In the 16-nation eurozone, the inflation rate for July was confirmed at 1.7% on a year-on-year basis, after rising 1.4% in June. This was the fastest pace in 20 months as more expensive fuel offset the downward pull on the index from cheaper clothes.
In construction , output increased 2.7% in June, the most in three months, after falling 0.7% in May, and was mainly led by Spain. On a year-on-year basis, output rose 3.1% in June after falling 3.2% in May.
The euro area registered a trade surplus of €2.4 billion in June, as exports rose 5.2% over the previous month, mainly due to exports from Germany. This was higher than the expected €1bn and higher than the €3.3bn deficit registered in May.
In the US, wholesale costs increased for the first time in four months in July as the Producer Price Index increased as expected by 0.2% after falling 0.5% the previous month. Excluding volatile food and energy costs, prices rose by 0.3%, higher than the expected 0.1%. On a yearly basis, prices rose 4.2% in July.
In the manufacturing sector, industrial production rose 1% in July. This was twice as much as forecasted and followed a 0.1% fall the previous month. In the week ended August 14, jobless claims rose to 500,000, the highest level since November, from a revised 488,000 previously. The Philadelphia Fed Manufacturing Index fell for the first time in a year, to -7.7 in August from 5.1 in July.
In the UK, the inflation rate slowed in July as expected, but stood above the 2% target. Price pressures as measured by the Consumer Price Index fell by 0.2% in July, after rising by just 0.1% in May. On an annual basis, inflation eased to 3.1% in July, just below the 3.2% rate registered the previous month.
Retail sales increased three times as fast as forecast. Sales excluding auto fuel rose 0.9% in July, much higher than the expected 0.2%, but lower than the 1.1% rise in June.
Public sector net borrowing in July was £3.2bn. This was lower than the £4.8bn forecast and the £13.9bn in June. While public borrowing was lower than a year ago, the figures still revealed the challenging task the government faces to reduce its 2009/2010 record budget deficit.
This article has been prepared by Bank of Valletta plc for your general information only.