January 21, 2021

U.S. Plods Ahead, Europe Stagnates

(Bloomberg) — The U.S. housing market is powering ahead while lean business inventories are creating an updraft for shippers and manufacturing — consistent with projections for a third-quarter snapback in economic growth.

The path of the coronavirus, nonetheless, remains a risk to the world’s largest economy, evidenced by the recent struggle with the disease’s resurgence in Europe. Some governments there have reinstated restrictions and that’s caused the recovery to stagnate.

Here are some of the charts that appeared on Bloomberg this week, offering insight into the latest developments in the global economy:

World



a screenshot of a cell phone: Pandemic Fallout


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Pandemic Fallout

The damage to labor markets from the coronavirus is proving worse than anticipated, according to the International Labour Organization, which also sees a much slower recovery at the end of this year.

U.S.



a screenshot of a cell phone: U.S. new-home sales surprise in August, rise to fresh 14-year high


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U.S. new-home sales surprise in August, rise to fresh 14-year high

Sales of new homes unexpectedly advanced for a fourth month in August to the highest level in almost 14 years as record-low mortgage rates continued to entice buyers into a market with ever-shrinking supply.



a screenshot of a cell phone: Nation's biggest port has been extremely busy after end of U.S. virus restrictions


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Nation’s biggest port has been extremely busy after end of U.S. virus restrictions

America’s network for moving goods into and around the country is the busiest in years after being throttled by the pandemic. Ports are seeing a flood of container imports while railroads and trucks rush those goods to distribution points. The surge in activity has its roots in the shutdown of the economy that left businesses reliant on inventories, which are now extremely lean as demand accelerates.



chart, histogram: Cost of U.S. Stimulus Gridlock


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Cost of U.S. Stimulus Gridlock

After four rounds of U.S. aid totaling nearly $3 trillion, fiscal stimulus is running out: Bloomberg Economics’ analysis shows that under a no-stimulus baseline scenario through year-end, total income flowing to households will transition from unprecedentedly strong for a recession, to just so-so.

Europe



a screenshot of a cell phone: Lockdown 2.0


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Lockdown 2.0

The U.K. government’s new restrictions are likely to have a modest impact on gross domestic product, but add in concerns generated by the rising risk of infection, and Bloomberg Economics now thinks the slowdown over the next six months will be more marked than previously anticipated.



The euro-area’s economic recovery stalled this month


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The euro-area’s economic recovery stalled this month

The euro area’s economic recovery stalled this month as consumers fretted about a resurgence of the virus and governments reinstated restrictions to control the spread of the disease.

Asia



a screenshot of a cell phone: National treasury has record amount of government funds


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National treasury has record amount of government funds

China’s government has amassed trillions of yuan in unspent money, handing it fiscal firepower to stimulate an economic recovery that’s already leading the world’s rebound from the Covid-19 shock.



a screenshot of a video game: Gaining Traction


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Gaining Traction

India’s economy showed signs of stabilizing in August with manufacturing and services gradually improving even as coronavirus cases escalated across the country.

Emerging Markets



a screenshot of a video game: Turkey increases interest rates for the first time since 2018


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Turkey increases interest rates for the first time since 2018

Turkey’s central bank raised interest rates for the first time since a currency crisis in late 2018, surprising most economists after a series of backdoor measures fell short of stabilizing the lira.



chart, histogram: Fearful Money


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Fearful Money

Argentines, scarred from decades of economic booms and busts, are beginning to withdraw dollar deposits held at local banks after the latest round of measures to tighten capital controls.

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