(Bloomberg) — Job growth and manufacturing in the U.S. powered ahead at end of the first quarter as a robust pace of coronavirus vaccinations, fewer restrictions on business and fiscal support generate a stronger tailwind for the economy.
Sweden, Norway and Russia are among countries on pace to return to pre-pandemic levels of growth by year-end, while Covid-19 infections continue to haunt emerging economies such as Brazil.
The pandemic may have expedited China’s bid to overcome the U.S. as the world’s largest economy later this decade.
Here are some of the charts that appeared on Bloomberg this week on the latest developments in the global economy:
Employers added the most jobs in seven months with improvement across most industries in March, as more vaccinations and fewer business restrictions supercharged the labor market recovery in the world’s largest economy.
Manufacturing expanded in March at the fastest pace since 1983, catapulted by the firmest orders and production readings in 17 years, adding to evidence of an economy poised to accelerate.
The average time it takes for production materials to reach U.S. factory floors is now the longest on record, the ISM report showed. The purchasing managers group said lead times stretched to 75 days in March from 67 days a month earlier. Shortages of basic materials, higher input prices and difficulties in transporting products are creating headaches for an otherwise robust factory sector.
Russia’s economy continued to rebound from its pandemic-induced recession in the fourth quarter of 2020, easing its contraction as President Vladimir Putin opted against imposing a second national lockdown.
By the end of 2021, Bloomberg Economics forecast output will exceed its pre-pandemic level in Sweden and Norway. That’s set to bring interest rate increases into view.
Home working is likely to remain after the pandemic finishes, according to a survey of 2,000 companies the U.K., most of which are planning to allow employees greater flexibility on where and when they do their jobs.
Since the 1970s, China has been racing to become the world’s largest economy. Its recovery from the pandemic means it could eclipse the U.S. this decade.
Returning to a high growth path will be the easy part for South Asian economies led by India, which confront much harder challenges in the form of increased inequalities and reduced access to education in the wake of the pandemic, according to the World Bank.
Brazil’s unemployment rate rose as another, more contagious wave of the coronavirus began spreading across the nation.
Countries across Asia are trying everything from fertility tours to baby bonuses to spur population growth in an aging world. Not so in Indonesia, where officials are trying to convince people to have fewer children.
Bloomberg Economics’ nowcasts of GDP growth across major economies show output for a significant chunk of the world economy poised to move above the pre-crisis peak, but with a widening divide as China and the U.S accelerate out of the slump, and European countries sink lower.
The International Monetary Fund is preparing to give its member countries the biggest resource injection in its history, $650 billion, to boost global liquidity and help emerging and low-income nations deal with mounting debt and Covid-19.
©2021 Bloomberg L.P.
TSX extends gains as gold prices rise, set to rise for third week
(Reuters) -Canada’s main stock index extended its rise on Friday after hitting a record high a day earlier as gold prices advanced, and was set to gain for a third straight week.
* At 9:40 a.m. ET (13:38 GMT), the Toronto Stock Exchange‘s S&P/TSX composite index was up 24.24 points, or 0.1%, at 19,326.16.
* The Canadian economy is likely to grow at a slower pace in this quarter and the next than previously expected, but tighter lockdown restrictions from another wave of coronavirus were unlikely to derail the economic recovery, a Reuters poll showed.
* The energy sector climbed 0.6% even as U.S. crude prices slipped 0.1% a barrel. Brent crude added 0.1%. [O/R]
* The materials sector, which includes precious and base metals miners and fertilizer companies, added 0.3% as gold futures rose 0.7% to $1,777.9 an ounce. [GOL/] [MET/L]
* The financials sector gained 0.2%. The industrials sector rose 0.1%.
* On the TSX, 117 issues advanced, while 102 issues declined in a 1.15-to-1 ratio favoring gainers, with 14.26 million shares traded.
* The largest percentage gainers on the TSX were Cascades Inc, which jumped 4.2%, and Ballard Power Systems, which rose 2.9%.
* Lghtspeed POS fell 5.6%, the most on the TSX, while the second biggest decliner was goeasy, down 4.9%.
* The most heavily traded shares by volume were Zenabis Global Inc, Bombardier and Royal Bank of Canada.
* The TSX posted 23 new 52-week highs and no new low.
* Across Canadian issues, there were 160 new 52-week highs and 12 new lows, with total volume of 29.68 million shares.
(Reporting by Shashank Nayar in Bengaluru;Editing by Vinay Dwivedi)
Canadian economy likely to slow, but COVID-19 threat to growth low
By Indradip Ghosh and Mumal Rathore
BENGALURU (Reuters) – The Canadian economy is likely to grow at a slower pace this quarter and next than previously expected, but tighter lockdown restrictions from another wave of coronavirus were unlikely to derail the economic recovery, a Reuters poll showed.
Restrictions have been renewed in some provinces as they struggle with a rapid spread of the virus, which has already infected over 1 million people in the country.
After an expected 5.6% growth in the first quarter, the economy was forecast to expand 3.6% this quarter, a sharp downgrade from 6.7% predicted in January.
It was then forecast to grow 6.0% in the third quarter and 5.5% in the fourth, compared with 6.8% and 5.0% forecast previously.
But over three-quarters of economists, or 16 of 21, in response to an additional question said tighter curbs from another COVID-19 wave were unlikely to derail the economic recovery, including one respondent who said “very unlikely”.
“Canada is undergoing a third wave of the virus and while case loads are accelerating, the resiliency the economy has shown in the face of the second wave suggests it can ride out the third wave as well, without considerable economic consequences,” said Sri Thanabalasingam, senior economist at TD Economics.
The April 12-16 poll of 40 economists forecast the commodity-driven economy would grow on average 5.8% this year, the fastest pace of annual expansion in 13 years and the highest prediction since polling began in April 2019.
For next year, the consensus was upgraded to 4.0% from 3.6% growth predicted in January.
What is likely to help is the promise of a fiscal package by Prime Minister Justin Trudeau late last year, which the Canadian government was expected to outline, at least partly, in its first federal budget in two years, on April 19.
When asked what impact that would have, over half, or 11 of 20 economists, said it would boost the economy significantly. Eight respondents said it would have little impact and one said it would have an adverse impact.
“The economic impact of the federal government’s promised C$100 billion fiscal stimulus will depend most importantly on its make up,” said Tony Stillo, director of Canada economics at Oxford Economics.
“A stimulus package that enhances the economy’s potential could provide a material boost to growth without stoking price pressures.”
All but two of 17 economists expected the Bank of Canada to announce a taper to the amount of its weekly bond purchases at its April 21 meeting. The consensus showed interest rates left unchanged at 0.25% until 2023 at least.
“The BoC is set to cut the pace of its asset purchases next week,” noted Stephen Brown, senior Canada economist at Capital Economics.
“While it will also upgrade its GDP forecasts, we expect it to make an offsetting change to its estimate of the economy’s potential, implying the Bank will not materially alter its assessment of when interest rates need to rise.”
(Reporting and polling by Indradip Ghosh and Mumal Rathore; editing by Rahul Karunakar, Larry King)
CANADA STOCKS – TSX rises 0.78% to 19,321.92
* The Toronto Stock Exchange‘s TSX rises 0.78 percent to 19,321.92
* Leading the index were Martinrea International Inc <MRE.TO>, up 7.4%, Fortuna Silver Mines Inc, up 7.1%, and Hudbay Minerals Inc, higher by 6.7%.
* Lagging shares were AcuityAds Holdings Inc, down 6.7%, Ballard Power Systems Inc, down 6.5%, and Northland Power Inc, lower by 6.0%.
* On the TSX 165 issues rose and 60 fell as a 2.8-to-1 ratio favored advancers. There were 18 new highs and no new lows, with total volume of 203.0 million shares.
* The most heavily traded shares by volume were Royal Bank Of Canada, Suncor Energy Inc and Air Canada.
* The TSX’s energy group fell 0.59 points, or 0.5%, while the financials sector climbed 0.86 points, or 0.3%.
* West Texas Intermediate crude futures rose 0.27%, or $0.17, to $63.32 a barrel. Brent crude rose 0.36%, or $0.24, to $66.82 [O/R]
* The TSX is up 10.8% for the year.