Canada April factory sales likely fell by 1.1% - Statscan flash estimate - Reuters

OTTAWA, May 25 (Reuters) - Canadian factory sales likely fell 1.1% in April from March, Statistics Canada said in a flash estimate on Tuesday. The decrease is mostly attributed to lower sales in the transportation equipment industry.

Factory sales rose 3.5% in March.

Statscan said the estimate had been calculated based on responses received from 47% of companies surveyed. The average final response rate for the survey over the past 12 months has been 91.5%, it added.

U.S. consumer confidence little changed in May - Reuters News

May 25 (Reuters) - U.S. consumer confidence was little changed in May as consumers' short-term optimism of conditions retreated on expectations for decelerating growth and softening labor market conditions in the months ahead.

The Conference Board said on Tuesday its Consumer Confidence Index dipped to a reading of 117.2 this month, following a reading of 117.5 in April. Economists polled by Reuters had forecast a reading of 119.2 in May. 

U.S. April single-family home sales data - Reuters News

May 25 (Reuters) - U.S. Commerce Department reported sales of new single-family homes, seasonally adjusted, with percent changes from prior month (numbers in 1,000s).

                           Pct   Apr    Mar   Apr'20

Total units:             -5.9   863    917     582

By  region:               Pct   Apr    Mar

Northeast               -13.7    44     51

Midwest                  -8.3   110    120

South                    -8.2   545    594

West                      7.9   164    152

Total sales of new single-family homes rose 48.3 percent from April 2020.

In 1,000s:                       Apr    Mar

Actual units sold:                78     86

Sale prices:

Median:                        372.4  334.2

Average:                       435.4  400.5

Note: Actual number of new single-family units sold is not seasonally adjusted.

Number of months:               Apr    Mar

Supply of homes                 4.4    4.0

1,000 units                     Apr    Mar

End-month inventory             316    304

FORECAST:

Reuters survey of economists forecast:

U.S. April new home sales 0.970 mln units

U.S. home prices rose more than expected in March - S&P Case-Shiller - Reuters News

By Evan Sully

May 25 (Reuters) - U.S. single-family home prices in 20 key urban markets rose in March from a year earlier by the most in more than seven years, a closely watched survey said on Tuesday.

The S&P/Case Shiller composite index of 20 metropolitan areas gained 13.3% through the 12 months ended in March on a seasonally adjusted basis, the largest annual price increase since December 2013. A Reuters poll of economists had forecast a 12.3% increase.

On month-to-month basis, the 20-city composite index rose 1.6% from February. Economists polled by Reuters had been expecting a 1.2% increase. 

U.S. existing home sales fell for a third straight month in April as an acute shortage of properties drove prices to a record high, data from the National Association of Realtors showed on Friday. (Full Story)

Later on Tuesday, the Commerce Department will report new home sales for April, which are expected to moderate again.

Summer boom beckons for German economy after winter COVID blues - Reuters News

• Ifo business climate index jumps to 2-yr high in May
• Economy picking up speed, survey's president says
• German GDP shrank more than expected in Q1
• Consumers expected to splash out over summer
• KfW bank lifts GDP growth forecast to 3.5% in 2021

By Michael Nienaber and Rene Wagner

BERLIN, May 25 (Reuters) - German business morale brightened to hit a two-year high in May as COVID-19 curbs were eased and infections fell, heralding a swift summer recovery after the economy shrank more than expected in the first quarter.

With many firms reporting a build-up of supply bottlenecks, Tuesday's Ifo business climate index readout showed a jump to 99.2, up from April's revised 96.6 and beating the 98.2 forecast in a Reuters poll of analysts. 

"The German economy is picking up speed," Ifo President Clemens Fuest said.

The survey among some 9,000 firms in manufacturing, the service sector, trade and construction showed that businesses were more satisfied with their current situation and optimistic regarding the coming six months.

It pointed to a quarterly growth rate of 2.6% from April to June and 2.8% from July to September, Ifo economist Klaus Wohlrabe told Reuters.

In the first quarter, GDP contracted by 1.8% quarter on quarter and by 3.1% on the year, significantly weaker readings than the euro zone average, Federal Statistics Office data showed earlier on Tuesday. (Full Story)

Coronavirus curbs in force during those months also spurred consumers to put more money than ever into savings, with the savings rate ballooning to an unprecedented 23.2%.

German households' disposable income increased slightly as the government ploughed billions of euros into job protection schemes and extra child benefits, but household spending fell by 5.4% on the quarter as curbs linked to containing the pandemic crimped consumption.

'SPLASHING OUT'

VP Bank Group economist Thomas Gitzel called that drop "colossal", but also said falling infection rates and progress in inoculations meant the economy would soon be back on a healthier footing as restrictions were eased and then lifted altogether.

"We're heading towards a relaxed summer in which retailers in German cities can expect consumers to splash out," he said.

Company investments in machinery and equipment fell slightly in the first quarter, though construction activity rose, the GDP data showed.

Wohlrabe said rising costs due to supply bottlenecks in manufacturing and construction were now increasingly being passed on.

In construction, two out of five firms reported difficulties procuring raw materials, and "more and more companies indicate that they want to increase their sales prices," he said.

KfW bank economist Fritzi Koehler-Geib said her bank had raised its 2021 growth forecast to 3.5% from 3.3% "despite the poor start to the year."

Commerzbank economist Joerg Kraemer said his bank continued to expect German GDP to grow by 4.0% in 2021.

"A post-corona boom is emerging – even if the air is starting to get thin in the manufacturing sector, where business sentiment is already at a very high level," he added.

UK retail sales slip back after post-lockdown surge - Reuters News

By David Milliken

LONDON, May 25 (Reuters) - British retailers said sales fell back to more normal volumes earlier this month after a flurry of demand in April when a relaxation in lockdown rules allowed non-essential shops to reopen for the first time in months.

The Confederation of British Industry said its monthly balance for whether sales were above or below normal for the time of year dropped to -3 in May from +16 in April, indicating roughly normal volumes.

"Some retailers have suggested the increase in demand after the initial reopening of non-essential retail in early April was either short-lived or less strong than expected," CBI economist Ben Jones said.

Clothing and specialist food stores reported below-average sales, while demand remained strong at supermarkets, hardware and furniture shops.

Official retail sales data for April showed sales volumes jumped by a hefty 9.2% month-on-month and that volumes were 10% higher than pre-crisis levels. (Full Story)

The CBI survey covered the period April 28 to May 17 - before pubs and restaurants were allowed to serve customers indoors - and was based on responses from 45 retail chains.

Busier town centres in coming weeks might encourage more shoppers to return to the high street rather than continue to shop online, it added.

The Bank of England is keeping a close eye on consumer spending to gauge how rapid Britain's economic rebound from COVID is likely to be. It forecasts growth of 7.25% this year after output fell nearly 10% in 2020.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the CBI retail data was often weaker than other measures.

"The relative weakness of the CBI's survey might be because its sample often overweights high-street retailers and under-represents online-only retailers," he said.

Separate quarterly data from the CBI, also released on Tuesday, showed retailers planned to increase investment by the most since February 1994 over the next 12 months but staff numbers had fallen sharply over the past year.