In July, University of Michigan consumer confidence plunged from 70.8 to 64.6, while only a marginal deterioration was expected. The economic outlook sub-index deteriorated from 69.2 to 60.9, while economic conditions fell from 73.2 to 70.4. The worsening in consumer sentiment might be related to the higher than expected job losses in June, but is no real surprise after the decline in both ABC and conference board’s consumer confidence surveys in June.

The f more than expected in May from a revised $28.8B to $26.0B, while markets were looking for a marginal widening. The breakdown shows a 1.6% M/M increase in exports, while imports fell by 0.6% M/M. Excluding petroleum products, the deficit contracted from $13.86B to $12.67B. The unexpected increase in exports was largely due to petroleum related products, while petroleum related imports dropped despite the increasing oil price.


EMU: Both French and Italian IP surprise on the upside

In May, both Italian and French industrial production came out better than expected. In France, industrial production rose by 2.6% M/M, while a small decline was expected, but the previous outcome was slightly downwardly revised. The improvement was largely based on the manufacturing sector, which rose by 2.4% M/M. Italian industrial production came out flat in May, while the consensus was looking for a decline by 1.1% M/M. The April figure was upwardly revised from 1.1% M/M to 1.2% M/M. Together with the much better than expected German figure, this raises expectations that also euro zone industrial production will surprise on the upside of expectations.


Other: UK PPI shows unexpected decline in June

UK output PPI showed an unexpected fall in June. On a monthly basis, output PPI dropped by 0.2% M/M, while an increase by 0.3% M/M was forecasted. Core PPI showed an even bigger surprised falling by 0.8% M/M, while a limited increase was expected. On a yearly basis, core PPI dropped from 1.2% Y/Y to 0.1% Y/Y. This suggests that the underlying inflationary pressures are diminishing rapidly, which should give the Bank of England the room to continue its expansionary monetary policy.