For more information, visit http://www.worldbank.org/prospects May 19, 2017 Taking Stock U.S. industrial production surged in April; new housing construction declined. U.S. industrial production rose 1 percent (m/m, sa) in April, the largest gain since February 2014, following a 0.4 percent increase in March (Figure 1). Manufacturing output—the largest component of industrial production—rose 1 percent, led by a large increase in the production of motor vehicles and parts. Mining output advanced 1.2 percent in April, owing to gains in coal mining and in drilling. Utility output rose 0.7 percent, as an increase in electricity generation was offset by lower gas output. Separately, both housing starts and permits to build new homes fell in April. Housing starts fell to their lowest level in five months, amid persistent weakness in the construction of multi-family housing units. Euro Area Q1 GDP growth held steady; annual inflation confirmed at 1.9 percent in April. The second reading of Euro Area GDP growth in Q1 came in at 0.5 percent (q/q, sa), in line with the preliminary flash estimate, and at the same level as in Q4 2016. Separately, the final reading of consumer price inflation for April came in at 1.9 percent (y/y), similar to the flash estimate, and up from 1.5 percent in March. Core inflation—which excludes energy and food prices—was also confirmed at 1.2 percent, compared with 0.7 percent in March. Japan posted strong GDP growth in Q1; producer prices rose sharply in April. The preliminary estimate of Japan’s GDP growth for Q1 came in at 2.2 percent (q/q, saar) in Q1 2017, up from 1.2 percent in the previous quarter. The stronger- than-expected Q1 growth was broad-based, with private consumption and exports as key drivers. Meanwhile, Japan’s producer price index (PPI) rose 2.1 percent (y/y) in April—the fastest rise since November 2014—following a 1.4 percent increase in March. The higher-than-expected PPI reading reflected a pick-up in commodity prices. Growth in China’s retail sales, fixed asset investment, and industrial production slowed in April. Retail sales rose 10.7 percent (y/y), compared with 10.9 percent in March, reflecting a slowdown in sales growth at China’s larger enterprises (Figure 2). Urban fixed-asset investment growth came in at 8.9 percent (y/y) in April, below March’s 9.2 percent gain, mainly due to a slowdown in private investment growth. Industrial production expanded 6.5 percent (y/y), compared with 7.4 percent in March, as automobile production and electricity generation slowed. These figures point to a slow second quarter start for the Chinese economy. Inflation continued to ease in Angola in April, and it was marginally lower in Nigeria. Consumer price inflation in Angola was 34.8 percent (y/y) in April, down from 36.5 percent in March, partly reflecting reduced currency pressures as the central bank stepped up its US dollar sales. In Nigeria, inflation eased marginally from 17.3 percent (y/y) in March to 17.2 percent in April, as a slowdown in non-food price inflation was offset by rising food price inflation. Figure 1 U.S. industrial production surged in April. Figure 2 Growth in China’s retail sales, fixed asset investment, and industrial production slowed in April. U.S. Industrial production growth Chinese indicators Percent Percent, year-over-year Retail sales 3.0 12 Investment Industrial production 2.0 10 1.0 8 0.0 6 -1.0 4 Jan-15 Jan-16 Jan-17 Jan-16 Jan-17 Apr-15 Oct-15 Apr-16 Oct-16 Apr-17 Apr-16 Oct-16 Apr-17 Jul-15 Jul-16 Jul-16 Source: Haver Analytics. Source: Haver Analytics. Produced by DECPG. Number 347 | May 19, 2017 Major Data Releases (Percent change y-o-y) (Percent change y-o-y) Recent releases: Fri, 12 May - Thu, 18 May 2017 Upcoming releases: Fri, 19 May - Thu, 25 May 2017 Country Date Indicator Period Actual Forecast Previous Country Date Indicator Period Previous Thailand 5/15/17 GDP Q1 3.3 % 3.2 % Germany 5/23/17 GDP Q1 1.7 % Italy 5/16/17 GDP Q1 0.8 % 1.0 % 1.0 % Hong Kong 5/23/17 CPI APR 0.5 % Czech Republic 5/16/17 GDP Q1 2.9 % 1.9 % South Africa 5/24/17 CPI APR 6.1 % Eurozone 5/16/17 GDP Q1 1.7 % 1.7 % 1.7 % Spain 5/25/17 GDP Q1 3.0 % Japan 5/17/17 GDP Q1 1.6 % 1.8 % 1.2 % UK 5/25/17 GDP Q1 2.1 % Malaysia 5/18/17 GDP Q1 5.6 % 4.5 % Japan 5/25/17 CPI APR 0.2 % Activity and Inflation (Percent change y-o-y, except quarterly data on industrial production, which are percent change q-o-q, annualized) 2016 2016 2017 2015 2016 Q1 Q2 Q3 Q4 Apr May June July Aug Sep Oct Nov Dec Jan Feb Mar 1 ndustrial Production, sa World 1.8 2.2 1.9 2.2 2.9 5.3 1.7 1.9 2.1 1.8 2.4 2.1 2.2 3.3 3.7 3.1 3.5 4.0 Advanced Economies 0.2 0.2 0.3 0.3 1.8 3.9 -0.2 -0.3 -0.2 -0.4 0.6 0.3 0.2 1.9 2.5 1.1 2.2 2.2 Emerging Market and Developing Economies 3.5 4.2 3.6 4.1 4.0 6.8 3.7 4.1 4.4 4.1 4.3 3.9 4.2 4.7 4.9 5.1 4.8 5.8 Commodity-exporting EMDE 0.2 1.2 0.5 1.7 2.3 4.3 -0.7 0.6 1.7 2.0 1.3 1.0 1.3 2.1 3.2 2.8 2.2 - Other EMDE 5.0 5.4 4.7 5.1 4.6 7.8 5.6 5.7 5.5 4.9 5.5 5.0 5.3 5.7 5.6 6.0 5.7 6.7 East Asia and Pacific 5.8 5.9 5.1 6.7 5.7 6.0 5.6 6.0 6.2 6.1 6.3 5.6 5.6 5.9 6.0 6.0 6.2 7.2 East Asia excl. China 3.5 4.9 6.3 4.9 4.0 3.1 2.9 6.0 7.0 6.9 6.1 2.4 2.8 4.6 6.3 3.9 5.1 5.0 Europe and Central Asia 1.4 2.1 1.5 1.8 -3.5 9.6 2.7 2.9 2.2 0.2 1.8 0.5 1.5 2.7 2.5 4.2 1.1 4.1 Latin America and Caribbean -3.1 -2.9 -3.5 0.5 0.4 -1.2 -4.7 -3.9 -2.3 -2.2 -2.9 -2.0 -2.8 -1.0 0.9 0.0 0.6 -1.2 Middle East and North Africa 2.8 - 2.7 -3.2 8.8 - 2.0 2.4 2.9 3.7 3.1 4.3 6.5 - - - - - South Asia 3.5 5.7 7.0 4.3 2.5 4.4 6.4 7.3 6.8 6.0 5.4 4.5 5.1 5.7 2.8 4.0 2.2 3.3 Sub-Saharan Africa 0.1 0.9 1.5 7.1 -6.4 -3.5 2.6 4.1 4.3 1.4 0.1 -0.1 -1.1 0.6 -0.9 0.1 -2.7 -2.5 nflation, sa 2 World 1.4 1.3 1.4 1.7 1.4 1.7 1.8 1.8 1.7 1.7 1.4 1.5 1.5 1.6 1.8 2.3 2.5 2.4 Advanced Economies 0.1 0.4 0.3 0.2 0.4 0.8 0.2 0.1 0.4 0.4 0.4 0.5 0.6 0.7 1.1 1.5 1.8 1.6 Emerging Market and Developing Economies 2.4 2.4 2.7 3.0 2.9 2.6 3.2 2.8 2.6 2.9 2.9 2.9 2.5 2.5 2.7 3.1 3.5 3.6 Commodity-exporting EMDE 3.8 3.5 3.9 3.9 3.4 3.3 4.0 3.6 3.9 3.8 3.3 3.1 3.2 3.2 3.2 3.5 3.8 3.8 Other EMDE 1.0 1.1 1.1 2.0 1.7 1.7 1.9 1.7 1.8 1.8 1.5 1.6 1.5 1.6 1.8 2.6 3.2 3.5 East Asia and Pacific 1.0 1.6 1.1 2.2 2.7 2.5 2.0 2.1 2.0 2.1 2.2 2.6 2.4 2.4 2.4 3.0 3.5 3.5 Europe and Central Asia 1.9 0.4 0.7 0.3 0.5 1.0 0.2 0.3 0.4 1.2 0.5 0.5 0.9 0.9 1.5 2.3 2.5 2.7 Latin America and Caribbean 2.7 2.4 2.7 3.5 3.0 3.1 3.6 3.4 3.3 2.9 3.2 3.1 2.9 3.2 3.2 3.1 3.4 3.3 Middle East and North Africa 1.9 2.2 2.5 2.4 2.3 1.9 2.5 2.2 2.4 2.3 2.1 2.5 1.9 2.0 1.8 2.2 2.5 2.9 South Asia 4.5 4.9 3.8 5.3 5.3 3.9 4.6 5.2 5.7 5.7 5.2 5.0 4.2 3.7 3.7 3.7 4.2 5.0 Sub-Saharan Africa 3.7 5.3 5.2 5.2 5.7 5.9 5.3 4.8 5.6 5.5 5.9 5.9 5.7 6.2 6.7 6.9 6.7 7.0 1 Industrial production is total production (may exclude construction). When data are unavailable, "industral production, manufacturing" and "industrial production, manufacturing, non-durable manufacturing, petroleum and coal products, crude petrolem products" are used as proxies 2 Median inflation rate for each grouping. Trade and Finance (Percent change y-o-y, except quarterly trade data, which are percent change q-o-q, annualized, and international reserves data, which are percent change over the previous period) 2016 2016 2017 2015 2016 Q1 Q2 Q3 Q4 Apr May June Jul Aug Sep Oct Nov Dec Jan Feb Mar Exports, Nominal, US$, sa World -11.5 -3.0 -12.4 14.1 0.3 7.5 -2.8 -3.3 -4.2 -6.8 2.8 -0.7 -3.3 4.9 4.0 10.4 7.1 12.1 Advanced Economies -11.3 -0.8 -4.8 15.1 0.3 3.6 -0.1 -0.5 -2.4 -5.3 5.6 1.5 -1.8 6.2 5.6 9.1 7.2 8.9 Emerging Market and Developing Economies -12.0 -6.6 -23.9 12.4 0.2 15.0 -7.1 -7.7 -7.2 -9.2 -1.7 -4.4 -5.7 3.0 1.6 12.8 6.9 17.9 Commodity-exporting EMDE -24.2 -9.3 -27.5 15.2 5.8 28.6 -14.4 -12.7 -13.7 -15.2 -1.9 -1.7 -5.8 7.6 8.1 27.1 19.8 25.2 Other EMDE -3.8 -4.6 -21.2 11.3 -1.7 10.2 -2.7 -4.6 -3.1 -5.7 -1.0 -5.0 -5.1 1.8 -0.5 7.9 2.5 15.3 East Asia and Pacific -3.5 -6.1 -25.3 12.6 -2.0 11.0 -4.2 -6.2 -5.5 -6.9 -1.7 -6.9 -6.0 1.7 -2.2 9.3 2.6 16.3 Europe and Central Asia -20.7 -6.1 -19.0 18.4 -0.5 20.2 -8.0 -10.6 -4.2 -8.8 0.5 -1.1 -3.6 6.5 7.7 22.2 12.7 20.9 Latin America and Caribbean -11.9 -2.4 -6.6 7.4 7.4 15.0 -5.2 -2.0 -8.0 -7.6 2.6 2.8 -4.4 10.3 11.0 14.9 12.4 16.8 Middle East and North Africa -27.1 - - - - - - - - - - - - - - - - - South Asia -4.8 1.6 6.1 4.5 -18.0 32.2 0.8 -0.3 5.1 -4.0 5.8 -3.2 10.7 3.4 0.2 2.8 2.1 11.6 Sub-Saharan Africa -26.8 -14.8 -40.5 22.7 -6.0 34.7 -15.9 -17.7 -18.5 -22.5 -13.0 -2.8 -11.0 0.3 5.2 - - - mports, Nominal, US$, sa World -6.8 -5.3 -23.8 16.1 -16.5 21.2 4.2 -4.2 -4.4 -10.9 -6.9 -5.7 -9.7 3.5 -1.7 11.6 5.5 10.4 Advanced Economies -12.5 -3.4 -9.0 8.2 -2.4 1.9 -4.0 -1.9 -4.6 -8.2 1.7 -1.9 -5.0 2.3 1.2 9.4 3.1 8.4 Emerging Market and Developing Economies -3.3 -6.4 -31.1 21.0 -24.0 34.6 9.2 -5.6 -4.3 -12.5 -11.7 -7.9 -12.2 4.3 -3.3 12.9 7.0 11.7 Commodity-exporting EMDE -0.9 -7.2 -33.2 22.3 -30.2 39.4 14.1 -6.8 -4.0 -12.8 -15.6 -9.9 -15.0 4.2 -5.3 12.1 - - Other EMDE -11.5 -3.7 -21.8 16.4 2.5 19.1 -7.9 -0.9 -5.8 -11.4 3.2 -0.3 -0.6 5.0 3.6 15.6 23.7 20.4 East Asia and Pacific -13.1 -3.7 -24.4 18.3 5.6 21.8 -8.1 0.4 -6.8 -11.0 5.6 -0.1 -0.9 6.0 5.5 17.1 33.7 21.0 Europe and Central Asia -21.4 -2.0 0.8 12.2 -2.3 6.6 -4.9 -1.8 0.1 -10.1 8.4 1.2 0.7 5.3 6.6 22.0 8.5 15.3 Latin America and Caribbean -9.8 -7.4 -16.6 6.5 2.4 5.6 -9.4 -6.2 -8.8 -15.5 1.5 -3.3 -8.4 1.6 3.9 11.2 5.3 13.5 Middle East and North Africa 1.5 - - - - - - - - - - - - - - - - - South Asia -13.2 -5.4 -27.6 6.3 10.9 51.3 -17.9 -8.5 -5.9 -13.9 -9.1 1.1 7.9 10.1 2.2 14.8 22.0 40.5 Sub-Saharan Africa -7.6 - - - - - - - - - - - - - - - - - 1 nternational Reserves, US$ World -5.9 -1.1 0.7 0.8 0.4 -3.3 0.7 -0.7 0.8 0.3 -0.1 0.2 -1.1 -1.7 -0.6 0.7 0.3 0.6 Advanced Economies 0.6 4.4 3.7 1.7 1.4 -2.5 1.0 -0.6 1.4 0.5 0.1 0.9 -0.7 -1.5 -0.2 1.5 0.4 1.3 Emerging Market and Developing Economies -9.9 -4.8 -1.2 0.2 -0.2 -3.9 0.5 -0.8 0.5 0.2 -0.2 -0.2 -1.4 -1.8 -0.9 0.1 0.2 0.2 Commodity-exporting EMDE -11.1 - -1.0 -0.7 -0.2 - 0.3 -0.9 0.0 0.4 -0.5 -0.1 -1.7 -1.1 - - - - Other EMDE -9.1 -5.7 -1.2 0.7 -0.3 -4.5 0.7 -0.8 0.7 0.1 -0.1 -0.2 -1.2 -2.1 -1.2 0.0 0.2 0.3 East Asia and Pacific -11.3 -7.3 -1.8 0.3 -0.7 -4.9 0.5 -1.0 0.9 0.0 -0.3 -0.4 -1.3 -2.4 -1.2 -0.1 0.4 0.1 Europe and Central Asia -6.3 4.4 4.1 2.7 1.2 -3.9 1.5 -0.2 1.4 0.5 0.5 0.3 -0.8 -1.7 -1.4 2.1 0.4 0.6 Latin America and Caribbean -5.3 1.1 0.1 0.7 1.6 -0.9 0.8 -0.2 0.1 1.6 0.0 -0.1 -0.6 -0.6 0.1 0.5 0.4 -0.1 Middle East and North Africa -17.1 - -3.6 -2.6 -2.0 - -0.5 -0.8 -1.3 -0.7 -0.8 -0.5 -2.6 - - - - - South Asia 11.6 3.5 1.0 2.0 3.3 -2.8 1.9 -0.8 0.8 1.4 0.6 1.4 -1.0 -0.9 -0.9 -0.1 0.5 1.5 Sub-Saharan Africa -12.0 - -2.0 -1.9 - - 0.4 -1.7 - - - - - - - - - - 1 Total reserves excluding gold are used as proxies when total reserves data are unavailable. Produced by DECPG. Number 347 | May 19, 2017 Financial Markets 2016 2017 2016 2017 MRV 1 2015 2016 Q2 Q3 Q4 Q1 May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Interest rates and LIBOR (percent) U.S. Fed Funds Effective 0.13 0.40 0.37 0.39 0.45 0.70 0.36 0.38 0.39 0.40 0.40 0.41 0.41 0.55 0.66 0.66 0.79 0.91 0.91 ECB repo 0.05 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 US$ LIBOR 3-months 0.32 0.74 0.64 0.79 0.92 1.07 0.65 0.65 0.70 0.81 0.85 0.88 0.91 0.98 1.03 1.04 1.13 1.16 1.18 EURIBOR 3-months -0.02 -0.26 -0.26 -0.30 -0.31 -0.33 -0.26 -0.27 -0.29 -0.30 -0.30 -0.31 -0.31 -0.32 -0.33 -0.33 -0.33 -0.33 -0.33 US 10-yr Treasury yield 2.12 1.84 1.75 1.56 2.12 2.44 1.80 1.64 1.48 1.56 1.63 1.74 2.12 2.50 2.44 2.42 2.47 2.29 2.30 German Bund, 10 yr 0.54 0.14 0.12 -0.07 0.18 0.35 0.16 0.01 -0.09 -0.07 -0.05 0.03 0.22 0.30 0.34 0.32 0.39 0.25 0.44 Spreads (basis points) JP Morgan Emerging Markets 415 410 419 372 369 340 418 418 387 367 361 357 380 370 354 338 329 331 316 Asia 224 221 227 197 197 175 223 233 210 190 191 192 201 198 185 173 166 173 167 Europe 348 302 305 282 283 261 305 303 290 282 273 274 294 282 272 258 253 250 234 Latin America & Caribbean 540 537 551 477 475 445 552 541 496 473 463 453 491 481 463 442 431 431 414 Middle East 456 517 538 508 467 396 530 545 540 492 493 487 475 438 416 396 377 350 347 Africa 415 518 548 461 436 389 552 546 494 448 440 441 444 422 401 387 380 400 369 Stock Indices (end of period) Global (MSCI) 399 424 399 418 424 449 403 399 414 417 418 413 413 424 433 445 449 455 463 Advanced Economies ($ Index) 1663 1761 1653 1726 1761 1854 1675 1653 1713 1720 1726 1697 1712 1761 1792 1839 1854 1878 1906 United States (S&P 500) 2044 2258 2099 2168 2258 2363 2097 2099 2170 2171 2168 2139 2199 2258 2279 2364 2363 2384 2401 Europe (S&P Euro 350) 1474 1475 1339 1388 1475 1547 1399 1339 1376 1390 1388 1377 1388 1475 1463 1501 1547 1564 1603 Japan (Nikkei 225) 18817 19302 15576 16450 19302 18909 17235 15576 16556 16887 16450 17050 18604 19302 19035 19342 18909 19197 19791 Emerging Market and Developing Economies (MSCI) 794 861 834 903 861 958 807 834 879 894 903 908 863 861 909 936 958 978 1015 EM Asia 404 419 407 448 419 474 400 407 431 442 448 444 426 419 443 459 474 484 502 EM Europe 244 295 265 273 295 301 268 265 264 269 273 274 273 295 302 296 301 313 318 EM Europe & Middle East 211 248 225 233 248 252 225 225 227 232 233 232 230 248 253 249 252 259 263 EM Latin America & Caribbean 1830 2341 2269 2381 2341 2611 2038 2269 2359 2402 2381 2608 2330 2341 2516 2600 2611 2601 2761 Exchange Rates (LCU / USD) Advanced Economies Euro Area 0.90 0.90 0.89 0.90 0.93 0.94 0.89 0.89 0.90 0.89 0.89 0.91 0.93 0.95 0.94 0.94 0.94 0.93 0.90 Japan 121.00 108.80 107.96 102.36 109.63 113.63 108.97 105.34 104.09 101.31 101.69 103.72 108.90 116.28 115.03 112.96 112.91 110.02 113.35 Emerging and Developing Economies Brazil 3.33 3.49 3.51 3.25 3.28 3.14 3.54 3.42 3.28 3.21 3.25 3.18 3.33 3.35 3.20 3.10 3.13 3.14 3.09 China 6.29 6.65 6.53 6.67 6.84 6.89 6.53 6.59 6.68 6.65 6.67 6.74 6.85 6.92 6.89 6.87 6.90 6.89 6.89 Egypt 7.70 10.12 8.87 8.87 14.71 17.82 8.86 8.87 8.87 8.87 8.88 9.25 16.34 18.56 18.68 17.01 17.76 18.09 18.12 India 64.14 67.19 66.91 66.94 67.39 66.97 66.93 67.29 67.18 66.91 66.74 66.73 67.60 67.86 68.06 67.01 65.83 64.52 64.08 Russia 61.34 67.06 65.84 64.61 62.95 58.67 65.96 65.01 64.43 64.93 64.48 62.57 64.25 62.03 59.76 58.42 57.83 56.53 56.36 South Africa 12.77 14.71 15.01 14.07 13.92 13.24 15.36 15.05 14.40 13.79 14.01 13.92 13.96 13.88 13.60 13.17 12.95 13.46 13.10 Memo: U.S. nominal effective rate (index) 114.7 119.7 117.5 118.4 122.5 123.4 117.8 118.2 118.9 117.8 118.6 119.7 122.9 124.9 124.8 123.0 122.5 121.6 121.1 1 MRV = Most Recent Value. Commodity Prices 2016 2017 2016 2017 MRV 1 2015 2016 Q2 Q3 Q4 Q1 May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Energy 2 65 55 56 57 64 68 57 59 57 58 58 64 59 68 69 69 65 67 67 Non-energy 2 82 80 81 82 83 86 81 83 82 82 81 81 83 84 85 87 85 83 83 2 Agriculture 89 89 91 91 90 91 91 94 92 91 90 90 90 89 91 91 89 88 88 2 Metals and minerals 68 64 62 64 71 78 61 61 64 65 64 65 73 75 76 79 79 75 72 Memo items: Crude oil, average ($/bbl) 51 43 45 45 49 53 46 48 44 45 45 49 45 53 54 54 51 52 51 Gold ($/toz) 1161 1249 1260 1334 1221 1219 1261 1276 1337 1340 1327 1267 1238 1157 1192 1234 1231 1267 1267 Baltic Dry Index 711 676 613 736 994 938 623 608 707 675 826 870 1080 1031 913 760 1142 1229 994 Source: World Bank, World Bank Commodities Price Data (The Pink Sheet), Bloomberg 1 MRV = Most Recent Value. 2 Indexes, 2010 = 100. Produced by DECPG. Number 347 | May 19, 2017