2	62.6	8.5
Dec 2005	66.6	11.5	57.7	18.1
Dec 2004	59.7	9.2	48.9	10.8
Dec 2003	54.7	7.6	44.1	3.9
Dec 2002	50.8	5.5	42.5	6.4
Dec 2001	48.2	-3.7	39.9	-17.5
Dec 2000	50.0		48.4

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Chart VE-6 of the Statistisches Bundesamt Deutschland shows exports and trend of German exports. Growth has been with fluctuations around a strong upward trend that is milder than earlier in the recovery but could be flattening or even falling.

Chart VE-6, Germany, Exports Original Value and Trend 2009-2012

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Chart VE-7 of the Statistisches Bundesamt Deutschland provides German imports and trend. Imports also fell sharply and have been recovering with fluctuations around a strong upward trend that could be flattening.

Chart VE-7, Germany, Imports Original Value and Trend 2009-2012

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Chart VE-8 of the Statistisches Bundesamt Deutschland shows the trade balance of Germany since 2008. There was sharp decline during the global recession and fluctuations around a mild upward trend during the recovery with stabilization followed by stronger trend in recent months and flattening/declining recently.

Chart VE-8, Germany, Trade Balance Original and Trend 2009-2012

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

Table VE-8 provides monthly rates of growth of exports and imports of Germany. Exports increased 0.2 percent in Oct 2013 calendar and seasonally adjusted (CSA) and imports increased 2.9 percent. Export growth had been relatively strong from Dec 2012 to Apr 2013 with only one monthly decline of 1.2 percent in Feb 2013. Exports fell 2.3 percent in May 2013 and 0.8 percent in Jul 2013. Export growth and import growth were vigorous in Jan-Mar 2011 when Germany’s economy outperformed most advanced economies but less dynamic and consistent in following months as world trade weakens.

Table VE-8, Germany, Exports and Imports Month ∆% Calendar and Seasonally Adjusted

	Exports	Imports
Oct 2013	0.2	2.9
Sep	1.6	-1.9
Aug	1.0	0.1
Jul	-0.8	0.2
Jun	1.2	-0.4
May	-2.3	0.9
Apr	1.6	1.4
Mar	0.3	0.4
Feb	-1.2	-2.8
Jan	1.7	2.8
Dec 2012	0.2	-1.2
Nov	-2.6	-3.9
Oct	0.4	2.6
Sep	-2.5	-0.5
Aug	1.7	-0.1
Jul	0.6	0.2
Jun	-0.9	-1.9
May	3.7	4.3
Apr	-0.9	-4.2
Mar	-0.5	1.1
Feb	1.0	3.4
Jan	2.9	-0.2
Dec 2011	-2.9	-1.7
Nov	2.8	-0.4
Oct	-3.5	-0.4
Sep	1.6	0.1
Aug	2.6	-0.1
Jul	-1.2	0.2
Jun	0.0	0.7
May	1.9	0.9
Apr	-3.1	-0.6
Mar	4.5	1.9
Feb	1.1	2.5
Jan	1.0	3.1
Dec 2010	-0.1	-1.9

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/FactsFigures/Indicators/ShortTermIndicators/ShortTermIndicators.html

There is extremely important information in Table VE-9 for the current sovereign risk crisis in the euro zone. Table VE-9 provides the structure of regional and country relations of Germany’s exports and imports with newly available data for Oct 2013. German exports to other European Union (EU) members are 57.8 percent of total exports in Oct 2013 and 57.1 percent in cumulative Jan-Oct 2013. Exports to the euro area are 36.9 percent of the total in Oct and 36.8 percent cumulative in Jan-Oct. Exports to third countries are 42.1 percent of the total in Oct and 42.9 percent cumulative in Jan-Oct. There is similar distribution for imports. Exports to non-euro countries are increasing 6.2 percent in the 12 months ending in Oct 2013, increasing 1.7 percent cumulative in Jan-Oct 2013 while exports to the euro area are decreasing 0.1 percent in the 12 months ending in Ot 2013 and decreasing 1.8 percent cumulative in Jan-Oct 2013. Exports to third countries, accounting for 42.1 percent of the total in Oct 2013, are decreasing 1.3 percent in the 12 months ending in Oct 2013 and decreasing 0.8 percent cumulative in Jan-Oct 2013, accounting for 42.9 percent of the cumulative total in Jan-Oct 2013. Price competitiveness through devaluation could improve export performance and growth. Economic performance in Germany is closely related to Germany’s high competitiveness in world markets. Weakness in the euro zone and the European Union in general could affect the German economy. This may be the major reason for choosing the “fiscal abuse” of the European Central Bank considered by Buiter (2011Oct31) over the breakdown of the euro zone. There is a tough analytical, empirical and forecasting doubt of growth and trade in the euro zone and the world with or without maintenance of the European Monetary Union (EMU) or euro zone. Germany could benefit from depreciation of the euro because of high share in its exports to countries not in the euro zone but breakdown of the euro zone raises doubts on the region’s economic growth that could affect German exports to other member states.

Table VE-9, Germany, Structure of Exports and Imports by Region, € Billions and ∆%

	Oct 2013 € Billions	Oct 12-Month ∆%	Cumulative Jan-Oct 2012 € Billions	Cumulative Jan-Oct 2013/ Jan-Oct 2012 ∆%
Total Exports	99.1	0.6	917.0	-0.7
A. EU Members	57.3 % 57.8	2.1	523.5 % 57.1	-0.6
Euro Area	36.6 % 36.9	-0.1	337.5 % 36.8	-1.8
Non-euro Area	20.7 % 20.9	6.2	185.9 % 20.3	1.7
B. Third Countries	41.7 % 42.1	-1.3	393.5 % 42.9	-0.8
Total Imports	81.2	-1.6	751.4	-1.5
C. EU Members	53.3 % 65.6	3.1	483.9 % 64.4	0.5
Euro Area	36.6 % 45.1	3.4	336.7 % 44.8	-0.4
Non-euro Area	16.7 % 20.6	2.6	147.2 % 19.6	2.6
D. Third Countries	27.9 % 34.4	-9.4	267.5 % 35.6	-4.8

Notes: Total Exports = A+B; Total Imports = C+D

Source: Statistisches Bundesamt Deutschland

https://www.destatis.de/EN/PressServices/Press/pr/2013/12/PE13_413_51.html

VF France. Table VF-FR provides growth rates of GDP of France with the estimates of Institut National de la Statistique et des Études Économiques (INSEE). The long-term rate of GDP growth of France from IVQ1949 to IVQ2012 is quite high at 3.2 percent. France’s growth rates were quite high in the four decades of the 1950s, 1960, 1970s and 1980s with an average growth rate of 4.0 percent compounding the average rates in the decades and discounting to one decade. The growth impulse diminished with 1.9 percent in the 1990s and 1.7 percent from 2000 to 2007. The average growth rate from 2000 to 2012, using fourth quarter data, is 1.0 percent because of the sharp impact of the global recession from IVQ2007 to IIQ2009. The growth rate from 2000 to 2012 is 1.0 percent. Cobet and Wilson (2002) provide estimates of output per hour and unit labor costs in national currency and US dollars for the US, Japan and Germany from 1950 to 2000 (see Pelaez and Pelaez, The Global Recession Risk (2007), 137-44). The average yearly rate of productivity change from 1950 to 2000 was 2.9 percent in the US, 6.3 percent for Japan and 4.7 percent for Germany while unit labor costs in USD increased at 2.6 percent in the US, 4.7 percent in Japan and 4.3 percent in Germany. From 1995 to 2000, output per hour increased at the average yearly rate of 4.6 percent in the US, 3.9 percent in Japan and 2.6 percent in Germany while unit labor costs in US fell at minus 0.7 percent in the US, 4.3 percent in Japan and 7.5 percent in Germany. There was increase in productivity growth in the G7 in Japan and France in the second half of the 1990s but significantly lower than the acceleration of 1.3 percentage points per year in the US. Lucas (2011May) compares growth of the G7 economies (US, UK, Japan, Germany, France, Italy and Canada) and Spain, finding that catch-up growth with earlier rates for the US and UK stalled in the 1970s.

Table VF-FR, France, Average Growth Rates of GDP Fourth Quarter, 1949-2012

Period	Average ∆%
1949-2012	3.2
2000-2012	1.0
2000-2011	1.1
2000-2007	1.7
1990-1999	1.9
1980-1989	2.5
1970-1979	3.8
1960-1969	5.7
1950-1959	4.2

Source: Institut National de la Statistique et des Études Économiques

http://www.insee.fr/en/themes/info-rapide.asp?id=26&date=20131114

The Markit Flash France Composite Output Index decreased from 50.5 in Oct to 48.5 in Nov for a five-month low (http://www.markiteconomics.com/Survey/PressRelease.mvc/7c0ea79cfd254761bc386fa76177d900). Jack Kennedy, Senior Economist at Markit and author of the report, finds that the data point to risk of decline of 0.1 percent of GDP in France in IVQ2013 after decline of 0.1 percent in IIIQ2013 (http://www.markiteconomics.com/Survey/PressRelease.mvc/7c0ea79cfd254761bc386fa76177d900). The Markit France Composite Output Index, combining services and manufacturing with close association with French GDP, fell from 50.5 in Oct to 48.0 in Nov, indicating moderate contraction (http://www.markiteconomics.com/Survey/PressRelease.mvc/9ae3c4978e5448f0bd6f5f9d5cbb41f4). Jack Kennedy, Senior Economist at Markit and author of the France Services PMI^®, finds risks of contraction in IVQ2013 (http://www.markiteconomics.com/Survey/PressRelease.mvc/9ae3c4978e5448f0bd6f5f9d5cbb41f4). The Markit France Services Activity index decreased from 50.9 in Oct to 48.0 in Nov (http://www.markiteconomics.com/Survey/PressRelease.mvc/9ae3c4978e5448f0bd6f5f9d5cbb41f4). The Markit France Manufacturing Purchasing Managers’ Index^® decreased to 48.4 in Nov from 49.1 in Oct for the lowest reading since Jun (http://www.markiteconomics.com/Survey/PressRelease.mvc/d36e5325c9c8408a9291a7cc2685cde0). Jack Kennedy, Senior Economist at Markit and author of the France Manufacturing PMI^®, finds declines in output, new orders and employment with squeeze of the highest input price inflation in 20 months while sales prices stagnated (http://www.markiteconomics.com/Survey/PressRelease.mvc/d36e5325c9c8408a9291a7cc2685cde0). Table FR provides the country data table for France.

Table FR, France, Economic Indicators

CPI	Nov month ∆% 0.0 12 months ∆%: 0.7 12/15/13
PPI	Oct month ∆%: -0.2 Oct 12 months ∆%: -1.4 Blog 12/1/13
GDP Growth	IIIQ2013/IIQ2013 ∆%: minus 0.1 IIIQ2013/IIIQ2012 ∆%: 0.2 Blog 3/31/13 5/19/12 6/30/13 9/29/13 11/17/13
Industrial Production	Oct ∆%: Manufacturing 0.4 12-Month ∆%: Manufacturing 0.7 Blog 12/15/13
Consumer Spending	Manufactured Goods Oct ∆%: 0.7 Oct 12-Month Manufactured Goods ∆%: 0.6 Blog 12/1/13
Employment	Unemployment Rate: IIIQ2013 10.5% Blog 12/8/13
Trade Balance	Oct Exports ∆%: month -0.3, 12 months -2.0 Oct Imports ∆%: month -2.5, 12 months -2.7 Blog 11/17/13
Confidence Indicators	Historical averages 100 Oct Mfg Business Climate 98 Blog 12/1/13

Links to blog comments in Table FR:

12/8/13 http://cmpassocregulationblog.blogspot.com/2013/12/exit-risks-of-zero-interest-rates-world.html

12/1/13 http://cmpassocregulationblog.blogspot.com/2013/12/exit-risks-of-zero-interest-rates-world.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

9/29/13 http://cmpassocregulationblog.blogspot.com/2013/09/mediocre-and-decelerating-united-states.html

6/30/13 http://cmpassocregulationblog.blogspot.com/2013/06/tapering-quantitative-easing-policy-and.html

5/19/13 http://cmpassocregulationblog.blogspot.com/2013/05/word-inflation-waves-squeeze-of.html

Table VF-1 provides longer historical perspective of manufacturing in France. Output of manufacturing increased 0.4 percent in Oct 2013 and increased 0.7 percent in the 12 months ending in Oct 2013. Manufacturing in France fell 14.2 percent in the 12 months ending in Dec 2008 and 4.1 percent in Dec 2009.

Table VF-1, France, Manufacturing, Month and 12-Month ∆%

	Month ∆%	12-Month ∆%
Oct 2013	0.4	0.7
Sep	-0.5	-1.2
Aug	0.9	-2.8
Jul	-0.9	-2.2
Jun	-0.3	-0.1
May	-1.0	0.0
Apr	2.5	0.4
Mar	-0.9	-3.7
Feb	0.7	-1.2
Jan	-0.7	-3.7
Dec 2012	1.3	-3.3
Nov	-0.8	-6.1
Oct	-1.5	-3.4
Sep	-2.2	-2.3
Aug	1.6	-0.8
Jul	1.2	-2.6
Jun	-0.2	-3.5
May	-0.6	-5.3
Apr	-1.7	-3.1
Mar	1.7	-2.3
Feb	-1.9	-5.3
Jan	-0.3	-2.8
Dec 2011	-1.6	-0.4
Nov	2.1	1.9
Oct	-0.4	2.0
Sep	-0.6	1.4
Aug	-0.3	3.6
Jul	0.3	3.4
Jun	-2.1	3.4
May	1.7	4.9
Apr	-0.9	4.0
Mar	-1.4	5.4
Feb	0.8	9.2
Jan	2.1	8.4
Dec 2010	0.6	5.9
Dec 2009		-4.1
Dec 2008		-14.2
Dec 2007		-0.8
Dec 2006		2.6
Dec 2005		0.7
Dec 2004		0.9
Dec 2003		0.3
Dec 2002		-1.1
Dec 2001		-5.4
Dec 2000		4.6

Source:

Institut National de la Statistique et des Études Économiques

http://www.insee.fr/en/themes/info-rapide.asp?id=10&date=20131210

Chart VF-3 of the Institut National de la Statistique et des Études Économiques provides France’s index of manufacturing, adjusted for working days and seasonal effects, from Jan 1990 to Oct 2013. Growth was robust in the 1990s and in recovery from the 2001 recession. Manufacturing output fell sharply during the global recession followed by recovery and another trend of decline.

Chart VF-1, France, Index of Manufacturing 2010=100, Jan 1990-Oct 2013, Seasonal and Working-Day Adjusted

Source:

Institut National de la Statistique et des Études Économiques

http://www.insee.fr/en/themes/info-rapide.asp?id=10&date=20131210

Chart VF-2 of France’s Institut National de la Statistique et des Études Économiques shows indices of manufacturing in France from 2009 to 2013. Manufacturing, which is CZ in Chart VF-2, fell deeply in 2008 and part of 2009. All curves of industrial indices tend to flatten recently with oscillations and declines and marginal improvement followed by renewed decline/stability in the final segment with jump in Mar-Apr 2013. Manufacturing fell in May-Jul 2013 with mild recovery in Aug 2013 and decline in Sep 2013. Manufacturing increased in Oct 2013.

Chart VF-2, France, Industrial Production Indices 2009-2013

Legend: CZ : Manufacturing – (C1) : Manufacture of food products and beverages – (C3) : Electrical and electronic equipment; machine equipment – (C4) : Manufacture of transport equipment – (C5) : Other manufacturing

Source: Institut National de la Statistique et des Études Économiques

http://www.insee.fr/en/themes/info-rapide.asp?id=10&date=20131210

France has been running a trade deficit fluctuating around €5,000 million as shown in Table VF-2. Exports decreased 0.3 percent in Oct 2013 while imports decreased 2.5 percent. The trade deficit decreased from revised €5636 million in Sep 2013 to €4697 million in Oct 2013.

Table VF-2, France, Exports, Imports and Trade Balance, € Millions

	Exports	Imports	Trade Balance
Oct 2013	36,526	41,223	-4,697
Sep	36,637	42,273	-5,636
Aug	36,047	40,939	-4,892
Jul	36,482	41,645	-5,163
Jun	36,068	40,640	-4,572
May	35,875	41,676	-5,801
Apr	38,109	42,026	-3,917
Mar	36,116	40,682	-4,566
Feb	35,610	41,399	-5,789
Jan	36,451	41,963	-5,512
Dec 2012	37,321	42,978	-5,657
Nov	36,189	41,051	-4,862
Oct	37,275	42,388	-5,113
Sep	37,133	42,116	-4,983
Aug	38,047	44,169	-6,122
Jul	36,700	41,082	-4,382
Jun	36,480	43,196	-6,716
May	37,660	43,039	-5,379
Apr	36,570	42,605	-6,035
Mar	36,370	42,416	-6,046
Feb	37,144	43,538	-6,394
Jan	36,606	42,297	-5,691
Dec 2011	35,982	41,437	-5,455
Dec 2010	33,793	39,491	-5,698

Source: France, Direction générale des douanes et droits indirects

http://lekiosque.finances.gouv.fr/Appchiffre/portail_default.asp

Table VF-3 provides month and 12-month percentage changes of France’s exports and imports. Exports decreased 0.3 percent in Oct 2013 and decreased 2.0 percent in the 12 months ending in Oct 2013. Imports decreased 2.5 percent in Oct 2013 and decreased 2.7 percent in 12 months. Growth of exports and imports has fluctuated in 2011, 2012 and 2013 because of price surges of commodities and raw materials. Weak economic conditions worldwide also influence trade performance.

Table VF-3, France, Exports and Imports, Month and 12-Month ∆%

	Exports Month ∆%	Exports 12-Month ∆%	Imports Month ∆%	Imports 12-Month ∆%
Oct 2013	-0.3	-2.0	-2.5	-2.7
Sep	1.6	-1.3	3.3	0.4
Aug	-1.2	-5.3	-1.7	-7.3
Dec 2012		3.7		3.7
Dec 2011		6.5		4.9
Dec 2010		13.4		14.8
Dec 2009		-9.6		-1.9
Dec 2008		-6.9		-10.8
Dec 2007		5.9		8.0
Dec 2006		6.2		6.6
Dec 2005		11.6		15.4
Dec 2004		-3.7		5.8
Dec 2003		7.1		1.6

Source: France, Direction générale des douanes et droits indirects

http://lekiosque.finances.gouv.fr/Appchiffre/portail_default.asp

Annual data for France’s exports, imports and trade balance are provided in Table VF-4. France’s trade balance deteriorated sharply from 2007 to 2011 with the deficit increasing from €42,494 million in 2007 to €73,598 million in 2011. Annual growth rates of exports have not been sufficiently high to compensate for growth of imports driven in part by commodity price increases. In 2012, the trade deficit declined to €67,524 million with growth of exports of 3.1 percent and of imports of 1.4 percent.

Table VF-4, France, Exports, Imports and Balance Year € Millions and ∆%

	Exports € Millions	∆%	Imports € Millions	∆%	Balance € Millions
Oct 2013 12 Months	436,183		496,753		-60,570
Year
2012	441,299	3.1	508,823	1.4	-67,524
2011	428,237	8.4	501,835	12.1	-73,598
2010	395,037	14.0	447,479	14.2	-52,442
2009	346,481	-17.0	391,872	-17.3	-45,391
2008	417,636	2.7	473,853	5.5	-56,217
2007	406,487	3.0	448,981	5.8	-42,494
2006	394,621	9.5	424,549	10.4	-29,928
2005	360,376	4.4	384,588	9.6	-24,212
2004	345,256	5.4	350,996	7.0	-5,740
2003	327,653		327,884		-231

Source: France, Direction générale des douanes et droits indirects

http://lekiosque.finances.gouv.fr/Appchiffre/portail_default.asp

VG Italy. Table VG-IT provides percentage changes in a quarter relative to the same quarter a year earlier of Italy’s expenditure components in chained volume measures. GDP has been declining at sharper rates from minus 0.6 percent in IVQ2011 to minus 3.0 percent in IVQ2012, minus 2.5 percent in IQ2013, minus 2.2 percent in IIQ2013 and minus 1.8 percent in IIIQ2013. The aggregate demand components of consumption and gross fixed capital formation (GFCF) have been declining at faster rates. The rates of decline of GDP, consumption and GFCF were somewhat milder in IIIQ2013, IIQ2013 than in IQ2013 and the final three quarters of 2012.

Table VG-IT, Italy, GDP and Expenditure Components, Chained Volume Measures, Quarter ∆% on Same Quarter Year Earlier

	GDP	Imports	Consumption	GFCF	Exports
2013
IIIQ	-1.8	-1.2	-1.5	-5.1	0.0
IIQ	-2.2	-4.7	-2.5	-5.8	0.2
IQ	-2.5	-4.8	-2.6	-7.3	-0.6
2012
IVQ	-3.0	-6.9	-4.0	-8.1	0.8
IIIQ	-2.8	-7.5	-4.1	-8.7	1.8
IIQ	-2.6	-7.3	-3.6	-8.8	2.1
IQ	-1.8	-8.2	-3.4	-8.1	2.8
2011
IVQ	-0.6	-6.8	-2.0	-3.8	3.5
IIIQ	0.5	0.5	-1.0	-2.4	6.0
IIQ	1.1	3.7	0.4	-0.7	7.5
IQ	1.4	9.1	0.7	0.6	11.0
2010
IVQ	2.3	15.6	1.1	1.3	13.4
IIIQ	1.8	13.2	1.3	2.4	12.1
IIQ	1.8	13.4	0.8	0.9	12.0
IQ	0.9	7.0	1.0	-2.4	7.1
2009
IVQ	-3.5	-6.3	0.2	-8.2	-9.3
IIIQ	-5.0	-12.2	-0.8	-12.6	-16.4
IIQ	-6.6	-17.9	-1.4	-13.6	-21.4
IQ	-6.9	-17.2	-1.8	-12.4	-22.8
2008
IVQ	-3.0	-8.2	-0.9	-8.3	-10.3
IIIQ	-1.9	-5.0	-0.8	-4.5	-3.9
IIQ	-0.2	-0.1	-0.3	-1.5	0.4
IQ	0.5	1.7	0.1	-1.0	2.9

GFCF: Gross Fixed Capital Formation

Source: Istituto Nazionale di Statistica

12/1/13 http://cmpassocregulationblog.blogspot.com/2013/12/exit-risks-of-zero-interest-rates-world.html

The Markit/ADACI Business Activity Index decreased from 50.5 in Oct to 47.2 in Nov (http://www.markiteconomics.com/Survey/PressRelease.mvc/27e3c87dec6e4903a5c1c97d6247b44f). Phil Smith, Economist at Markit and author of the Italy Services PMI^®, finds the index suggesting doubts of Italy’s rebounding from recession (http://www.markiteconomics.com/Survey/PressRelease.mvc/27e3c87dec6e4903a5c1c97d6247b44f). The Markit/ADACI Purchasing Managers’ Index^® (PMI^®), increased from 50.7 in Oct to 51.4 in Nov for the highest reading in two-and-a-half years (http://www.markiteconomics.com/Survey/PressRelease.mvc/53345dfaaf1a40a8908cbf1d37a76343). New export orders grew at the fastest rate since Mar 2011. Phil Smith, Economist at Markit and author of the Italian Manufacturing PMI^®, finds squeeze of economic activity by pressure of input price inflation even with declining demand for inputs (http://www.markiteconomics.com/Survey/PressRelease.mvc/53345dfaaf1a40a8908cbf1d37a76343). Table IT provides the country data table for Italy.

Table IT, Italy, Economic Indicators

Consumer Price Index	Nov month ∆%: -0.3 Nov 12-month ∆%: 0.7 Blog 12/15/13
Producer Price Index	Oct month ∆%: -1.3 Oct 12-month ∆%: -2.7 Blog 12/1/13
GDP Growth	IIIQ2013/IIQ2013 SA ∆%: 0.0 IIIQ2013/IIIQ2012 NSA ∆%: minus 1.8 Blog 3/17/13 6/16/13 8/11/13 9/15/13 11/17/13 12/15/13
Labor Report	Oct 2013 Participation rate 63.6% Employment ratio 55.5% Unemployment rate 12.5% Blog 12/1/13
Industrial Production	Oct month ∆%: 0.5 12 months CA ∆%: -0.5 Blog 12/15/13
Retail Sales	Sep month ∆%: -0.3 Sep 12-month ∆%: -2.8 Blog 11/24/13
Business Confidence	Mfg Nov 98.1, Jun 92.3 Construction Nov 80.0, Jun 77.1 Blog 12/1/13
Trade Balance	Balance Sep SA €2131 million versus Aug €2506 Exports Sep month SA ∆%: 0.6; Imports Sep month ∆%: 1.9 Exports 12 months Sep NSA ∆%: 2.0 Imports 12 months NSA ∆%: -0.1 Blog 11/24/13

Links to blog comments in Table IT:

11/24/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-zero-interest-rates-world.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

9/15/13 http://cmpassocregulationblog.blogspot.com/2013/09/recovery-without-hiring-ten-million.html

8/11/13 http://cmpassocregulationblog.blogspot.com/2013/08/recovery-without-hiring-loss-of-full.html

6/16/13 http://cmpassocregulationblog.blogspot.com/2013/06/recovery-without-hiring-seven-million.html

3/17/13 http://cmpassocregulationblog.blogspot.com/2013/03/recovery-without-hiring-ten-million.html

Table VG-1 provides revised percentage changes of GDP in Italy of quarter on prior quarter and quarter on same quarter a year earlier. The GDP of Italy changed 0.0 percent in IIIQ2013 and fell 1.8 percent relative to a year earlier. Italy’s GDP fell 0.3 percent in IIQ2013 and fell 2.2 percent relative to a year earlier. Italy’s GDP fell 0.6 percent in IQ2013 and declined 2.5 percent relative to IQ2012. GDP had been growing during six consecutive quarters but at very low rates from IQ2010 to IIQ2011. Italy’s GDP has fallen in eight consecutive quarters from IIIQ2011 to IIQ2013 at increasingly higher rates of contraction from 0.2 percent in IIIQ2011 to 0.7 percent in IVQ2011, 1.1 percent in IQ2012 and 0.6 percent in IIQ2012 but at lower 0.5 percent in IIIQ2012. The pace of decline accelerated to minus 0.9 percent in IVQ2012 and 0.6 percent in IQ2013, declining to minus 0.3 percent in IIQ2013 and 0.0 percent in IIIQ2013. GDP contracted cumulatively 4.8 percent in eight consecutive quarterly contractions from IIIQ2011 to IIQ2013 at the annual equivalent rate of 2.4 percent. The yearly rate has fallen from 2.3 percent in IVQ2010 to minus 2.5 percent in IQ2013, minus 2.2 percent in IIQ2013 and minus 1.8 percent in IIIQ2013. The fiscal adjustment of Italy is significantly more difficult with the economy not growing especially on the prospects of increasing government revenue. The strategy is for reforms to improve productivity, facilitating future fiscal consolidation.

Table VG-1, Italy, GDP ∆%

	Quarter ∆% Relative to Preceding Quarter	Quarter ∆% Relative to Same Quarter Year Earlier
IIIQ2013	0.0	-1.8
IIQ2013	-0.3	-2.2
IQ2013	-0.6	-2.5
IVQ2012	-0.9	-3.0
IIIQ2012	-0.5	-2.8
IIQ2012	-0.6	-2.6
IQ2012	-1.1	-1.8
IVQ2011	-0.7	-0.6
IIIQ2011	-0.2	0.5
IIQ2011	0.3	1.1
IQ2011	0.1	1.4
IVQ2010	0.3	2.3
IIIQ2010	0.5	1.8
IIQ2010	0.6	1.8
IQ2010	0.9	0.9
IVQ2009	-0.1	-3.5
IIIQ2009	0.4	-5.0
IIQ2009	-0.3	-6.6
IQ2009	-3.5	-6.9
IVQ2008	-1.6	-3.0
IIIQ2008	-1.3	-1.9
IIQ2008	-0.5	-0.2
IQ2008	0.5	0.5
IV2007	-0.4	0.1
IIIQ2007	0.3	1.7
IIQ2007	0.2	2.0
IQ2007	0.0	2.4

Source: Istituto Nazionale di Statistica

Table VG-2 provides percentage changes in a quarter relative to the same quarter a year earlier of Italy’s expenditure components in chained volume measures. GDP has been declining at sharper rates from minus 0.6 percent in IVQ2011 to minus 3.0 percent in IVQ2012, minus 2.5 percent in IQ2013, minus 2.2 percent in IIQ2013 and minus 1.8 percent in IIIQ2013. The aggregate demand components of consumption and gross fixed capital formation (GFCF) have been declining at faster rates. The rates of decline of GDP, consumption and GFCF were somewhat milder in IIIQ2013, IIQ2013 than in IQ2013 and the final three quarters of 2012.

Table VG-2, Italy, GDP and Expenditure Components, Chained Volume Measures, Quarter ∆% on Same Quarter Year Earlier

	GDP	Imports	Consumption	GFCF	Exports
2013
IIIQ	-1.8	-1.2	-1.5	-5.1	0.0
IIQ	-2.2	-4.7	-2.5	-5.8	0.2
IQ	-2.5	-4.8	-2.6	-7.3	-0.6
2012
IVQ	-3.0	-6.9	-4.0	-8.1	0.8
IIIQ	-2.8	-7.5	-4.1	-8.7	1.8
IIQ	-2.6	-7.3	-3.6	-8.8	2.1
IQ	-1.8	-8.2	-3.4	-8.1	2.8
2011
IVQ	-0.6	-6.8	-2.0	-3.8	3.5
IIIQ	0.5	0.5	-1.0	-2.4	6.0
IIQ	1.1	3.7	0.4	-0.7	7.5
IQ	1.4	9.1	0.7	0.6	11.0
2010
IVQ	2.3	15.6	1.1	1.3	13.4
IIIQ	1.8	13.2	1.3	2.4	12.1
IIQ	1.8	13.4	0.8	0.9	12.0
IQ	0.9	7.0	1.0	-2.4	7.1
2009
IVQ	-3.5	-6.3	0.2	-8.2	-9.3
IIIQ	-5.0	-12.2	-0.8	-12.6	-16.4
IIQ	-6.6	-17.9	-1.4	-13.6	-21.4
IQ	-6.9	-17.2	-1.8	-12.4	-22.8
2008
IVQ	-3.0	-8.2	-0.9	-8.3	-10.3
IIIQ	-1.9	-5.0	-0.8	-4.5	-3.9
IIQ	-0.2	-0.1	-0.3	-1.5	0.4
IQ	0.5	1.7	0.1	-1.0	2.9

GFCF: Gross Fixed Capital Formation

Source: Istituto Nazionale di Statistica

Table VG-3 provides percentage changes in a quarter relative to the same quarter a year earlier for GDP and value added components. Percentage declines of industry have been sharper from IVQ2011 to IIIQ2013 than for services.

Table VG-3, Italy, GDP and Valued Added of Components, Chained Volume Measures, Quarter ∆% on Same Quarter Year Earlier

	Agriculture	Industry	Services	VAT and Net Taxes	GDP Market Prices
2013
IIIQ	-0.7	-3.5	-0.9	-4.4	-1.8
IIQ	-3.1	-3.6	-1.4	-4.6	-2.2
IQ	-0.2	-4.0	-1.6	-5.5	-2.5
% Value Added 2012	2.1	24.2	73.7
2012
IVQ	-6.9	-4.2	-2.2	-5.2	-3.0
IIIQ	-5.9	-3.3	-2.4	-4.3	-2.8
IIQ	-1.4	-4.3	-1.5	-5.5	-2.6
IQ	-3.5	-3.8	-0.6	-4.5	-1.8
2011
IVQ	1.3	-1.8	0.3	-3.8	-0.6
IIIQ	0.9	-0.3	1.0	-1.4	0.5
IIQ	-0.4	1.4	1.2	0.0	1.1
IQ	0.3	3.2	0.9	1.3	1.4
2010
IVQ	0.2	3.7	1.9	1.7	2.3
IIIQ	-1.5	4.6	1.0	1.6	1.8
IIQ	0.1	4.7	0.8	2.4	1.8
IQ	0.5	1.2	0.8	0.7	0.9
2009
IVQ	-3.7	-7.4	-2.4	-2.0	-3.5
IIIQ	-0.3	-13.3	-2.1	-4.3	-5.0
IIQ	-4.1	-16.7	-3.0	-5.6	-6.6
IQ	-1.9	-16.5	-3.3	-6.6	-6.9
2008
IVQ	2.2	-8.2	-1.3	-2.1	-3.0
IIIQ	1.0	-3.9	-1.2	-1.7	-1.9
IIQ	2.3	-0.6	0.0	-1.4	-0.2
IQ	0.1	1.0	0.4	-0.1	0.5

Source: Istituto Nazionale di Statistica