Indicator scoreboard
EMU - December harmonized index of consumer prices rose 0.1 percent and 2.6 percent when compared to last year. Food, alcohol and tobacco prices, which were the primary cause of the increase, were up 0.4 percent. Energy product prices fell 1.6 percent. Core inflation excluding energy, food, alcohol and tobacco rose 0.1 percent on the month while the annual rate remained unchanged at 1.5 percent. Excluding energy alone, HICP rose 0.2 percent with the annual rate up 1.7 percent. Nine of the 11 countries reported annual inflation rates above 2.0 percent, compared to all 11 in November. The annual rate of increase fell in 9 out of 11 EMU members while it remained unchanged in one and rose in one.

December M3 money supply growth rate slowed to 4.9 percent when compared to last year. December seasonally adjusted M3 rose only 0.1 percent from the upwardly revised 0.4 percent in November. In the three months to December, M3 rose 5 percent when compared with last year. This remains above the ECB's 4.5 percent growth reference value.

November merchandise trade surplus with the rest of the world was E1.7 billion, about half the E3.2 billion surplus of a year earlier. The lower trade surplus was mainly due to a stronger increase in imports, up 20 percent, than in exports, which were up 17 percent.

Germany -December Ifo Institute's west German business sentiment index fell to 96.5. This was the seventh consecutive month of decline and the lowest level since October 1999 with sentiment on both business expectations and on current conditions declining. Future expectations by west German businesses fell for the second month in a row, down to 101.1 from 101.6 in November, while sentiment on current business conditions fell to 92.0 from 92.4 in November. The December's decline shows that west German business sentiment remains in a downtrend, pointing to a near term slowing of growth in the EMU's largest economy.

November pan-German real seasonally adjusted construction orders rose 0.5 percent but dropped 4.0 percent when compared with last year. This was the third month in succession that construction orders rose. A decline in November orders in west Germany (down 1.0 percent) was offset by a rise in the east (up 5.9 percent). Among pan-German construction categories, November total structural construction orders rose 1.3 percent, but were down 7.0 percent on the year. November housing construction orders fell 4.2 percent but stood 19.7 percent below the level of a year earlier.

December import prices dropped 2.2 percent but were up 8.2 percent when compared with last year. The stronger euro and lower oil prices combined to drive prices down. Excluding oil and oil products, import prices remained unchanged in December and were up 6.9 percent when compared with last year. Seasonally adjusted import prices fell 2.6 percent in December and were 8.2 percent above the year earlier level. Seasonally adjusted export prices fell 0.4 percent but rose 3.3 percent on the year.

December seasonally adjusted producer prices fell 0.2 percent but rose 4.2 percent on the year. In November, seasonally adjusted producer prices rose 0.3 percent and 4.6 percent on the year. Over the six months to December, pan-German producer prices rose at a 4.8 percent annualized rate, down from the 6.0 percent rate in November and the year 2000 high of 6.5 percent in October. December not seasonally adjusted producer prices dropped 0.3 percent on the month and 4.2 percent on the year.

January preliminary seasonally adjusted consumer price index rose 0.4 percent and 2.4 percent when compared with last year. The rate of inflation over the past six months was 2.6 percent. December seasonally adjusted consumer prices remained unchanged and rose 2.4 percent on the year.

France - December seasonally and workday adjusted consumer spending on manufactured goods fell 0.3 percent but rose 2.4 percent when compared with last year. The recovery from the oil price shock remained hesitant. December's decline was led by the ongoing slide in auto sales, down 1.0 percent on the month and 4.4 percent lower on the year. Excluding autos, auto parts and pharmaceuticals, spending on manufacturing goods was up 0.2 percent in December.

Italy - November nominal unadjusted retail sales rose 1.5 percent when compared with last year. Retail sales increased in 12 of 15 sectors. The strongest increases by category came in food sales, up 2.8 percent; pharmaceutical products, up 1.9 percent; and clothing, also up 1.9 percent.

Britain - December non-European Union merchandise trade deficit widened to Stg2.821 billion. Fuel exports were significantly lower, reflecting a fall in both volume and price of crude oil exports. The value of exports to non-EU countries fell 6.0 percent while imports increased by 0.6 percent. The November whole world deficit narrowed to Stg2.148 billion from Stg2.467 billion in the previous month. The November balance with European Union trading partners showed a surplus of Stg169 million, after a deficit of Stg45 million in October.

Fourth quarter preliminary gross domestic product rose 0.3 percent and was up 2.4 percent when compared with last year. This is down from the third quarter increase of 0.7 percent and 3.0 percent on the year. The quarterly growth rate was the weakest since the fourth quarter of 1998 while the annual pace was the lowest since the second quarter of 1999. The slowdown was quite broadly based. It was attributed it to weakness in services growth and an estimated fall in production output. In 2000 as a whole, GDP grew by 3.0 percent, higher than 1999's 2.3 percent growth rate.

Belgium - December seasonally adjusted Belgian National Bank's composite leading industry indicator fell 3.6 points to plus 0.2, its lowest level since June 2000. The manufacturing sector indicator fell to minus 1.5 from plus 3.5 in November, due to a deterioration of the manufacturing climate in most branches. Export orders fell in December - a negative sign for EMU industry growth. Expectations for demand and employment dipped somewhat. The Belgian manufacturing sector is widely seen as a leading cyclical indicator for the EMU, given its concentration on semi-finished goods and the large share of exports to major EMU economies. In recent years, the central bank's industry indicator has shown a fairly close correlation to EMU industry confidence trends six months later.

Asia
Japan - November seasonally adjusted tertiary industry activity index, which tracks service companies from real estate agents to insurers, rose 0.6 percent. The index shows that companies and consumers increased spending on electricity, travel and other services. The all industry activity index, which adds construction work, industrial production and government spending to the tertiary index, rose 0.4 percent in November.

Fourth quarter prices paid to producers in the final stage of production rose 1.5 percent and were 5.2 percent higher when compared with a year ago. At the same time, intermediate materials rose 2.6 percent in the quarter while raw materials rose 2.9 percent.

December seasonally adjusted merchandise trade surplus narrowed to 457.6 billion yen ($3.9 billion), the smallest trade surplus in almost three years. Exports fell 0.3 percent while imports rose 4 percent. Exports, measured by volume, rose 1.4 percent from a year earlier, and are rising at the slowest rate in about a year. While export volumes to Asia rose 4.4 percent from a year ago, shipments to the United States fell for a fourth straight month, the longest streak since a 15-month slide that ended in August 1996. For all of last year, the surplus narrowed to 10.7 trillion yen from 12.3 trillion yen in 1999, as imports rose almost twice as fast as exports. Imports rose 16 percent, to the second highest on record. Exports increased 8.6 percent, led by electronics parts, which rose 22.8 percent and accounted for about one-fifth of growth.

January seasonally adjusted Tokyo consumer prices rose 0.3 percent. This was the third straight month that prices increased as the cost of fresh food rose. Prices were 0.4 percent lower than a year ago, and have fallen from year ago levels for a record 17 months. Consumer prices fell a record one percent last year. The January Tokyo core index dropped 0.4 percent and fell 0.8 percent when compared with last year. Nationwide, seasonally adjusted December consumer prices rose 0.1 percent. Excluding fresh food, prices were unchanged. From a year earlier, overall prices fell 0.2 percent and excluding fresh food dropped 0.6 percent. The core CPI fell 0.1 percent on the month and 0.6 percent when compared with last year.

December seasonally adjusted department store and supermarket sales fell 4.5 percent after declining a revised 0.4 percent in November. At stores open at least one year, sales fell 5.4 percent from a year earlier. On a same store basis, sales have fallen from year ago levels for 32 straight months. Total seasonally adjusted retail sales - which include sales of household electrical products makers and auto dealers - fell 0.4 percent from November. Sales at large retail stores fell 4.6 percent in the year ended December 31 on a same store basis, the ninth straight yearly decline.

Australia - Fourth quarter import price index soared 6.7 percent, posting its biggest quarterly rise in 10 years as the low Australian dollar pushed up prices. Import prices rose 15.8 percent from a year ago. In the last three months of 2000, the Australian dollar, which fell to a record-low 50.71 U.S. cents November 22, made imports more expensive.

Fourth quarter consumer prices rose 0.3 percent, down from a 3.7 percent increase the previous quarter. In the fourth quarter, clothing and footwear prices fell 0.4 percent, vegetables dropped 2.7 percent, and telecommunication costs were down 0.8 percent. They were offset by food, which rose 0.8 percent, and alcohol and tobacco, up 1 percent. The new goods and services tax introduced in July replaced a range of wholesale sales taxes. That saw the price of cars and electronic goods fall as the 22 percent wholesales tax was replaced with a 10 percent GST. From a year ago, prices were 5.8 percent higher. While that is almost double the central bank's 3 percent limit for inflation, it includes the impact of a 10 percent tax on goods and services, introduced in July.

Americas
Canada - November retail sales rose 0.4 percent following a 0.7 percent decline in October. In constant dollars, sales were down 0.1 percent when compared with October. The only significant price increases in November were in the automotive sector. Sales in the automotive sector rose 1.6 percent, the largest November sales increase, followed by weaker gains in drug stores (up 0.5 percent) and furniture stores (up 0.3 percent). General merchandise stores were down 1.5 percent and stores classified as other retail were down 0.9 percent.

November seasonally adjusted manufacturing shipments rose 0.3 percent. Rising prices in the refined petroleum and coal products industry led to the modest increase. Excluding the increase in refined petroleum and coal products, shipments were virtually unchanged from October. Shipments increased in 16 of the 22 major groups, representing 51 percent of total shipments. Shipments excluding the automotive sector rose 0.7 percent. Manufacturers' unfilled orders edged down 0.1 percent. Manufacturers in the electrical and electronic products industry saw the largest decline, down 2.1 percent from October. The motor vehicle industry, suffering from continued weak demand for heavy trucks, reported a decline of 3.7 percent. Offsetting movements were seen in the aircraft and parts industry, up 0.4 percent, and the primary metal industry, up 6.1 percent, as large contracts were received. New orders slipped 0.1 percent in November, largely due to the transportation industry and in particular the motor vehicle parts and accessories industry. The machinery industry also contributed to the lower level of orders.

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