Eurozone recession fears, and other economics news to read this week
Top economy stories: Eurozone recession fears continue; Chinese exports grew in November; and more. Image: Unsplash/Ibrahim Boran
- This weekly round-up brings you the latest stories from the world of economics and finance.
- Top economy stories: Eurozone recession fears continue; Chinese exports grew in November; US trade deficit grows more than expected.
1. Eurozone recession fears continue
The Eurozone's downturn in business activity slowed in November, new data from the Composite Purchasing Managers' Index showed this week. While HCOB's composite PMI, compiled by S&P Global, rose to 47.6 in November, up from 46.5 in October, it still sits below the 50 mark that separates growth from contraction.
The economy contracted 0.1% in the last quarter, and with the composite PMI generally viewed as a good marker of economic health, it suggests the Eurozone is on track to do so again. Another such contraction would meet the technical definition of a recession.
The service industry in particular continues to struggle, as Cyrus de la Rubia, Chief Economist at Hamburg Commercial Bank explains:
"The service sector maintained its downward slide in November. The modest improvement of the activity index does not leave much room for optimism regarding a swift recovery in the immediate future."
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2. Chinese exports grew in November
Chinese exports grew in November, up 0.5% from a year earlier, with imports falling 0.6%, marking the first period of growth in six months.
"The improvement in exports is broadly in line with market expectations... sequential growth in China's exports in the past few months has strengthened," said Zhiwei Zhang, Chief Economist at Pinpoint Asset Management. "There are green shoots in other Asian countries' export data as well in recent months."
Challenges remain, however, with the country's official purchasing managers' index showing new export orders shrank for a ninth month in a row.
3. News in brief: Stories on the economy from around the world
South Korean inflation eased in November, with the Consumer Price Index hitting 3.3%. That marks a 0.6% fall on a monthly basis, the first such drop since November last year and the biggest decline since October 2020.
A leading business group in Thailand has said it expects the economy to grow 2.5%-3% this year.
Australia's economy continued to grow in the third quarter, but below expectations, recording just 0.2% growth in July-September compared to the previous quarter. Weaker exports and flat household spending were key hits to growth, reports Reuters.
The Bank of Canada has held its key overnight interest rate at 5%, the third such hold in a row, after 0.25 point rises in June and July. The bank said it was still prepared to raise rates further if necessary.
The Mexican financial system remains resilient, despite global economic uncertainty, the governor of the country's central bank said on 6 December.
Data from the recruitment platform Indeed suggests that the UK's labour market remains tight, despite a fall in job postings this year.
The US trade deficit grew more than expected in October, with a decline in exports, growing 5.1% to hit $64.3 billion.
Consumer confidence in South Africa has reached its lowest fourth-quarter mark in more than 20 years, reports Bloomberg.
German industrial output dropped in October, the fifth such drop in a row. Bloomberg suggests that Europe's biggest economy could be on track for recession.
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Japanese GDP fell faster than initially estimated in the third quarter of 2023, according to revised data.
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