The end of the last week was rich in economic information. Let us start with composite confidence indicator in the Czech republic. The composite indicator decreased slightly in April 2002 (from 3 points in previous month to 2 points), which was influenced by less favorable development of the indicator in industry (from 6 to –2). More favorable results were in other components. In construction enterprises the confidence got better from –12 to –5 points, in trade from 19 to 21 and consumers evaluated their situation at –3 following –6 points in March.
The lower house of Parliament passed a bill calling for a complete ban on tobacco advertising. The act would also ban sponsorship leading to tobacco promotion. The bill from KDU-CSL was also approved by CSSD and KSCM. The most of unionists did not vote, ODS was against.
U.S. Economy expanded at 5.8% annual rate in the first quarter of 2002 (preliminary quarter-on-quarter annualized change). Measured by the Czech and European standards, the GDP would rose by 1.6% y/y. Half of the change was a result of change in business inventories.
On the contrary, consumer confidence indicator of the University of Michigan provides another signals. The value of the index decreased to 93 points in April from 95.7 in March in the USA.
Britain’s economy barely rose in the first quarter of 2002. U.K. GDP grew 0.1% in comparison with previous quarter. Year-on-year GDP rose by 1.0% following 1.6% rate in last quarter of 2001.
Unlike the Czech and Polish central bank, Slovakia and Sweden decided to up their key interest rates. The national bank of Slovakia increased its rates by 50 bps (the key 2-week repo rate at 8.25%) in order to fight external deficit issue. Swedish Riksbank raised its rates by 25 bps in concerns of inflation pressures. The key repo rate stands at 4.25%.
Eurozone’s money supply (M3), which is one of the pillars of the ECB’s monetary policy, eased its dynamics in March to 7.3% from 7.4% in February. The figure still remains well above the bank’s 4.5% benchmark for its inflation barometer. However, the money supply growth would not create a risk for inflation target. ECB’s chief economist Otmar Issing said that the inflation in Eurozone would fall under 2% in forthcoming months.
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