Indicator scoreboard
EMU - August harmonized index of consumer prices increase eased to 2.7 percent when compared with last year. It was the third successive month-to-month drop, but it still leaves the annual rate above the European Central Bank's target ceiling of 2 percent.

Germany - August wholesale price index fell 0.3 percent but was up 1.5 percent when compared with last year. In July, the WPI was up 2.2 percent on the year compared with a 3.1 percent rise in 3.1.

August Ifo business sentiment index slipped to 89.5 from 89.8 in July. The August decline was due to a further deterioration in sentiment on current economic conditions. That subindex fell to 83.3 from 84.7. The expectations subindex, on the other hand, rose for the second straight month, to 95.9 from 95.0. Normally, a rise in the expectations index is an indication that the economy is nearing its cyclical bottom. It is not clear to what extent the August Ifo index was influenced by the attacks. Between 20 to 25 percent of survey responses were received after the attacks.

Italy - Second quarter seasonally adjusted gross domestic product was unchanged and up 2.1 percent on the year. There were two less working days in the second quarter than in the first. Exports shrank 1.3 percent but rose 8.8 percent on the year, while imports fell 0.2 percent from the previous quarter and advanced 2.6 percent on the year. Domestic consumption rose 0.5 percent and increased 1.3 percent on the year. Consumer spending rose 0.6 percent in the quarter, while government spending rose 0.1 percent. Capital investment fell 0.3 percent in the quarter and rose 1.3 percent on the year.

July seasonally and workday adjusted industrial production fell 0.7 percent and 2.1 percent when compared with last year. Seasonally adjusted consumer goods output fell 2.2 percent but rose an unadjusted 2.1 percent on the year. Output of investment goods fell an adjusted 1.2 percent, up an unadjusted 2.2 percent on the year, while intermediate goods increased by 0.2 percent and 1.2 percent on the year.

Britain - August retail price index excluding mortgage interest payments (the Bank of England's main gauge of inflation) rose 0.4 percent and 2.6 percent when compared with last year. This is slightly above the Bank's 2.5 percent inflation target. The retail price index also rose 0.5 percent but 2.1 percent from a year ago. The rate was pushed upwards by higher prices for food, whose production has been affected by poor weather, and by household services, which includes telephone charges, and for clothing and footwear. Inflation excluding mortgage interest rates and indirect taxes (RPIY) jumped 0.5 percent and 3.1 percent on the year, its highest rate in eight years.

August merchandise trade deficit with countries outside the European Union widened to Stg3.029 billion following Stg2.510 billion shortfall in July. Most of the rise in the deficit was due to a change in the balance on oil and erratic (volatile) items. Higher aircraft imports boosted the balance for erratics. The non-EU balance excluding oil and erratic items widened to a deficit of Stg1.906 billion. The value of exports fell 5.3 percent while the value of imports rose 1.8 percent. Similarly, non-EU export volumes fell 5.1 percent while import volumes increased 1.3 percent. The July whole world deficit fell to Stg2.544 billion from a record Stg3.415 billion in June. The value of exports dropped 2.4 percent while the value of imports fell 6.4 percent. In volume terms, July exports dropped 2.3 percent while import volumes fell 5.5 percent. Excluding oil and erratics, the global trade deficit narrowed less sharply to a record a shortfall of Stg2.718 following Stg3.117 in June.

Asia
Japan - August merchandise trade surplus fell 47.2 percent from the same time last year. Exports were hit by a slump in semiconductor exports and the general global economic slowdown. Last month's surplus was 320.2 billion yen ($2.7billion), the 14th consecutive monthly year-on-year fall. The drop in exports was bigger than in imports, reflecting the worldwide economic slowdown. The trade surplus with the United States was flat with exports falling 5.0 percent and imports down 9.1 percent. The trade surplus with the rest of Asia plunged by 71.9 percent as exports fell 13.8 percent, reflecting the recent strengthening of the yen which makes Japanese goods more expensive overseas.

July tertiary industry index, which tracks service industries, dropped 0.9 percent. The all-industry index, which tallies the production of all goods and services, dropped 1.2 percent.

Americas
Canada - July merchandise trade balance fell to C$5.4 billion. Exports dropped 0.4 percent while imports were virtually unchanged. Import increases in the machinery and equipment sector offset declines in the automotive and energy sectors. Merchandise exports to the United States declined 0.9 percent while imports from south of the border rose 0.3 percent. This resulted in a decline in the trade surplus with the United States to C$8.0 billion.

July manufacturing shipments slipped 0.2 percent. Shipments have been on a downward trend since October 2000. Lower shipments in petroleum and coal products and railroad rolling stock industries were largely offset by higher shipments in beverage and tobacco products and the computer and electronic products industries. Thirteen of 21 industries, representing 58 percent of total shipments, declined. Unfilled orders rose 1.2 percent due to a surge of orders in the aerospace product and parts industry. New orders rose 1.7 percent. This was due to the accumulation of new orders reported by the aerospace product and parts industry. Excluding the impact of this industry, new orders fell 0.7 percent.

August consumer price index remained unchanged from July but rose 2.8 percent when compared with last year. Declines in the fresh vegetables and natural gas categories were mostly offset by higher gasoline and cigarette prices. The increase partly reflects the renewed impact of energy prices, which accounted for about 16 percent of the all items increase. The CPI excluding energy rose 2.6 percent in August compared with August 2000. Seasonally adjusted, August CPI rose 0.2 and 2.9 percent on the year. Core CPI rose 0.1 percent and 2.5 percent when compared with last year.

July seasonally adjusted retail sales fell 0.5 percent because of lower sales at gasoline services stations. Excluding sales by gasoline service stations, retail sales rose 0.3 percent. In constant dollars, retail sales were unchanged and up 3.4 percent when compared with last year.

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