International Economic Trends

InternationalEconomicTrends November 2009

International Trade Integration and Business Cycle Synchronization

T

19

74 19 76 19 78 19 80 19 82 19 84 19 86 19 88 19 90 19 92 19 94 19 96 19 98 20 00 20 02 20 04 20 06

rade and international capital flows have grown rapidly in recent years. The sum of U.S. exports to the rest of the Real Output and Real Consumption Correlations world (ROW) plus imports from the ROW, as a percentPeriod YUS ,YROW CUS ,CROW age of gross domestic product (GDP), increased by 50 percent from 1974 to 2007.1 Cross-country financial holdings also 1974-2007 0.52 0.33 increased substantially during this period. U.S. international 1974-1985 0.71 0.37 portfolio investments increased from 2 percent to 29 percent of 1986-2007 0.26 0.27 U.S. capital stock from 1974 to 2007; foreign asset holdings in NOTE: The table shows the correlations calculated on the United States similarly increased. filtered quarterly series taken from the Organisation for Although trade has grown and investors have diversified Economic Co-operation and Development. The series are expressed at 2000 national currency constant prices their international asset holdings, U.S. output and consumption and converted into U.S. dollars using 2000 purchasing commove less with those in the ROW. In particular, the correpower parity exchange rates. lation between U.S. real output and that of the ROW sharply declined, while the correlation between U.S. real consumption and that of the ROW declined much more modestly. The U.S.-ROW GDP correlation declined from 0.71 U.S. Assets, Liabilities, and Trade to 0.26 between 1974 and 1985 and 1986 and 2007, while the U.S.-ROW consumption correlation declined Percent of U.S. Capital Stock Percent of U.S. GDP from 0.37 to 0.27 across the same periods (see the 35 15 Foreign-Held U.S. Assets table).2 U.S.-Held Foreign Assets 30 14 The changes in international trade and finance are U.S. Gross Trade (imports + exports) 3 linked to the changes in business cycle correlations. 25 13 Because trade integration tends to increase specializa20 12 tion in production, it may reduce output correlation across countries when asymmetric industry-specific 15 11 shocks occur. For example, a positive shock to produc10 10 tion in the auto industry will increase production in carproducing countries but reduce it in others. On the other 5 9 hand, greater international asset diversification increases 0 8 the ability of countries to share risks, thereby insuring each other against declines in consumption (see the chart). For example, when the U.S. stock market NOTE: Asset holdings are measured on the left axis, and gross trade is measured on declines, U.S. consumers can offset some of their losses the right axis. SOURCE: Bureau of Economic Analysis and International Monetary Fund. with asset holdings in other countries. As a consequence, people can continue to consume at nearly normal rates, even during a recession. Thus, consumption correlations may decrease by less than output correlations or even increase. —Luciana Juvenal 1

The ROW series are an aggregate of Canada, Japan, and Europe. Europe includes the following 15 countries: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Norway, the Netherlands, Portugal, Spain, Sweden, and the United Kingdom.

2 The selection of 1985 as a breakpoint is related to the moderation of the U.S. business cycle. 3 Juvenal, Luciana and Santos Monteiro, Paulo. “Trade Integration and Financial Globalization.” Unpublished manuscript, Federal Reserve Bank of St. Louis, 2009.

Views expressed do not necessarily reflect official positions of the Federal Reserve System.

research.stlouisfed.org

Contents Page 3

Reference Tables

5

Canada

11

Euro Area

16

France

20

Germany

24

Italy

28

Japan

34

United Kingdom

40

United States

46

Notes and Sources

Conventions used in this publication: 1. Charts and tables contain data that were current through October 2009. Unless otherwise indicated, data are quarterly. 2. The percent change refers to the percent change from the same period in the previous year. For example, the percent change in x between quarter t – 4 and the current quarter t is: [(xt /x t – 4)–1] ×100. 3. All data with significant seasonal patterns are adjusted accordingly.

Due to a new earnings statistics law, hourly earnings data published by the German National Statistical Office now incorporate wage and salary employees. Data prior to 2007 are not strictly comparable with the new figures.

We welcome your comments addressed to: Editor, International Economic Trends Research Division Federal Reserve Bank of St. Louis P.O. Box 442 St. Louis, MO 63166-0442

Slovakia joined the euro area on January 1, 2009. The Notes section details the Slovakian data.

or to: [email protected]

International Economic Trends is published by the Research Division of the Federal Reserve Bank of St. Louis; the annual edition is published in July. Visit the Research Division’s website at research.stlouisfed.org/publications/iet to download the quarterly issue of this publication or register for e-mail notification updates. For more information on data in this publication, please call (314) 444-8590.

International Economic Trends

Reference Tables Real Gross Domestic Product Percent change from year ago Canada Euro Area France Germany Italy Japan United Kingdom United States

06.3 2.42 3.09 2.30 3.51 1.92 1.70 2.66 2.23

06.4 1.91 3.48 2.41 4.31 2.56 2.08 2.80 2.45

07.1 1.82 3.43 2.55 3.77 2.22 3.21 2.42 1.42

07.2 2.57 2.68 1.87 2.58 1.89 2.26 2.70 1.86

07.3 2.97 2.69 2.47 2.47 1.57 1.82 2.71 2.74

07.4 2.76 2.18

08.1 1.66 2.18

08.2 0.70 1.46

08.3 0.28 0.44

08.4 -0.95 -1.75

09.1 -2.31 -4.94

09.2 -3.23 -4.78

2.16 1.58 0.31 1.86 2.41

1.87 2.86 0.31 1.41

0.12 0.83 -1.24

2.53

-0.33 0.34 0.03

-1.70 -1.75 -3.11 -4.49 -1.97 -1.86

-3.50 -6.72 -5.88 -8.40 -4.99 -3.30

-2.81 -5.90 -6.21 -7.22

2.30 2.04

1.00 1.96 -0.31 0.66 1.57 1.60

-5.48 -3.83

Nominal Gross Domestic Product Percent change from year ago Canada Euro Area France Germany Italy Japan United Kingdom United States

06.3 4.90 5.15 4.88 3.98 3.90 0.80 6.71 5.58

06.4 3.10 5.40 4.92 5.09 3.57 1.59 5.96 5.39

07.1 4.46 5.86 5.16 5.57 4.66 2.77 5.52 4.64

07.2 6.09 5.16 4.53 4.53 3.49 1.97 6.10 4.87

07.3 5.77 5.20 5.11 4.61 4.02 1.03 5.39 5.40

07.4 6.56 4.61

08.1 5.33 4.34

08.2 5.74 3.83

08.3 5.97 2.78

08.4 0.77 0.69

09.1 -3.80 -3.11

09.2 -6.67 -3.74

4.45 3.58 3.18 0.63 5.03 5.34

4.33 4.21 2.62 0.31 5.23 4.19

3.50 3.40 3.12 -0.77 4.31 3.58

2.58 2.25 1.55 -1.95 2.84 2.59

0.81 0.15 0.00 -3.89 0.85 0.07

-1.64 -5.27 -2.55 -7.38 -3.87 -1.36

-1.54 -4.63 . -6.16 -4.13 -2.39

06.4 1.39 1.80 1.53 1.30 1.97 0.31 2.72 1.95

07.1 1.88 1.92 1.32 1.91 2.05 -0.07 2.88 2.44

07.2 2.13 1.87 1.24 1.96 1.84 -0.05 2.56 2.64

07.3 2.10 1.87 1.33 2.17 1.68 -0.16 1.76 2.32

07.4 2.44 2.89 2.54 3.07 2.59 0.51 2.10 4.04

08.1 1.82 3.37 3.32 3.08 3.28 1.00 2.40 4.20

08.2 2.32 3.63

08.3 3.42 3.84

08.4 1.92 2.31

09.1 1.26 0.96

09.2 0.02 0.16

3.68 3.02 3.77 1.37 3.36 4.27

3.63 3.26 4.06 2.15 4.81 5.23

2.03 1.68 2.91 1.02 3.88 1.53

0.70 0.78 1.35 -0.12 3.02 -0.18

-0.25 0.25 0.86 -0.98 2.11

06.4 1.91 1.71 1.29 0.88 1.57 0.69 0.36 2.10

07.1 2.47 1.80 1.89 1.78 0.71 0.43 0.33 1.85

07.2 2.00 1.73 1.71 1.66 0.53 0.91 0.44 1.25

07.3 2.30 1.88 1.68 1.57 1.53 0.30 0.89 0.97

07.4 2.45 1.70

08.1 2.07 1.54

08.2 1.91 1.13

08.3 1.35 0.46

08.4 0.79 -0.11

09.1 -1.09 -1.26

09.2 -1.67 -1.78

1.83 1.66 1.05 0.24 0.70 0.45

1.40 1.62 0.84 0.10 0.87 0.04

0.88 1.49 0.30 -0.41 0.67 0.08

0.21 1.38 -0.63 -0.61 -0.08 -0.46

-0.88 1.08 -0.95 -0.76 -1.16 -1.52

-2.19 0.42 -1.92 -0.76 -1.92 -3.12

-2.50 -0.07 -2.64 -2.06 -2.57 -3.70

06.4 6.17 8.00 8.97 9.23 6.50 4.03 5.47 4.43

07.1 6.13 7.70 8.77 8.77 6.00 4.00 5.50 4.50

07.2 6.03 7.50 8.47 8.47 5.90 3.80 5.30 4.53

07.3 5.97 7.47 8.20 8.27 6.20 3.80 5.27 4.70

07.4 5.90 7.33

08.1 5.93 7.23

08.2 6.10 7.37

08.3 6.17 7.60

08.4 6.43 8.03

09.1 7.63 8.77

09.2 8.33 9.30

7.90 8.00 6.40 3.83 5.13 4.80

7.63 7.60 6.60 3.83 5.13 4.93

7.63 7.37 6.80 4.03 5.27 5.37

7.87 7.17

8.27 7.10 6.90 4.03 6.33 6.87

8.90 7.30 7.40 4.43 7.07 8.07

9.37 7.63 7.40 5.20 7.67 9.27

Consumer Price Index Percent change from year ago Canada Euro Area France Germany Italy Japan United Kingdom United States

06.3 1.70 2.16 1.90 1.61 2.32 0.58 2.40 3.34

-0.94

Employment Percent change from year ago Canada Euro Area France Germany Italy Japan United Kingdom United States

06.3 1.91 1.65 1.30 0.82 1.76 0.19 0.28 1.60

Unemployment Rate Percent Canada* Euro Area* France* Germany* Italy* Japan* United Kingdom* United States*

06.3 6.43 8.17 9.17 9.60 6.60 4.10 5.47 4.63

6.80 4.03 5.83 6.07

* Copyright , 2009, Organisation for Economic Cooperation and Development, OECD Main Economic Indicators (www.oecd.org).

Research Division Federal Reserve Bank of St. Louis

3

International Economic Trends

Reference Tables

Reserve Money Percent change from year ago Canada Japan United Kingdom United States

06.3

06.4

07.1

07.2

07.3

07.4

08.1

08.2

08.3

08.4

09.1

09.2

5.79 -21.27

5.94 -20.11 5.31 2.71

5.66 -18.88 4.06 1.90

5.43 -4.25 4.31 1.62

5.63 0.65 4.89 2.11

4.89 0.14 5.56 1.81

2.88 0.17 6.44 1.18

3.64 0.29 6.05 1.12

2.42

5.45 1.68 6.73 67.58

7.45 7.00 8.14 94.22

12.93 6.26 8.65 105.23

06.3

06.4

07.1

07.2

07.3

07.4

08.1

08.2

08.3

08.4

09.1

09.2

9.19 7.51 1.65 7.89 4.31

9.84 7.63 0.08 7.99 5.11

9.48 7.28 -0.10 7.53 5.82

9.34 6.50 -0.26 7.25 7.68

10.27 6.55 -0.30 7.39 10.10

7.18 4.11

7.42

7.98 1.61 -0.45 6.43 16.06

7.86 1.67 -0.44 5.39 13.47

12.41

12.63 7.12

12.62 10.16 0.43 3.61 10.25

06.3

06.4

07.1

07.2

07.3

07.4

08.1

08.2

08.3

08.4

09.1

09.2

8.15 8.72 0.53 14.44

8.91 9.33 0.69 12.74

7.36 10.97 2.23 11.52 6.52

8.49 10.48 2.16 11.39 6.48

8.45 9.97 2.19 12.02 6.10

12.35 8.57 1.81 16.62 8.32

14.21

12.92 6.09

6.44 11.89 2.08 11.84 5.87

14.30 5.90 2.22

5.23

7.93 11.15 1.75 13.01 5.83

8.17 11.11 1.74

4.92

8.44 10.88 1.07 12.94 5.26

17.80 9.42

12.19 8.64

5.24 3.16

0.85 5.40 4.76

Narrow Money Percent change from year ago Canada Euro Area Japan United Kingdom United States

0.51 6.69 12.48

2.89 -0.30 6.66 15.02

3.73 -1.04 4.58 11.58

-0.01 4.16 12.16

Broad Money Percent change from year ago Canada Euro Area Japan United Kingdom United States

4.13 2.47

Short-Term Interest Rates Percent Canada* Euro Area Japan* United Kingdom* United States

06.3

06.4

07.1

07.2

07.3

07.4

08.1

08.2

08.3

08.4

09.1

09.2

4.32 3.22 0.38 4.85 5.39

4.32 3.59 0.42 5.17 5.32

4.35 3.82 0.54 5.49 5.31

4.52 4.07 0.60 5.72 5.32

5.11 4.50 0.73 6.30 5.42

4.79 4.73 0.76 6.31 5.02

3.57 4.48 0.75 5.69 3.23

3.16 4.86 0.71 5.86 2.76

3.29 4.98 0.74 5.81 3.06

2.32 4.21

1.06 2.01 0.56 2.06 1.08

0.57 1.31 0.34 1.33 0.62

0.78 4.60 2.82

* Copyright , 2009, Organisation for Economic Cooperation and Development, OECD Main Economic Indicators (www.oecd.org).

Long-Term Interest Rates Percent Canada* Euro Area France* Germany* Italy* Japan United Kingdom* United States

06.3

06.4

07.1

07.2

07.3

07.4

08.1

08.2

08.3

08.4

09.1

09.2

4.27

4.02 3.83 3.79 3.76 4.03 1.71

4.08 4.08 4.06 4.00 4.24

4.36 4.41

4.48 4.46 4.44

4.17

3.75 4.12

3.66 4.50 4.47

3.62 4.55 4.48 4.26 4.90 1.52 4.78 4.38

3.38 4.04 3.90 3.50 4.66 1.43 4.15 3.90

2.89 3.87 3.64 3.07 4.54 1.28 3.54 3.55

3.20 3.94 3.79 3.32 4.46 1.45 3.58 4.05

3.96 3.90 3.88 4.17 1.80 4.62 5.06

4.60 4.80

1.68 4.86 4.86

4.39 4.33 4.54 1.75 5.21 5.03

4.34 4.64 1.73 5.18 4.98

4.34 4.33 4.19 4.53 1.57 4.79 4.59

4.08 3.93 4.38 1.40 4.52 4.25

4.25 4.78 1.62 4.91 4.46

* Copyright , 2009, Organisation for Economic Cooperation and Development, OECD Main Economic Indicators (www.oecd.org).

Research Division

4

Federal Reserve Bank of St. Louis

International Economic Trends

Canada Real GDP

Employment

Percent change from year ago

Percent change from year ago 3

4

2 2 1 0 0 -2 -1

-4

-2 05

2005

06

2006

07

2007

08

2008

09

2009

10

Consumer Price Index

05

2005

06

2006

07

2007

08

2008

09

2009

10

Unemployment Rate

Percent change from year ago

Percent 8.5

4

8.0 3 7.5

7.0

2

6.5 1 6.0

0

5.5 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

Real Hourly Earnings

Current Account Balance

Percent change from year ago

Percent of GDP

8

08

2008

09

2009

10

4

6 2

4 2

0 0 -2

-2

-4 -6

-4 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division Federal Reserve Bank of St. Louis

5

International Economic Trends

Canada

Reserve Money

Interest Rates

Percent change from year ago

Percent

15

6

10-Year Government Bonds 5

12

| | |

4 9 3 6 2 3

1

90-Day Prime Corporate Paper 0

0 05

2005

06

2006

07

2007

08

2008

09

2009

10

M1B

05

2005

06

2006

07

2007

08

2008

09

2009

10

Exchange Rate and Inflation Differential

Percent change from year ago

C$/US$

Percent 7.58

1.33

15

Foreign/US Inflation Differential (right scale)

12 1.23

0.00

1.13

-7.58

9

6

Exchange Rate (left scale)

1.03

-15.16

3

0

0.93 05

2005

06

2006

07

2007

08

2008

09

2009

-22.74

2005

10

M2

2006

2007

2008

2009

Real Effective Exchange Rate

Percent change from year ago

Index 2005 = 100 130

15

12 120 9 110 6 100 3

0

90 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division

6

Federal Reserve Bank of St. Louis

International Economic Trends

Canada GDP Percent change from year ago 12

Nominal 8 4 0

Real -4 -8 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Industrial Production Percent change from year ago 15 10 5 0 -5 -10 -15 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Retail Sales Percent change from year ago 20 15 10 5 0 -5 -10 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Capacity Utilization Percent 90 85 80 75 70 65 60 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

7

International Economic Trends

Canada

Real Hourly Earnings and Output per Worker Percent change from year ago 9

Hourly Earnings 6 3 0

Output per Worker -3 -6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Labor Force Indicators Percent change from year ago

Percent

6

14

Employment (left scale) 3

11

0

8

Unemployment Rate (right scale) -3

5 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Inflation Percent change from year ago 12

Producer Price Index 8

4

0

| Consumer Price Index

-4 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Gross Government Debt and Budget Balance Percent of GDP, annual data

Percent of GDP, annual data

4

102

0

92

82

-4

Gross Debt (right scale) -8

72

Budget Balance (left scale) 62

-12 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Research Division

8

Federal Reserve Bank of St. Louis

International Economic Trends

Canada International Trade - Goods and Services Percent of GDP 50

Exports 40

Imports 30

20 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Current Account Balance Percent of GDP 6

3

0

-3

-6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Foreign Exchange Reserves Billions of US$ 50 40 30 20 10 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Real Effective Exchange Rate Index 2005 = 100 125 115 105 95 85 75 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

9

International Economic Trends

Canada

Reserve Money Percent change from year ago 30

20

10

0

-10 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Monetary Aggregates Percent change from year ago 20

M1B 15 10 5 0

M2 -5 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Interest Rates Percent 15

10-Year Government Bonds 10

5

90-Day Prime Corporate Paper 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Stock Exchange Index - Toronto Stock Exchange 2005 = 100 150

120

90

60

30 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division

10

Federal Reserve Bank of St. Louis

International Economic Trends

Euro Area Real GDP

Employment

Percent change from year ago

Percent change from year ago 2

4

2 1 0 0 -2 -1 -4

-6

-2 05

2005

06

2006

07

2007

08

2008

09

2009

10

Consumer Price Index

05

2005

06

2006

07

2007

08

2008

09

2009

10

Unemployment Rate

Percent change from year ago

Percent 9.5

4

9.0 3 8.5 2 8.0 1 7.5

0

7.0 05

2005

06

2006

07

2007

08

2008

09

2009

10

Real Hourly Earnings

05

2005

06

2006

07

2007

08

2008

09

2009

10

Current Account Balance

Percent change from year ago

Percent of GDP 1.0

5

0.5

4

0.0 3 -0.5 2 -1.0 1

-1.5

0

-2.0 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division Federal Reserve Bank of St. Louis

11

International Economic Trends

Euro Area

M1

Interest Rates

Percent change from year ago

Percent 6

18

15

Weighted Average of 10-Year Government Bonds

5

| |

12 4 9 3 6

90-Day Deposits 2

3

0

1 05

2005

06

2006

07

2007

08

2008

09

2009

10

M3

05

2005

2006

06

07

2007

08

2008

09

2009

10

Exchange Rate and Inflation Differential

Percent change from year ago

Euro/US$

Percent

0.86

12

13.16

Exchange Rate (left scale) 10

0.81

8

0.76

6.58

0.00

| 6

0.71

4

0.66

Foreign/US Inflation Differential (right scale)

-6.58

-13.16

0.61

2 05

2005

06

2006

07

2007

08

2008

09

2009

Stock Exchange Index - Dow Jones EURO STOXX

-19.76

2005

10

2006

2007

2008

2009

Real Effective Exchange Rate

SM

2005 = 100

Index 2005 = 100 115

150

130 110 110 105 90 100 70

50

95 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division

12

Federal Reserve Bank of St. Louis

International Economic Trends

Euro Area GDP Percent change from year ago 9 6

Nominal

3 0

Real -3 -6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Industrial Production Percent change from year ago 10 5 0 -5 -10 -15 -20 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Retail Sales Percent change from year ago 6.0 4.5 3.0 1.5 0.0 -1.5 -3.0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Capacity Utilization Percent 90

85

80

75

70 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

13

International Economic Trends

Euro Area

Real Hourly Earnings and Output per Worker Percent change from year ago 8 6

Hourly Earnings 4 2 0

Output per Worker

-2 -4 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Labor Force Indicators Percent change from year ago

Percent

3

12

Employment (left scale)

2

11

1

10

0

9

-1

8

Unemployment Rate (right scale)

-2 92

93

94

95

96

97

98

99

00

7 01

02

03

04

05

06

07

08

09

Inflation Percent change from year ago 9

Producer Price Index 6

Consumer Price Index

| |

3 0 -3 -6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Gross Government Debt and Budget Balance Percent of GDP, annual data 2

Percent of GDP, annual data 80

Gross Debt (right scale)

0

70

-2

60

50

-4

Budget Balance (left scale) -6

40 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Research Division

14

Federal Reserve Bank of St. Louis

International Economic Trends

Euro Area International Trade - Goods Percent of GDP 20 18 16 14

Exports 12

Imports 10 8 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Real Effective Exchange Rate Index 2005 = 100 120

110

100

90

80 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Monetary Aggregates Percent change from year ago 20

15

M1 10

5

M3 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Interest Rates Percent 12

9

Weighted Average of 10-Year Government Bonds 6

90-Day Deposits 3

0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

15

International Economic Trends

France

Real GDP

Employment

Percent change from year ago

Percent change from year ago

4

2

1 2 0 0 -1 -2 -2

-3

-4 05

2005

06

2006

07

2007

08

2008

09

2009

10

Consumer Price Index

05

2005

06

2006

07

2007

08

2008

09

2009

10

Unemployment Rate

Percent change from year ago

Percent

4

10.0

3

9.5

2

9.0

1

8.5

0

8.0

7.5

-1 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

Real Hourly Earnings

Current Account Balance

Percent change from year ago

Percent of GDP

4

08

2008

09

2009

10

2

1 3 0

-1 2 -2

-3

1 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division

16

Federal Reserve Bank of St. Louis

International Economic Trends

France GDP Percent change from year ago 9 6

Nominal 3 0

Real -3 -6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Industrial Production Percent change from year ago 10 5 0 -5 -10 -15 -20 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Retail Sales Percent change from year ago 6 4 2 0 -2 -4 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Capacity Utilization Percent 90

85

80

75

70 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

17

International Economic Trends

France

Real Hourly Earnings and Output per Worker Percent change from year ago 6

Hourly Earnings 4

2

0

Output per Worker -2 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Labor Force Indicators Percent change from year ago

Percent

4

14

2

12

0

10

8

-2

Employment (left scale)

Unemployment Rate (right scale) 6

-4 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Inflation Percent change from year ago 8

Producer Price Index

Consumer Price Index

4

0

-4

-8 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Gross Government Debt and Budget Balance Percent of GDP, annual data

Percent of GDP, annual data

2

85

0

75

-2

65

Gross Debt (right scale)

-4

55

Budget Balance (left scale)

-6

45

-8

35 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Research Division

18

Federal Reserve Bank of St. Louis

International Economic Trends

France International Trade - Goods and Services Percent of GDP 35

30

Exports 25

Imports 20

15 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Current Account Balance Percent of GDP 4

2

0

-2

-4 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Foreign Exchange Reserves Billions of US$ 50

40

30

20

10 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Stock Exchange Index - SBF 250 2005 = 100 150 125 100 75 50 25 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

19

International Economic Trends

Germany

Real GDP

Employment

Percent change from year ago

Percent change from year ago 2.0

6 4

1.5

2 1.0 0 0.5 -2 0.0 -4 -0.5

-6 -8

-1.0 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

Consumer Price Index

Unemployment Rate

Percent change from year ago

Percent

4

11

3

10

2

9

1

8

0

2007

08

2008

09

2009

10

7 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

Real Hourly Earnings

Current Account Balance

Percent change from year ago

Percent of GDP

4

9

3

6

2

3

1

0

0

08

2008

09

2009

10

-3 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

* Please see the important note on the table of contents page. Research Division

20

Federal Reserve Bank of St. Louis

International Economic Trends

Germany GDP Percent change from year ago 12 8

Nominal

4 0 -4

Real -8 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Industrial Production Percent change from year ago 10 5 0 -5 -10 -15 -20 -25 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Retail Sales Percent change from year ago 4 2 0 -2 -4 -6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Capacity Utilization Percent 90

85

80

75

70 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

21

International Economic Trends

Germany

Real Hourly Earnings and Output per Worker Percent change from year ago 9 6

Hourly Earnings* 3 0

Output per Worker -3 -6 -9 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

* Please see the important note on the table of contents page.

Labor Force Indicators Percent change from year ago

Percent

4

11

Unemployment Rate (right scale) 9

2

0

7

Employment (left scale)

-2

5

3

-4 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Inflation Percent change from year ago 9 6

Consumer Price Index 3

| |

0

Producer Price Index -3 -6 94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Gross Government Debt and Budget Balance Percent of GDP, annual data

Percent of GDP, annual data 80

4 2 0

Gross Debt (right scale)

70

Budget Balance (left scale)

60

-2

50

-4

40

-6

30 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

The actual value for budget balance in 2008 is 0.0%. Research Division

22

Federal Reserve Bank of St. Louis

International Economic Trends

Germany International Trade - Goods and Services Percent of GDP 50 45

Exports 40 35 30

Imports 25 20 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Current Account Balance Percent of GDP 10

5

0

-5 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Foreign Exchange Reserves Billions of US$ 125

100

75

50

25 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Stock Exchange Index - CDAX 2005 = 100 180 150 120 90 60 30 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

23

International Economic Trends

Italy

Real GDP

Employment

Percent change from year ago

Percent change from year ago

4

3

2

2

0

1

-2

0

-4

-1

-6

-2

-8

-3 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

Consumer Price Index

Unemployment Rate

Percent change from year ago

Percent

2007

08

2008

09

2009

10

9

5

4 8 3 7 2 6 1

0

5 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

Real Hourly Earnings

Current Account Balance

Percent change from year ago

Percent of GDP

5

08

2008

09

2009

10

1

0 4 -1

3

-2

-3 2 -4

-5

1 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division

24

Federal Reserve Bank of St. Louis

International Economic Trends

Italy GDP Percent change from year ago 10

Nominal 5

0

Real -5

-10 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Industrial Production Percent change from year ago 10 5 0 -5 -10 -15 -20 -25 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Retail Sales Percent change from year ago 6 3 0 -3 -6 -9 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Capacity Utilization Percent 84 80 76 72 68 64 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

25

International Economic Trends

Italy

Real Hourly Earnings and Output per Worker Percent change from year ago 12 8

Hourly Earnings 4 0

Output per Worker -4 -8 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Labor Force Indicators Percent change from year ago

Percent

4

14

2

12

0

10 8

-2

Employment (left scale)

-4

Unemployment Rate (right scale)

6

-6

4 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Inflation Percent change from year ago 8

Producer Price Index 4

Consumer Price Index 0

-4

-8 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Gross Government Debt and Budget Balance Percent of GDP, annual data

Percent of GDP, annual data

0

140

120

-4

Gross Debt (right scale) -8

100

Budget Balance (left scale) 80

-12 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Research Division

26

Federal Reserve Bank of St. Louis

International Economic Trends

Italy International Trade - Goods and Services Percent of GDP 35

30

Exports 25

Imports 20

15 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Current Account Balance Percent of GDP 4 2 0 -2 -4 -6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Foreign Exchange Reserves Billions of US$ 80

60

40

20

0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Stock Exchange Index - Milan Stock Exchange 2005 = 100 150 125 100 75 50 25 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

27

International Economic Trends

Japan

Real GDP

Employment

Percent change from year ago

Percent change from year ago

4

1

2 0

0 -2

-1 -4 -6

-2

-8 -10

-3 05

2005

06

2006

07

2007

08

2008

09

2009

10

Consumer Price Index

05

2005

06

2006

07

2007

08

2008

09

2009

10

Unemployment Rate

Percent change from year ago

Percent

3

5.5

5.0 2 4.5 1 4.0 0 3.5

3.0

-1 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

Real Monthly Earnings

Current Account Balance

Percent change from year ago

Percent of GDP

2

6

0

5

-2

4

-4

3

-6

2

-8

1

-10

08

2008

09

2009

10

0 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division

28

Federal Reserve Bank of St. Louis

International Economic Trends

Japan Adjusted Monetary Base

Interest Rates

Percent change from year ago

Percent

15

2.0

10 5

1.5

10-Year Government Bonds

0 -5

1.0

-10 -15

0.5

3-Month CDs

-20 -25

0.0 05

2005

06

2006

07

2007

08

2008

09

2009

10

M1

2005

05

06

2006

07

2007

08

2008

09

2009

10

Exchange Rate and Inflation Differential

Percent change from year ago

Yen/US$

6

Percent

124.51

17.46

Exchange Rate (left scale) 4

114.51

8.73

2

104.51

0.00

0

94.51

-8.73

Foreign/US Inflation Differential (right scale) 84.51

-2 05

2005

06

2006

07

2007

08

2008

09

2009

-17.46

2005

10

M2

2006

2007

2008

2009

Real Effective Exchange Rate

Percent change from year ago

Index 2005 = 100

2.5

120 115

2.0 110 1.5

105 100

1.0

95 0.5 90 0.0

85 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division Federal Reserve Bank of St. Louis

29

International Economic Trends

Japan

GDP Percent change from year ago 10

5

Real 0

Nominal -5

-10 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Industrial Production Percent change from year ago 10 0 -10 -20 -30 -40 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Retail Sales Percent change from year ago 10 5 0 -5 -10 -15 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Capacity Utilization 2005 = 100 110 100 90 80 70 60 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division

30

Federal Reserve Bank of St. Louis

International Economic Trends

Japan Real Monthly Earnings and Output per Worker Percent change from year ago 6

Monthly Earnings

Output per Worker

3 0 -3 -6 -9 -12 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Labor Force Indicators Percent change from year ago

Percent

4

7

Unemployment Rate (right scale) 5

2

0

3

Employment (left scale) -2

1 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Inflation Percent change from year ago 8 6 4

Consumer Price Index 2 0 -2

Producer Price Index

-4 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Gross Government Debt and Budget Balance Percent of GDP, annual data

Percent of GDP, annual data

3

185

Budget Balance (left scale)

0

155

-3

125

-6

95

Gross Debt (right scale)

-9 92

93

94

95

96

97

65 98

99

00

01

02

03

04

05

06

07

08

09

Research Division Federal Reserve Bank of St. Louis

31

International Economic Trends

Japan

International Trade - Goods and Services Percent of GDP 20

16

Exports 12

8

Imports 4 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Current Account Balance Percent of GDP 6 5 4 3 2 1 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Foreign Exchange Reserves Billions of US$ 1250 1000 750 500 250 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Real Effective Exchange Rate Index 2000 = 100 165 149 133 117 101 85 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division

32

Federal Reserve Bank of St. Louis

International Economic Trends

Japan Adjusted Monetary Base Percent change from year ago 40 30 20 10 0 -10 -20 -30 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Monetary Aggregates Percent change from year ago 40 30 20

M1 10 0

M2 -10 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Interest Rates Percent 6 5 4

10-Year Government Bonds 3 2

3-Month CDs 1 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Stock Exchange Index - Tokyo Stock Exchange 2005 = 100 150

125

100

75

50 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

33

International Economic Trends

United Kingdom

Real GDP

Employment

Percent change from year ago

Percent change from year ago

4

2

2

1

0

0

-2

-1

-4

-2

-6

-3 05

2005

06

2006

07

2007

08

2008

09

2009

10

Consumer Price Index

05

2005

06

2006

07

2007

08

2008

09

2009

10

Unemployment Rate

Percent change from year ago

Percent

5

8.0 7.5

4 7.0 3

6.5 6.0

2

5.5 1 5.0 0

4.5 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

Real Weekly Earnings

Current Account Balance

Percent change from year ago

Percent of GDP

08

2008

09

2009

10

0

6

-1 5 -2

-3

4

-4 3 -5

-6

2 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division

34

Federal Reserve Bank of St. Louis

International Economic Trends

United Kingdom Notes and Coins in Circulation

Interest Rates

Percent change from year ago

Percent

9

7

8

6

7

5

6

4

5

3

4

2

10-Year Government Bonds 3-Month Interbank Loans

3

1 05

2005

06

2006

07

2007

08

2008

09

2009

10

M2

05

2005

2006

06

07

2007

08

2008

09

2009

10

Exchange Rate and Inflation Differential

Percent change from year ago

Pounds/US$

Percent 3.8

0.55

11

Exchange Rate (left scale) 9

0.53

7

0.51

0.0

| | |

-3.8

Foreign/US Inflation Differential (right scale) 5

-7.6

0.49

3

0.47 05

2005

06

2006

07

2007

08

2008

09

2009

-11.4

2005

10

M4

2006

2007

2008

2009

Real Effective Exchange Rate

Percent change from year ago

Index 2005 = 100 110

21

18 100 15

90

12

9 80 6

3

70 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division Federal Reserve Bank of St. Louis

35

International Economic Trends

United Kingdom

GDP Percent change from year ago 8

Nominal 6 4 2

Real

0 -2 -4 -6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Industrial Production Percent change from year ago 10 5 0 -5 -10 -15 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Retail Sales Percent change from year ago 10

5

0

-5 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Capacity Utilization Percent 90

85

80

75

70 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division

36

Federal Reserve Bank of St. Louis

International Economic Trends

United Kingdom Real Weekly Earnings and Output per Worker Percent change from year ago 12

8

Weekly Earnings 4

0

Output per Worker -4 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Labor Force Indicators Percent change from year ago

Percent

10

12

Unemployment Rate (right scale) 5

9

0

6

Employment (left scale) -5

3 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Inflation Percent change from year ago 12 9

Consumer Price Index 6 3 0

Producer Price Index -3 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Gross Government Debt and Budget Balance Percent of GDP, annual data

Percent of GDP, annual data

4

60

0

50

40

-4

Gross Debt (right scale)

Budget Balance (left scale)

-8 92

93

94

95

96

97

30 98

99

00

01

02

03

04

05

06

07

08

09

Research Division Federal Reserve Bank of St. Louis

37

International Economic Trends

United Kingdom

International Trade - Goods and Services Percent of GDP 38

34

Imports 30

26

Exports 22 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Current Account Balance Percent of GDP 2

0

-2

-4

-6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Foreign Exchange Reserves Billions of US$ 50

40

30

20

10 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Real Effective Exchange Rate Index 2005 = 100 110 100 90 80 70 60 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division

38

Federal Reserve Bank of St. Louis

International Economic Trends

United Kingdom Notes and Coins in Circulation Percent change from year ago 12 10 8 6 4 2 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Monetary Aggregates Percent change from year ago 20

15

M4

M2

10

5

0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Interest Rates Percent 12

10-Year Government Bonds 9

3-Month Interbank Loans 6

3

0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Stock Exchange Index - Financial Times Stock Exchange 2005 = 100 150 125 100 75 50 25 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

39

International Economic Trends

United States

Real GDP

Employment

Percent change from year ago

Percent change from year ago 3

4

2 2

1 0

0 -1 -2

-2

-3 -4

-4 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

Consumer Price Index

Unemployment Rate

Percent change from year ago

Percent

2007

08

2008

09

2009

10

10

6 5

9

4 8 3 7 2 6 1 5

0 -1

4 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

Real Hourly Earnings

Current Account Balance

Percent change from year ago

Percent of GDP

08

2008

09

2009

10

0

4

-2 3

-4

2 -6

-8

1 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division

40

Federal Reserve Bank of St. Louis

International Economic Trends

United States Adjusted Monetary Base

Interest Rates

Percent change from year ago

Percent

120

6

3-Month CDs 100

5

80

4

60

3

40

2

20

1

0

| | | Composite of Long-Term Government Bonds

0 05

2005

06

2006

07

2007

08

2008

09

2009

10

MZM

05

2005

06

2006

07

2007

08

2008

09

2009

10

Exchange Rate and Inflation Differential

Percent change from year ago

TWEX, March 1973 = 100

18

Percent

86.25

6.25

Exchange Rate (left scale)

15 81.25

0.00

12

9

| | | Foreign/US Inflation Differential (right scale)

76.25

6

-6.25

71.25

-12.30

3

0

66.25 05

2005

06

2006

07

2007

08

2008

09

2009

-18.55

2005

10

M2

2006

2007

2008

2009

Real Effective Exchange Rate

Percent change from year ago

Index 2005 = 100 105

10

8 100 6 95 4 90 2

0

85 05

2005

06

2006

07

2007

08

2008

09

2009

10

05

2005

06

2006

07

2007

08

2008

09

2009

10

Research Division Federal Reserve Bank of St. Louis

41

International Economic Trends

United States

GDP Percent change from year ago 9

Nominal 6 3

Real 0 -3 -6 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Industrial Production Percent change from year ago 10 5 0 -5 -10 -15 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Retail Sales Percent change from year ago 10

5

0

-5 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

*Data prior to 1993 may not be strictly comparable with later figures (see Notes).

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Capacity Utilization Percent 85

80

75

70

65 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division

42

Federal Reserve Bank of St. Louis

International Economic Trends

United States Real Hourly Earnings and Output per Worker Percent change from year ago 5

Hourly Earnings 4 3 2 1 0

Output per Worker -1 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Labor Force Indicators Percent change from year ago

Percent 8

4

Unemployment Rate (right scale) 2

6

0

4

Employment (left scale) -2

2 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Inflation Percent change from year ago 12 8

Consumer Price Index 4 0

Producer Price Index -4 -8 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Gross Government Debt and Budget Balance Percent of GDP, annual data

Percent of GDP, annual data

3

80

0

70

-3

60

Budget Balance (left scale)

Gross Debt (right scale)

-6

50 92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

Research Division Federal Reserve Bank of St. Louis

43

International Economic Trends

United States

International Trade - Goods and Services Percent of GDP 21

18

Imports 15

12

Exports 9 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Current Account Balance Percent of GDP 2 0 -2 -4 -6 -8 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Foreign Exchange Reserves Billions of US$ 60

50

40

30

20 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Real Effective Exchange Rate Index 2005 = 100 140 130 120 110 100 90 80 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division

44

Federal Reserve Bank of St. Louis

International Economic Trends

United States Adjusted Monetary Base Percent change from year ago 120 100 80 60 40 20 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Monetary Aggregates Percent change from year ago 25 20

MZM 15 10 5

M2 0 -5 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Interest Rates Percent 10

Composite of Long-Term Government Bonds 8 6 4

3-Month CDs 2 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Stock Exchange Index - New York Stock Exchange 2005 = 100 150 125 100 75 50 25 0 92 92

93 93

94 94

95 95

96 96

97 97

98 98

99 99

00 00

01 01

02 02

03 03

04 04

05 05

06 06

07 07

08 08

09 09

10

Research Division Federal Reserve Bank of St. Louis

45

International Economic Trends

Notes Euro-Area Data: Euro-area countries are Austria, Belgium, Cyprus, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, Slovakia, and Spain. Data series are break adjusted and include all euro area countries for the full sample, with these exceptions: Series for interest rates are not break adjusted. Historical euro area series for government debt and budget balance do not include Slovenia, Cyprus, Malta, and Slovakia. Euro-area interest rates prior to December 1998 are calculated on the basis of national government yields weighted by GDP. Starting in 1999, short-term rates are euro interbank offered rates. Long-term rates are calculated on the basis of national government bond yields weighted by the nominal outstanding amounts of government bonds in each maturity band. The euro/dollar exchange rate used in the chart on page 12 is a synthetic rate prior to January 1999. This is constructed by calculating a weighted average of the exchange rates of the euro-area countries, excluding Greece and Luxembourg, against the dollar. The weights are based on 1997 GDP shares. German Data: As a result of reunification, data for all of Germany are now incorporated in the statistical series. The starting periods for unified German data are listed below. Care should be exercised when interpreting the data around these break periods. Third quarter 1992: capacity utilization. First quarter 1993: stock exchange index. Third quarter 1993: employment. First quarter 1995: hourly earnings. Capacity Utilization covers the manufacturing sector for Canada, France, Japan, the United Kingdom, the United States, and the euro area; manufacturing excluding food, beverage, and tobacco for Germany; and mining and manufacturing for Italy. Consumer Price Index is for all items. The current index is based on goods and services consumed by all individuals for Canada; all multi-person households excluding those mainly engaged in agriculture, forestry, and fisheries for Japan; all households except pensioners dependent on state pension and high income households for the United Kingdom; and all urban households for the United States. Data for the euro area, France, Germany, and Italy are based on the harmonized index of consumer prices. Current Account Balance is the sum of merchandise and service exports and income receipts on domestic assets abroad minus the sum of merchandise and service imports and income payments from foreign assets in the domestic economy plus net unilateral transfers. Real Earnings are based on hourly earnings in manufacturing for Canada, Germany, the United States, and the euro area; hourly earnings in manufacturing excluding construction for France, hourly earnings in industry for Italy; monthly earnings in manufacturing for Japan; and weekly earnings in manufacturing for the United Kingdom. The Exchange Rate for all countries except the United States is expressed as units of local currency per U.S. dollar. For the United States the trade-weighted exchange rate, TWEX, is used. This is a weighted average of the exchange value of the U.S. dollar relative to the major international currencies—the euro, Canadian dollar, Japanese yen, British pound, Swiss franc, Australian dollar, and Swedish kronor. Prior to 1999, the currencies of the euro-area countries (with the exception of Greece) are used instead of the euro. Real Effective Exchange Rate uses normalized unit labor costs in manufacturing. The weighting scheme used to construct the rates, for all except the euro area, is based on disaggregated data for trade among 21 industrial countries in manufactured goods for 2005. For the euro area the weights relate to the trade of the euro area with the other countries. The weights reflect the relative importance of a country’s trading partners in its direct bilateral trade relations and competition in third markets. Normalized unit labor costs in manufacturing are calculated by dividing an index of actual hourly compensation per worker by a five-year moving average index of output per man-hour. Employment data refer to civilian employment for Canada, Germany, Italy, Japan, and the United States; industrial employment for France; and total employment for the euro area and the United Kingdom.

46

Notes and Sources Foreign Exchange Reserve data are end of period. The dollar value of reserves may fluctuate as a result of changes in reserve holdings and/or changes in the value of the currencies held vis-à-vis the U.S. dollar. Government Budget Balance is the difference between general government current receipts and total outlays. Total outlays consist of current expenditures and net capital expenditures. Gross Government Debt incorporates all financial liabilities of the general government sector. The general government sector consolidates the accounts of the central, state, local, and social security sectors. Cumulative Inflation Differential is the cumulative change in the foreign consumer price index (CPI) over the change in the U.S. CPI, in percentage terms. The base period for the cumulative rate of change is taken to be the first period of the chart. For example, if the base period is 2002:Q1, then the cumulative inflation differential for Japan for 2006:Q3 is as follows: J ⎛ P2006 ⎞ Q3 J ⎜ ⎟ P2002 Q1 ⎜ • inflationdifferential = 100 − 1⎟ ⎜ P2US ⎟ 006Q 3 US ⎜ ⎟ P2002 ⎝ ⎠ Q1

J is the Japanese CPI in the third quarter of 2006. For the U.S. chart where P2006Q3 on page 41, foreign CPI is calculated as the weighted average of the CPIs of countries whose currencies are used in the major currency trade-weighted exchange rate index. Starting in 1999, the euro-area harmonized consumer price index is used for the euro area. Prior to 1999, the price levels for the individual euro area countries (excluding Greece and Luxembourg) are used. The cumulative inflation differential is shown because the theory of purchasing power parity states that exchange rate changes should be systematically positively related to this variable.

Industrial Production measures the change in the volume of output in the mining, manufacturing, oil, electricity, gas, and water industries. The Short-Term Interest Rate table on page 4 uses the relevant 3-month interest rate shown in the country pages. The Long-Term Interest Rate table on page 4 uses the government bond rate. The government bond rate is a composite of yields on federal government bonds with maturities of more than 10 years for the United States; 10-year benchmark bonds for France; 7- to 15-year public sector bonds for Germany; 15- to 20-year government bonds through 1990 and 10-year government bonds starting in 1991 for Italy; and 10-year government bonds for Canada, the euro area, Japan, and the United Kingdom. The Reserve Money table on page 4 refers to the adjusted monetary base for Japan and the United States; reserve money for Canada; and M0 for the United Kingdom. Reserve Money is currency in circulation, deposits of the deposit money banks, and demand deposits of other residents (with the exception of the central government) with the monetary authority. Adjusted Monetary Base Japan: currency in circulation and current deposits at the Bank of Japan. United States: the sum of currency in circulation outside Federal Reserve banks and the U.S. Treasury, deposits of depository financial institutions at Federal Reserve banks, and an adjustment for the effects of changes in statutory reserve requirements on the quantity of base money held by depositories. Notes and Coins in Circulation United Kingdom: After reforming the rules governing bank reserves, the Bank of England discontinued its M0 series in May 2006 because the data would not be comparable to previous data. IET now presents a related series, “Notes and Coins in Circulation,” in place of M0. The Bank of England directs interested parties to “Publication of narrow money data: the implication of money market reform” in its Autumn 2005 Quarterly Bulletin (http://www.bankofengland.co.uk/publications/quarterlybulletin/qb050304.pdf). M1 Japan: cash, currency in circulation, and deposit money. Euro area: currency in circulation and overnight deposits. M1B Canada: currency outside banks, chartered bank checkable deposits, less inter-bank checkable deposits. Research Division Federal Reserve Bank of St. Louis

Notes and Sources MZM United States: currency in circulation, travelers’ checks, total publicly-held checkable deposits minus cash items in the process of collection and Federal Reserve float, savings deposits, shares in retail money market mutual funds (funds with initial investments of less than $50,000), net of retirement accounts, and institutional money market mutual funds. M2 Canada: currency outside banks, chartered bank demand and notice deposits, chartered bank personal term deposits, adjustments to M2 (continuity adjustments and inter-bank demand and notice deposits). United Kingdom: currency in circulation and sterling retail deposits with the U.K. banks and building societies. United States: MZM less institutional money market mutual funds plus small denomination (less than $100,000) time deposits. M2 + CDs Japan: M1 plus private deposits, public deposits less demand deposits, and certificates of deposit. M3 Euro area: M1 plus deposits with a maturity up to 2 years, deposits redeemable at notice up to 3 months, repurchase agreements, money market funds, and debt securities up to 2 years. M4 United Kingdom: M2 plus wholesale deposits with the U.K. banks and building societies. Output Per Worker is the ratio of real GDP to employment. Producer Price Index covers manufacturing for Canada and the United Kingdom; and total industry for Japan and the United States. Data for the euro area, France, Germany, and Italy are based on the harmonized index of total industry excluding construction. Retail Sales are based on a volume index. The percent change in retail sales for the United States is based on the Standard Industrial Classification system through 1992 and the North American Industrial Classification System from 1993 on. Stock Exchange Index refers to all share prices except for the United Kingdom, which excludes financial firms. Unemployment Rate is the standardized unemployment rate. It is the percentage of the civilian labor force that is unemployed. The unemployed are all persons of working age who are without work, readily available for work, and actively seeking work. The standardized rate may differ from the national unemployment rate calculations.

Sources Abbreviations Board of Governors of the Federal Reserve System (BOG) Bureau of Economic Analysis, U.S. Department of Commerce (BEA) Bureau of Labor Statistics, U.S. Department of Labor (BLS) International Monetary Fund, International Financial Statistics (IMF) Organization for Economic Cooperation and Development, Economic Outlook (OECD1) Main Economic Indicators (OECD2) National Accounts Quarterly (OECD3) Canada Bank of Canada: M1B and M2. BOG: exchange rate. IMF: foreign exchange reserves, merchandise and service trade, real effective exchange rate, and reserve money. OECD1: gross government debt and budget balance. OECD2: capacity utilization, consumer price index, current account balance, GDP, hourly earnings, industrial production, interest rates, producer price index, retail sales, stock exchange index, and unemployment rate. Statistics Canada: employment. Euro Area European Central Bank: currrent account balance and employment . Eurostat: capacity utilization, consumer price index, GDP, interest rates, merchandise trade, producer price index, and retail sales.

Research Division Federal Reserve Bank of St. Louis

International Economic Trends Haver Analytics: synthetic euro exchange rate. IMF: real effective exchange rate. OECD1: gross government debt and budget balance. OECD2: hourly earnings, industrial production, M1, M3, stock exchange index, and unemployment. France BOG: exchange rate. Eurostat: capacity utilization, consumer price index, and producer price index. IMF: foreign exchange reserves, merchandise and service trade, and real effective exchange rate. Institut National de la Statistique et des Etudes Economiques: employment. OECD1: gross government debt and budget balance. OECD2: current account balance, GDP, hourly earnings, industrial production, retail sales, interest rates, stock exchange index, and unemployment. Germany BOG: exchange rate. Bundesanstalt Fur Arbeit: employment. Eurostat: capacity utilization, consumer price index, and producer price index. IMF: foreign exchange reserves, merchandise and service trade, and real effective exchange rate. OECD1: gross government debt and budget balance. OECD2: current account balance, GDP, hourly earnings, industrial production, M1, M3, retail sales, interest rates, stock exchange index, and unemployment. Statistical Office of Germany: new hourly earnings. Italy BOG: exchange rate. Eurostat: capacity utilization, consumer price index, and producer price index. IMF: foreign exchange reserves, merchandise and service trade, and real effective exchange rate. Instituto Nazionale di Statistica: employment. OECD1: gross government debt and budget balance. OECD2: current account balance, GDP, hourly earnings, industrial production, long-term interest rates, retail sales, stock exchange index, and unemployment. Japan Bank of Japan: adjusted monetary base and long-term interest rate. BOG: exchange rate. IMF: foreign exchange reserves, merchandise and service trade, and real effective exchange rate. OECD1: gross government debt and budget balance. OECD2: capacity utilization, consumer price index, current account balance, employment, GDP, hourly earnings, industrial production, M1, M2, producer price index, retail sales, short-term interest rate, stock exchange index, and unemployment. United Kingdom Bank of England: M2. BOG: exchange rate. IMF: foreign exchange reserves, merchandise and service trade, and real effective exchange rate. OECD1: gross government debt and budget balance. OECD2: capacity utilization, consumer price index, current account balance, GDP, industrial production, interest rates, M4, producer price index, retail sales, stock exchange index, unemployment, and weekly earnings. U.K. Office for National Statistics: employment and Notes and Coins in Circulation. United States BOG: capacity utilization, exchange rate, industrial production index, M2, and interest rates. BEA: GDP, current account balance, merchandise and service trade, and retail sales. BLS: employment, consumer price index, and producer price index. Federal Reserve Bank of St. Louis: adjusted monetary base and MZM. IMF: foreign exchange reserves and real effective exchange rate. OECD1: gross government debt and budget balance. OECD2: hourly earnings, stock exchange index, and unemployment.

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