US Factory Orders Rebound

According to Markit’s results for the Services Purchasing Manager’s Index, the services sector in the Euro Area reportedly expanded by 53.3 in February, outperforming the previous month’s results and expectations of 53.0. Gains were attributed to major core economies within the Eurozone with Germany climbing to 55.3 from the prior month’s value of 55.1 and Italy increasing to 53.8 from previous 53.6. Spain released a value of 54.1 which was higher than expectations of 54.0 but declined from January’s value of 54.6. However, the one weak spot continued to be the French economy which experienced a contraction after printing below the 50 mark level at 49.2, missing expectations of 49.8. The stronger data may in part reflect growing confidence that the European Central Bank is set to act in the upcoming monetary policy decision due on March 10^th.

Retail sales figures in Australia, considered a leading indicator for consumer spending and key driver of economic growth at a challenging time for the economy climbed during the month of January. The Australian Bureau of Statistics reported an increase of 0.30% for the post-Christmas month, climbing back from a flat value of 0.00% during the previous month, but missing expectations of a 0.40% increase. Housing prices kept sales afloat as accommodative policies implemented by the Reserve Bank of Australia keep household credit at low levels. Household goods was the strongest factor behind the rise, ascending by 1.00% although the positivity was offset by department store sales declining by -1.30%. A strong labor market over the past year has raised consumer confidence but the slowdown in the Chinese economy, Australia’s largest trading partner, has economists worried that near-term positivity may reverse, reflecting weakness in global trade.