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August retail sales show slight gain, while September PMI drops:
Davy economist, Aidan Corcoran, comments - - "Mixed signals are to be expected for an economy close to a
turning point in real activity. It was no great surprise therefore
on Friday (October 1st) to see retail sales going one way, with a
1.1% monthly increase in sales volume in August (see our comment
below), and the Markit September manufacturing purchasing managers
index going the other, dropping from 51.1 to 48.4, which is
Short-term indicators will most likely oscillate for some time as
the country emerges from recession. Taxes will rise and, as the IMF
pointed out in its World Economic Outlook for October 2010, this
will negatively impact growth in the short term. The report casts
doubt on the assertion that fiscal contraction can boost growth
through a kind of 'feel-good' effect, where consumers sense that the
country is on a sustainable fiscal path. This is certainly a factor,
but in the short term it is likely to be outweighed by the
withdrawal of resources from the economy through taxes.
The European Commissioner for Economic and Monetary Affairs, Olli
Rehn, said on Friday that Ireland will cease to be a low- tax
economy over the next ten years. A return to normalcy may be no bad
Expectations of US monetary conditions will keep the dollar weak for now, says Ashley Davies, FX strategist at Commerzbank. He shares his currency outlook, with CNBC's Oriel Morrison:
Economic View: Irish data now taking on a higher importance; Goodbody
chief economist, Dermot O’Leary, comments - -"In our note on Friday (Irish
banking costs – Enormous costs, but challenge remains the same), we noted the
increased importance of the incoming economic data given the obvious need for
growth to be part of the solution to Ireland’s fiscal problems. In this regard,
August’s retail sales data on Friday revealed a modest improvement, with core
sales growing by 0.2% in the month, the first monthly increase since March.
Overall retail sales grew by 1.1%, helped by an improvement in car sales in
August. The increases in both measures are modest though and reveal that
consumer spending trends remain weak, in reflection of a still fragile labour
market situation. In fact, core sales, both on a volume and a value basis remain
close to recent lows. From a fiscal point of view, the value of sales gives a
better indication of the performance of underlying VAT trends, for example. In
this regard, the value of sales is at levels last seen at the start of 2005. The
volume of sales is back at levels last seen at the end of 2005. Therefore, it is
not just the level of activity, but the level of prices that matters.
Exchequer returns for September will provide the focus for Ireland when it is
released later today. While October and November are more important tax months
for Ireland (when self-assessed tax returns are collected), these numbers will
go some way to formulating the budget arithmetic ahead of the all-important
four-year budget plans to be released in November. Media speculation this
morning suggests that the figures will be weak, underlying the need for bigger
adjustments for 2011 in particular. While it was clear that the previously
agreed €3bn in savings would not be enough, speculation is now focusing on €4bn
or more in tax changes or spending cuts. This speculation is likely to be a
constant feature in the coming weeks."
Federal minister of the Interior for Germany, Thomas De Maizière, joined CNBC for more on the 20th anniversary of unification in the country:
Aer Lingus: Aer Lingus Group announced Monday the appointment of
Andrew Macfarlane as its CFO and as an executive director with immediate effect.
Macfarlane, 53, has served as Aer Lingus’ interim CFO since December of 2009.
Prior to joining Aer Lingus Macfarlane served as CFO of Rentokil Initial plc and
his career has covered the leisure, business services, real estate and
accounting sectors. His early career was with Ernst & Young, where he spent 12
years, reaching the position of Corporate Finance Partner in 1987.
The MSCI Asia
Pacific Index rose 0.3% Monday.
Nikkei fell 0.25%; China's market was closed; Australia's S&P/ASX 200 Index
gained 1.01% and India's Sensex Index