by Edward Hugh: Barcelonabr /br /br /pa href="http://3.bp.blogspot.com/_ngczZkrw340/SlmdGD2bh-I/AAAAAAAAOoo/P8vnyB3RTno/s1600-h/bulgaria+population.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 258px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5357485959172294626" border="0" alt="" src="http://3.bp.blogspot.com/_ngczZkrw340/SlmdGD2bh-I/AAAAAAAAOoo/P8vnyB3RTno/s400/bulgaria+population.png" //abr /br /br /The International Monetary Fund this week forecast the recession in Bulgaria would be deeper than it previously predicted. Such a decision should come as no surprise to anyone, since the country's economic dynamics in both the short and long term look extremely unstable, and Bulgaria is now almost certainly headed towards a series of more or less hair-raising roller-coaster rides. Even the briefest of glances at the population chart above should lead even the most sceptical among us to stop and think a little about the possible economic implications of such an appauling demographic outlook. As can be seen, the opening to the west brought a sharp outflow of people in the late 1980s (mainly ethnic Turks), but the important thing ...

French business confidence rose for the second month in May as record low interest rates and falling inflation appeared to be encouraging French consumers to start shopping again.. The Insee sentiment index - based on a survey among 4,000 manufacturers rose to 72 from 71 in April.br /br /pa href="http://2.bp.blogspot.com/_ngczZkrw340/Shz6mPuvaOI/AAAAAAAAOEM/CrtzAmlphDY/s1600-h/france+business+confidence.png"img id="BLOGGER_PHOTO_ID_5340418793119115490" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 400px; CURSOR: hand; HEIGHT: 213px; TEXT-ALIGN: center" alt="" src="http://2.bp.blogspot.com/_ngczZkrw340/Shz6mPuvaOI/AAAAAAAAOEM/CrtzAmlphDY/s400/france+business+confidence.png" border="0" //abr /Consumer confidence also rose to a 13-month high, according to a separate gauge of consumer sentiment published today - it was up at minus 40, from minus 41 in April. The level is still, however, not far off historic lows.br /br /a href="http://2.bp.blogspot.com/_ngczZkrw340/Shz7oLxXLGI/AAAAAAAAOEU/DwxV6QUYuKU/s1600-h/france+consumer+confidence.png"img id="BLOGGER_PHOTO_ID_5340419925927734370" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 400px; CURSOR: hand; HEIGHT: 213px; TEXT-ALIGN: center" alt="" src="http://2.bp.blogspot.com/_ngczZkrw340/Shz7oLxXLGI/AAAAAAAAOEU/DwxV6QUYuKU/s400/france+consumer+confidence.png" border="0" //abr /br /French consumer spending increased in April as government incentives boosted car sales and slowing inflation helped cushion ...

by Edward Hugh: Barcelonabr /br /Italy's recession deepened at the start of 2009, with first-quarter gross domestic product falling to its worst level since at least 1980, confirming the impression that Europe's fourth-largest economy is now headed for its worst downturn since World War II. Preliminary data from the national statistics office (Istat) show that Italian GDP fell 2.4% in the first quarter when compared with the last quarter of 2008. This follows a downwardly revised 2.1% contraction in the fourth quarter of last year. Annualised this means a 9.6% contraction rate during the three months, which is very high indeed.br /br /pa href="http://4.bp.blogspot.com/_ngczZkrw340/Sg0skEokxwI/AAAAAAAAN6U/_zHT8IVLSh4/s1600-h/italy+GDP+one.png"img id="BLOGGER_PHOTO_ID_5335970131734742786" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 400px; CURSOR: hand; HEIGHT: 229px; TEXT-ALIGN: center" alt="" src="http://4.bp.blogspot.com/_ngczZkrw340/Sg0skEokxwI/AAAAAAAAN6U/_zHT8IVLSh4/s400/italy+GDP+one.png" border="0" //abr /br /br /Year on year GDP fell by 5.9%, which was also the sharpest drop since Istat's most recent data series starts in 1980 - or for ...

by Edward Hugh: Barcelonabr /br /The title to this post poses an interesting question I think, since the answer you give to it would seem to depend more on the meaning you attribute to the word "really" than on any consensually agreed objective fact. This is especially the case since Spain itself has at least two "official" unemployment numbers, so the backround to (and reason for my asking) the question is the apparent divergence between these two numbers (one from the national statistics office, and one from the employment office INEM), both of which were given extensive international press coverage recently, with the ensuing "spread" between one reading and the other causing general confusion and even leading some to question the very validity of the whole Spanish "headcount" process. br /br /As we shall see, what we have here is not necessarily a simple "fudging" of numbers, but rather ...

by Edward Hugh: Barcelonabr /br /With capital inflows to the CEE economies slowing to a trickle in Eastern Europe, a sharp correction is now underway in most countries' external imbalances and in particular in their current-account deficits. For the CEE-6 (Poland, Czech Republic, Hungary, Romania, Bulgaria, Turkey), net private capital flows are forecast to slow to $59.5 billion in 2009, down from an estimated $161.9 billion in 2008, according to estimates from the Institute For International Finance. The basic concern is that those countries with significant external deficits are extremely vulnerable to foreign capital reversals, especially in the current environment of global credit tightening.br /br /br /FDI flows (which are generally considered more stable and less susceptible to rapid outflows than other capital flows) have been the main form of financing for current-account deficits in recent years, but such inflows are set to slow sharply in 2009. The Economist estimates ...

by Edward Hugh: Barcelonabr /br /br /blockquoteIn view of Greece's EMU membership, the availability of external financing is not a concern, but the correction of cumulating indebtedness could weigh appreciably on growth going forward. While the risk of transmitting vulnerabilities to the euro area is very small reflecting Greece’s small relative size, large persistent current account deficits would increase the vulnerabilities to a reversal in market sentiment, leading to a corrective retrenchment of private sector balance-sheets in the face of rising indebtedness, and a possible appreciable rise in the cost of funding over time. These developments would have significant negative implications for growth.br /a href="http://www.imf.org/external/pubs/cat/longres.cfm?sk=21937.0"Greece: 2007 Article IV Consultation/a - IMF Staff Report/blockquotepbr /br //ppa href="http://1.bp.blogspot.com/_ngczZkrw340/SUEsR712NQI/AAAAAAAALuU/VGFiqyCyzBw/s1600-h/bond+spreads+2.png"img id="BLOGGER_PHOTO_ID_5278548924887872770" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 320px; HEIGHT: 170px; TEXT-ALIGN: center" alt="" src="http://1.bp.blogspot.com/_ngczZkrw340/SUEsR712NQI/AAAAAAAALuU/VGFiqyCyzBw/s320/bond+spreads+2.png" border="0" //abr /The above quited paragraph from the IMF is a very good example of what used to be ...

by Edward Hugh: Barcelonabr /br /br /Well, before I go any further, yes you read the header right, with the contraction of 0.1% in Q3 over Q2 (seasonally and working day adjusted data) reported by the national statistics office (KSH) today (Tuesday) the Hungarian economy has now entered its strongsecond/strong recession since the start of 2007, since data revisions accompanying today's GDP detailed results from KSH show that they now estimat the economy contracted in strongboth/strong Q1 and Q2 of 2007 (by 0.2% in each case), thus satisfying the normal technical criterion for declaring a recession. Somehow I doubt the Hungarian press are filled today with headlines about this juicly little detail.br /br /br /pa href="http://4.bp.blogspot.com/_ngczZkrw340/ST5xOIDvDbI/AAAAAAAALr0/p6-CDg5cYwY/s1600-h/hungary+q-o-q.png"img id="BLOGGER_PHOTO_ID_5277780300820057522" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 320px; CURSOR: hand; HEIGHT: 159px; TEXT-ALIGN: center" alt="" src="http://4.bp.blogspot.com/_ngczZkrw340/ST5xOIDvDbI/AAAAAAAALr0/p6-CDg5cYwY/s320/hungary+q-o-q.png" border="0" //abr /br /While the Q1/Q2 2007 detail is a purely technical recession, in the sense that ...

by Edward Hugh: BarcelonaItaly, which is still the eurozone's third biggest economy, slipped into a recession in the third quarter. The Italian economy fell into what is now its fourth recession in less than a decade as gross domestic product shrank 0.5 percent from its level in the second quarter, when it contracted a revised 0.4 percent, the national statistics office said today. This is already Italy's worst recession since 1992, and there is evidently more and worse to come.Italy effectively followed Germany, Europe's largest economy, in posting two consecutive quarters of contraction -- the technical definition of a recession. Spain contracted on the quarter, while France narrowly avoided recession by posting a slender 0.1% expansion after contracting in the second quarter.From the third quarter of 2007 the economy contracted 0.9 percent, and this was the sharpest ...

Hungarian manufacturing continued to contract in October following a shocking performance in September, while exports drop sharply in the midst of a looming global manufacturing recession. All of which indicates that the real economy impacts of the recent financial turbulence is now about to make its presence felt. I think we are in for a real shocker in Hungary. October PMI Down Hungary's manufacturing industry contracted sharply in October, according to the latest PMI reading, which fell 5.2 points to hit 44.7 in October - a historic low, and 0.8 points below the previous worst reading registered in October 1998, according to the latest data from the Hungarian Association of Logistics, Purchasing and Inventory Management (HALPIM). Sharp Industrial Output Contraction In September Hungarian industrial production dropped the most in more than 16 years in September as the global financial crisis hit the economy and slowing growth in western Europe curbed demand for exports. Production ...

French business confidence fell to the lowest in almost 15 years as the global credit crisis worsened, threatening to deepen a likely recession in the euro region's second-largest economy. br /br /An index of sentiment among 4,000 manufacturers declined to 88 in October from 91 the previous month, according to Insee, the Paris-based national statistics office. The reading was the lowest since December 1993. br /br /a href="http://2.bp.blogspot.com/_ngczZkrw340/SQBrddlqhCI/AAAAAAAALJ8/_kqm5UNq5Cg/s1600-h/French+bus+con.png"img id="BLOGGER_PHOTO_ID_5260322518671721506" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 320px; CURSOR: hand; HEIGHT: 170px; TEXT-ALIGN: center" alt="" src="http://2.bp.blogspot.com/_ngczZkrw340/SQBrddlqhCI/AAAAAAAALJ8/_kqm5UNq5Cg/s320/French+bus+con.png" border="0" //abr /div/divbr /br /The report also showed that manufacturers expect their prices to fall for a second month as crude oil and commodities costs retreat. Crude prices have shed more than 50 percent since a July 11 record of $147.27 a barrel, helping bring France's inflation rate to 3.3 percent in September from a 12-year high of 4 percent in July. Declining prices have ...