Consider the following:
Australian Leading Index declines:
The Conference Board LEI for Australia fell sharply in April led by a large decline in building approvals (April’s significant drop in the housing indicator was mainly due to a temporary interruption in approval processing), and there were downward revisions to the past few months as actual data for sales to inventories ratio* and gross operating surplus* for the first quarter of 2012 became available. With this month’s decline, the six-month change in the leading economic index remained negative at 2.8 percent (about a -5.5 percent annual rate) between October 2011 and April 2012, significantly down from the increase of 1.0 percent (about a 1.9 percent annual rate) during the previous six months. In addition, the weaknesses among the leading indicators have been somewhat more widespread than the strengths in recent months.The overall trend for this number is now down. As my co-blogger Silver Oz points out, this may be a country specific event; Australia is heavily dependent on China, which is itself slowing down. In addition, Australia is also heavily dependent on natural resources, which are also declining.
EU Markit Manufacturing index shows contraction:
The Markit Eurozone PMI® Composite Output Index was unchanged at 46.0 in June, according to the preliminary ‘flash’ reading which is based on around 85% of usual monthly replies. The index therefore signalled that the private sector economy shrank at a rate unchanged on May – which had seen the steepest contraction since June 2009.Philly Fed Manufacturing Index tanks
With the exception of a marginal increase in January, the survey has recorded continual contraction since last September, with the rate of decline having gathered significant momentum in the second quarter. The second quarter has seen the steepest downturn for three years
Manufacturing firms responding to the Business Outlook Survey indicated weaker business conditions this month. The survey’s diffusion index of current activity fell to -16.6 from a reading of -5.8 in May, its second consecutive negative reading. The survey’s indicators of future activity remained positive and improved slightly.China's manufacturing index dropped into negative territory:
Indicators for new orders, shipments, and average work hours were also negative this month, suggesting overall declines in business. Indexes for current unfilled orders and delivery times both registered negative readings again this month, suggesting lower levels of unfilled orders and faster deliveries
China’s manufacturing may shrink for an eighth month in June, matching the streak during the global financial crisis in a signal the government’s stimulus has yet to reverse the economy’s slowdown.German sentiment is decreasing:
The preliminary reading was 48.1 for a purchasing managers’ index today from HSBC Holdings Plc and Markit Economics. Above-50 readings indicate expansion. The lowest crisis level was 40.9 in November 2008, when industrial production increased 5.4 percent from a year earlier, compared with a gain of 9.6 percent last month.
If confirmed on July 2, the gauge would be at the lowest since November 2011 and equal the run of below-50 readings from August 2008 to March 2009.
The Ifo Business Climate Index for industry and trade in Germany continued to fall in June. Although assessments of the current business situation brightened somewhat after deteriorating significantly last month, companies reported far lower expectations with regard to their six-month business outlook.
The German economy fears the growing impact of the euro crisis. The business climate index in manufacturing dropped further. Manufacturers assess the current
business situation as slightly improved. As far as their six-month business outlook is concerned, however, manufacturers expressed far greater caution than in the past. Their expectations in terms of export business are also much lower and their recruitment plans remain defensive. In retailing the business climate recovered somewhat, after clouding over considerably last month. The retailers surveyed assess their current business situation much more positively and
are also no longer as pessimistic about future business developments as they were last month.
In wholesaling, on the other hand, the business climate indicator fell. Fewer wholesalers described their current business situation as good. Moreover, they are now slightly more sceptical as far as their outlook is concerned.
Simply put, there is nothing good coming out in the economic numbers right now.