Analysts at Westpac offered an economic wrap - Westpac

Analysts at Westpac offered an economic wrap.

Key Quotes:

"Another encouraging round of US data was delivered, building on the strong set yesterday. Housing starts fell 2.6% in Jan but all of the fall is attributable to multiples, with single family housing starts rising 1.9%. Building permits gained 4.6% in Jan (vs 0.2% expected).  The Philly Fed survey was very strong at 43.3 (18.0 expected) which was the highest since early 1984. New orders rose 12pts to 38, although employment slipped 1.7pts to 11.1 and prices received fell 16.2pts to 10.6. That said, the headline Philly Fed is consistent with a very strong ISM, and combined with yesterday’s strong Empire survey, hints at a solid run of US PMIs for Feb.

Economic Event Risks Today

Eurozone: Dec current account. The current account surplus posted a record high in Nov of EUR 36.1 bn seasonally adjusted, representing about 3.3% of GDP. Dec was driven by a EUR 30.9 bn surplus on trade in goods. Trade in services also recorded a surplus of EUR 4.8 bn but this was down from EUR 8.9 bn in Nov. Primary income was in surplus of EUR 12.1 bn offset by secondary income in EUR 11.7 bn deficit. The current account has been in surplus in seasonally adjusted terms since mid-2011.

UK: Jan retail sales. Retail sales dropped 1.9% in Dec but rose 4.3%yr over the year with the upwards trend largely intact. The monthly fall was driven by non-food stores. Despite soft consumer confidence, retail sales have held up well, though the market is expecting a flat print for Jan."