22ndMarch 2024
Friday
Scheduled forrelease this Friday, key economic indicators from Great Britain, Germany, andCanada are set to be announced, drawing significant attention from investorsand market analysts alike. Great Britain is poised to unveil itsmonth-over-month Retail Sales figures, a critical measure of consumer spendingand economic health. Meanwhile, Germany is expected to announce its IfoBusiness Climate Index, providing insights into the business sentiment withinEurope's largest economy. In addition, Canada will release its Core RetailSales and Retail Sales data on a month-over-month basis, offering a glimpseinto the Canadian consumer behavior and retail performance. These announcementsare highly anticipated as they provide valuable indicators of the economicvitality in each of these major economies.
GBP - Retail Sales m/m
The monthlyreport on changes in inflation-adjusted retail sales, typically releasedapproximately 20 days after the end of each month, serves as the primaryindicator of consumer spending trends. This metric, also known as Sales Volumeor All Retailers Sales, plays a crucial role in assessing the overall economicactivity, with consumer spending being a dominant component.
In January 2024,retail sales volumes experienced a notable rebound of 3.4%, marking the mostsignificant monthly increase since April 2021, following a record decline of3.3% in December 2023 (revised from 3.2%). This resurgence brought volumes backto levels last seen in November 2023. With the exception of clothing stores,sales volumes across all subsectors showed growth, with food stores,particularly supermarkets, contributing significantly to the upturn. Despitethis positive monthly performance, sales volumes recorded a marginal decreaseof 0.2% in the three months leading up to January compared to the precedingthree months, marking the smallest decline since August 2023.
TL;DR
- Retail sales volumes surged by 3.4% in January 2024, the highest monthly rise since April 2021, offsetting December 2023's 3.3% drop.
- Sales in January returned to November 2023 levels, with growth in all sectors except clothing.
- Despite January's rebound, there was a slight 0.2% decrease in sales volumes over the past three months, the smallest dip since August 2023.
The Retail Sales m/m forecast standsat 0.3%, down from the previous figure of 3.4%.
The upcoming Retail Sales m/m isscheduled for release this Friday at 7:00 AM GMT.
The lasttime, British Retail Sales m/m data was announced on the 16thof February, 2024. You may find the market reaction chart (GBPJPY M5) below:
EUR - German ifo Business Climate
The German IfoBusiness Climate Index is a highly regarded monthly gauge of the economicclimate in Germany, derived from a comprehensive survey of around 9,000businesses in sectors such as manufacturing, construction, wholesale, retail,and services. The survey assesses current business conditions and anticipateseconomic activities for the next six months, making it a leading indicator of thecountry's economic health. Changes in the index are closely monitored bytraders and investors as they provide early insights into potential shifts ineconomic activities like spending, hiring, and investment. Notably, the indexhas undergone revisions, including an update to its base year from 2000 to 2005in May 2011, and an expansion to include the services sector in April 2018,enhancing its accuracy and relevance in reflecting the broader economiclandscape.
In February2024, Germany's Ifo Business Climate Index saw a marginal increase, reaching85.5, a slight improvement from the 85.2 recorded in January, which was thelowest in over three years. This figure met the expectations of analysts,indicating a stabilization in the business outlook. Companies expressed asomewhat more positive outlook for the future, with the expectations indexnudging up to 84.1 from 83.5. However, the assessment of the current businessenvironment remained subdued, staying at 86.9, the lowest point since July2020. A closer look at the sectors reveals a mixed sentiment; the servicesector and construction industry experienced a slight uplift in confidence,whereas manufacturers and traders reported a decline in sentiment, reflectingvaried challenges across the economy.
TL;DR
Metric
February 2024
January 2024
Previous Record
Notes
1 Ifo Business Climate Index
85.5
85.2
Lowest in >3 years in Jan
Marginal increase indicating stabilization
2 Expectations Index
84.1
83.5
-
Improved outlook for the future
3 Current Business Environment
86.9
86.9
Lowest since July 2020
Remained subdued
4 Sector Sentiment
Mixed
Mixed
-
Service and construction up, manufacturing and trading down
The latestforecast for the German Ifo Business Climate Index suggests a slightuptick to 86, from the previous reading of 85.5.
The upcoming Germanifo Business Climate is scheduled for release on Friday at 9:00AM GMT.
CAD - Core Retail Sales m/m
Core RetailSales, measured on a monthly basis and released approximately 50 days followingthe end of each month, represent the change in the total value of retail salesexcluding automobile sales. Given that automobile transactions comprise about20% of total retail sales and are subject to significant fluctuations, they canobscure the true trend in consumer spending. As a result, the Core Retail Salesfigure is considered a more reliable indicator of underlying spending patterns,providing valuable insights into consumer behavior and economic health withoutthe distortion caused by the volatile automobile sector.
In December,Canada's Retail Sales excluding automobiles saw a notable rise to 0.6 %,marking a recovery from the -0.4 % dip observed in November 2023. Historicaldata from 1991 to 2023 shows that this segment has averaged a growth rate of0.38 %. The peak of this trend was witnessed in June 2020, with anunprecedented surge to 14.1 %, contrasting sharply with a record decline of-18.8 % in April 2020, highlighting the volatile nature of retail sales in theface of varying economic conditions.
TL;DR
- Canada's Retail Sales excluding automobiles rose to 0.6% in December, recovering from a -0.4% drop in November 2023.
- Historically, this segment has averaged a 0.38% growth rate from 1991 to 2023.
- The peak growth was 14.1% in June 2020, while the lowest was -18.8% in April 2020, highlighting significant volatility.
The Core Retail Sales m/m isindicating a 0% change, compared to the prior result of 0.6%.
CAD - Retail Sales m/m
Retail Sales,reported monthly approximately 50 days after each month concludes, track thechange in the total value of sales at the retail level. This metric is ofparamount importance to traders as it serves as the primary indicator ofconsumer spending, which constitutes the majority of overall economic activity.
In January 2024,preliminary estimates indicated a slight downturn in Canada's retail sector,with sales reportedly decreasing by 0.4% month-over-month. This followed apositive surge in December, where retail sales climbed by 0.9%, a revision froman initial estimate of 0.7%, marking a rebound after a stagnant November. Theboost in December was primarily driven by a notable 1.9% increase in saleswithin the motor vehicle and parts dealers sector, continuing a four-monthupward trend, spearheaded by a 2.4% rise in new car dealer sales. Additionally,gasoline stations and fuel vendors experienced a 0.9% uptick in sales.Conversely, there was a 2.7% decline in sales from automotive parts,accessories, and tire retailers. Excluding these automotive and fuel segments,core retail sales saw a modest 0.5% increase, with significant contributionsfrom general merchandise retailers, which surged by 2.8%, and food and beverageretailers, with a 1.5% rise. The positive momentum in retail sales waspredominantly observed in eight provinces, with Ontario leading at a 1.3%increase, closely followed by British Columbia, which saw a 1.5% rise.
TL;DR
- January 2024 saw a 0.4% month-over-month decrease in Canada's retail sales, following a revised 0.9% increase in December.
- December's growth was led by a 1.9% rise in motor vehicle and parts dealers' sales, including a 2.4% increase in new car sales.
- Gasoline stations and fuel vendors experienced a 0.9% sales increase, while automotive parts, accessories, and tire retailers saw a 2.7% decline.
- Core retail sales (excluding automotive and fuel) increased by 0.5% in December, driven by general merchandise (2.8%) and food and beverage retailers (1.5%).
- Retail sales growth in December was positive in eight provinces, with Ontario and British Columbia seeing rises of 1.3% and 1.5%, respectively.
The forecast for Retail Sales m/m isindicating 0.1% compared to the previous 0.9% outcome.
The upcoming Core Retail Sales m/m & RetailSales m/m data will be published this Friday at 12:30 PM GMT.
