The preliminary figure of second quarter GDP showed no revision in the headline figure compared to the advance estimate. GDP contracted by an annualized 1.0% Q/Q in the second quarter, while a decline by 1.5% Q/Q was expected. The details show upward revisions in personal consumption (-1.0% Q/Q from -1.2% Q/Q) and government consumption (6.4% Q/Q from 5.6% Q/Q), but also the net export deficit narrowed further. Downward revisions came from inventories and business invest-ment.

In the week ended August 22, initial claims dropped by 10 000 from an upwardly revised 580 000 to 570 000, slightly above the consensus estimate of 565 000. Con-tinuing claims, on the contrary, surprised on the downside of expectations in the week ended August 15, falling by 119 000 to a total number of 6 133 000. Both initial and continuing claims are now well off the highs reached a few months ago, but re-main at elevated levels.


EMU: M3 money supply growth slows further

In July, euro zone M3 money supply growth slowed from an upwardly revised 3.6% Y/Y to 3.0% Y/Y, while the consensus was looking for a figure of 3.2% Y/Y. The three-month moving average stayed unchanged at 3.4%, well below the ECB’s ref-erence value of 4.5%. Looking at the lending data, loans to the private sector slowed from 1.5% Y/Y to 0.6% Y/Y. M1 however rose from 9.4% Y/Y to 12.2% Y/Y, which might be a sign that the ECB’s measures are starting to have an impact.

In August, German annual inflation unexpectedly rose back to zero, while the con-sensus was looking for a figure of -0.4% Y/Y. On a monthly basis, CPI inflation rose by 0.4% M/M due to higher prices of clothing, holidays and travelling, while food and energy prices dropped. This outcome raises expectations that also euro zone CPI might come out above expectations in August and suggests the trough in the annual inflation level has been reached in July.


Other: UK retail sales deteriorate, outlook improves

In the UK, the CBI distributive trades report showed a slight deterioration in sales (-16 from -15) in August. Also the volume of orders placed on suppliers dropped (-22 from -13), while the volume of sales for time of the year increased (-25 from -32). For September however, sales are forecasted to improve somewhat. The quarterly sur-vey reported an increase in optimism from -8 to -2, but employment deteriorated (-41 from -29).