Regional economic recovery remains sluggish

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Last month, economists were encouraged by EMEA’s fiscal figures, as regional business and consumer confidence rose in October, while consumer prices remained stable. Such news was certainly welcomed by global economists and regional governmental officials, in the midst of Europe’s double-dip recession.

But, did such trends continue in November? Are consumer prices presently higher than usual? Does unemployment appear to be declining on a steady basis? Have housing values begun to rise throughout the region?

For answers to such questions, the following statistics, concerning regional business and consumer confidence, inflation, employment, and housing prices were published in early December.

Euro Zone:
As a surprise to some global economists, the Euro Zone’s business and consumer sentiment index rose slightly in November, climbing to 85.7, the first month-to-month increase recorded since February. Although the upturn may be a sign of regional economic recovery, the index is still well below its long-term average of 100. In fact, the measurement has not risen above 100 since August 2011. Three of the index’s five sub-indices also augmented last month, including industrial, retail trade, and services confidence, rising to -15.1, -14.9, and -11.9, respectively. The index’s two other sub-indices, construction and consumer confidence, continued to decline, falling to -35.5 and -26.9, respectively. Unfortunately, there is presently no indication that the sentiment index will rise above its long-term average of 100 in the near future.

During the first week of December, France’s latest inflation figures were released to the general public, revealing that November’s EU-harmonized Consumer Price Index (CPI) matched September’s rate, at 114.0. According to the EU-harmonized index, consumer prices have risen by 1.6 percent since November 2011, the lowest year-ago increase recorded since August 2010. To compare, France’s total CPI, including tobacco, has augmented by 1.4 percent since November 2011. Excluding tobacco and energy, the nation’s annual CPI rose by 1.3 percent last month, the lowest upsurge of 2012. Many global economists anticipate France’s annual inflation figures will remain high during the first quarter of 2013.

According to Bundesbank, Germany’s national unemployment rate remained unchanged for the second consecutive month in November at 6.9 percent. As usual, joblessness varied by region, as West Germany’s unemployment rate was lower than the national average, at six percent, while East Germany’s jobless rate was considerably higher, at 10.6 percent. In all, 2.94 million Germans were without work last month, an increase of 5,000, when compared to October’s figures. The total number of unemployed citizens has not declined on a month-to-month basis since March, while the national unemployment rate has ranged from 6.8 to 6.9 percent throughout 2012. As Europe’s recession continues, most economists do not presently foresee a considerable variation in employment trends anytime soon.

For the first month since July, Spain’s business climate indicator increased on a month-to-month basis in November, climbing from -18 to -16, the highest rate since May. The escalation was unanticipated, as Spain’s unemployment rate remains above 25 percent in the midst of its double-dip recession. Despite the nation’s weakened economy, each of the indicator’s four sub-indexes, consumption, investment, intermediate goods, and other goods, also increased last month, rising to -11, -15, -22, and -2, respectively. Although the upsurges were welcomed, a majority of economists do not perceive a steady rise in business confidence in the future, as national unemployment will likely continue to linger above the norm well into 2013.

United Kingdom:
As the United Kingdom’s economic recovery continues, national housing prices remain low, according to the Nationwide Building Society’s latest statistics. The society has revealed that its house price index was 327.6 in November, nearly matching October’s index of 327.5. In October, the average price of a property was £164,153. Since then, the average price has declined, falling to £163,853 in November, a decrease of nearly £2,000, when compared to November 2011’s data. Since July, the house price index has increased by 4.5 basis points; however, to compare, last month’s index was 1.2 percent lower than November 2011’s rate. As a result of the region’s ongoing recession, some economists believe national housing prices will not rebound for another two to five years, at least.

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