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Santa Claus is coming to town – Will the figures shine and sparkle?

Mon, Dec 22 2008, 11:26 GMT
by Benny Menashe

Finotec Group Inc.

As the financial world is embracing the worst economic figures it has seen for decades, it is yet to be seen whether post-Christmas and the New Year’s sales will bring any smiles onto traders’ faces. On Tuesday, the UK’s GDP and current account data will be released allowing investors a closer look at the British economy. According to the preliminary reading of the third GDP, recent dismal manufacturing data, and weak services survey, analysts predict a risk of a downward revision although some do gun for no change. The UK’s current account recorded a deficit of about 11 billion pounds in the second quarter and this deficit is forecast to have widened further in Q3 with the investment income component likely to have taken a hit from a drop in earnings from the country’s overseas assets.

On Tuesday, figures will be published referring to sales of existing and new homes in the US. The mortgage industry efforts to stem foreclosures aims to double the numbers of borrowers getting help next year, as Democrats call for using taxpayers money to address the crisis. Previous date suggested that last month there were 4.98m existing homes sales and 433k new homes compare to the current forecast of 4.90m and 417K accordingly for the current month. These leading indicators of economic health suggest that there is no substantial ripple effect allowing the economy to move forward at a faster pace. However it remains to be seen the steps which will be taken by The Hope Now, a group set up at the behest of US treasury secretary which expects to modify about 2m mortgages next year, as part of the Bush administration main initiative on mortgages.

US unemployment figures will be revealed on Wednesday, being the nation’s earliest economic data ahead of the the New Year. Analysts predicts the level of unemployment will remain at a similar level (550K compare with 554K last week), providing an alarming signal of overall a poor economic health as consumers are reluctant to spend their money and chains such Sharper Image has already closed down and Circuit City is filing for bankruptcy. With such poor figures, it remains to be seen whether Santa will be the next one to visit the Jobs Centre..

Today's Economic Events

Published on  Mon, Dec 22 2008, 11:30 GMT