The past week has been subject to the decisions on interest rates in different countries. The ECB decided to lower the interest rate, and the central banks of Canada and New Zealand have faced the same decision and this may affect these 2 countries overall economic performance especially the Canadian economy.
The Reserve Bank of New Zealand (RBNZ) unexpectedly cut interest rates to a record low of 2.25%, fueling a descent of the New Zealand dollar.
The RBNZ has explained that the decision to cut rates is linked to low inflation and the worsening of the global economic environment.
The Central Bank of Canada has chosen the easy way out, leaving the rate unchanged at 0.50% despite the difficulties of the domestic economy. GDP is slowing, oil and raw materials prices are falling and they are limiting the economic growth of the country.
In February, the unemployment rate of the Canadian economy represents an increase of 7.3%, against the previous result to 7.2%.
As for the United States, the index of export prices in February, recorded a percentage change of -0.4%, beating expectations placed at -0.5%; while the price index for imports in February has instead reported a change of -0.3%.
Good news however for the Italian industrial production. We could think to a strong recovery in the industry in January, marking a rise of 1.9% compared to the previous month at -0.7%. Since January 2015, the Italian industrial production rose surprisingly of 3.9%.
Even the Italian labor market seems to recover in the fourth quarter of 2015, as stated on the new updated report Istat, with the unemployment rate down from previous surveys. Italy closes 2015 with the unemployment rate declining to 11.5%, from the 11.7% of the previous quarter.
United Kingdom industrial production in January showed an increase of +0.3%, but the expectations wanted a rise of +0.2%.
The monarchical country has had good results also for the Trade Balance in January. The difference between English import and export with the European Union marks a decline of the deficit to 10.29 billion pounds, up from 9.92 billion of the previous month. With the non-EU countries, the deficit fell to 2.20 billion, compared with the result of last December to 2.36 billion.
Germany trade balance in January disappointed instead. The surplus of the German trade balance drops to € 13.6 billion, compared to the result of the previous month to € 20.3 billion.
Exports in January are down of 0.5% while the previous month exports had lost 1.6%. Imports had a strong recovery growing by +1.2%.
Good news from oil prices. They may have finally bottomed out for the last time thanks to the drop in production of non-OPEC countries. This is the last comment of the International International Energy Agency (IEA).
Oil production outside the Organization of Petroleum Exporting Countries (OPEC) will decrease by 750.000 barrels per day in 2016.
It is now time to hope for a rally on oil price even if it seems unlikely to occur by mid-2016.