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Edward Bell - Senior Director, Market Economics
Daniel Richards - MENA Economist
Jeanne Claire Walters - Senior Economist
Published Date: 08 June 2023
The US trade deficit widened in April, to reach a 6-month high of USD74bn, from USD60.6bn in March. The value of exports fell on the month, declining 5.3% m/m, in part driven by petroleum related exports. In contrast the value of imports rose in March, increasing 2.1% m/m, with increases in motor vehicle and cell phone imports. Net trade is now expected to act as a drag on second quarter GDP growth.
The US Mortgage Bankers Association index of applications for home purchases declined for a fourth consecutive week. The index ended the week of June 2 at a value of 151.7, which amounts to a w/w decline of 1.7%, it’s second-lowest level since 1995. Purchase activity is likely being constrained by not only high lending rates but also a lack of homes for sale.
German industrial production rose 0.3% m/m in April, below consensus expectations of a 0.6% rise. Despite the March figure being revised to -2.1% m/m from an initial reading of -3.4%, production in the Eurozone’s largest economy remains well below pre-pandemic levels.
Japanese Q1 GDP growth was revised up in the final estimate to 2.7% q/q annualized, from a preliminary reading of 1.6%. The growth was driven by a rebuild in inventories, as well as an improvement in corporate investment, while growth in consumer spending was revised slightly lower.
Results from Tuesday’s election in Kuwait saw opposition lawmakers win a majority in the country’s parliament, gaining 29 out of an available 50 seats. The election was the third in as many years, with the September 2022 election results having been annulled in March this year by the constitutional court. The composition of the new parliament remains similar to the one elected last year, suggesting the political stalemate seen in recent years is likely to continue.
The IMF’s concluding statement from their 2023 Article IV mission to Saudi Arabia highlighted the Kingdom’s robust growth in 2022. With 8.7% y/y growth Saudi Arabia was the fastest growing economy in the G20 in 2022. The IMF expect the momentum seen in non-oil growth to continue into 2023, with estimates in excess of 5% for the first half of the year.
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