CyclOpe
The 2009 « indian summer » of world economy
CyclOpeEuropean leadingresearch Instituteon commodity markets
www.cercle-cyclope.com
Professeur Philippe ChalminSeptember 2009
CyclOpe
September 2009
Sun shines again. on equity markets. on commodities. for the real economy. thanks to emerging countries. and US out of recession
Spring or Indian Summer ?
CyclOpe
World equity markets are betting for the end of recession
© Coe-Rexecode
MONDE (39 Places) en dollar
2000 2001 2002 2003 2004 2005 2006 2007 2008 200980
100
120
140
160
180
CyclOpe
And it’s especially true in Shanghai
© Coe-Rexecode
(Shanghai B - 19.12.90=100)
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J2005 2006 2007 2008 2009
50
100
150
200
250
300
350
400
100
150
200
CyclOpe
Same story for commodities
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janvier 1988 = 100
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 200970
500
100
150
200
300
400
CyclOpe
Back to their 2007 level
© Coe-Rexecode
janvier 1988 = 100
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J2005 2006 2007 2008 2009
100
150
200
250
300
350
400
450500
Ensemble hors métaux précieux et pétroleEnsemble y c. métaux précieux et pétrole
CyclOpeThanks to a weakening US dollar
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1 € = ... $
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J2005 2006 2007 2008 2009
1.15
1.20
1.25
1.30
1.35
1.40
1.45
1.50
1.55
1.60
CyclOpeOil back at $ 72.5 a barrel (August average)
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en $ par baril
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 200910
20
30
40
60
80
100
130
15
PETROLE BRUT(Brent 1er terme)
CyclOpeThanks to some discipline by OPEP, Nigerian problems
and… demand
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en $ par baril (Brent 1er terme)
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J2005 2006 2007 2008 2009
30
45
60
75
90
105
120
135150
CyclOpeNon ferrous metals are up too
© Coe-Rexecode
janvier 1988 = 100
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J2005 2006 2007 2008 2009
100
150
200
250
300
CyclOpeLike copper
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en $ par tonne (LME au comptant)
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 20091000
2000
3000
4000
5000
6000
700080009000
CUIVRE
CyclOpeThanks to China and some good news from USA
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en $ par tonne (LME au comptant)
J F MAM J J A S O N D J FMAM J J A S O N D J FMAM J J A S O N D J F MAM J J A S O N D J F MAM J J A S O N D J2005 2006 2007 2008 2009
3000
4000
5000
6000
7000
8000
9000
10000
CyclOpeSteel prices are still low but with a better ratio of capacity
utilisation
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ALL PRODUCTS COMPOSITE PRICE (US $/tonne)
2001 2002 2003 2004 2005 2006 2007 2008 2009200
300
400
500
700
900
1100
CyclOpe
Wheat « suffers » from very good 2009 crop
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Euros par quintal
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 20097
9
11
13
15
17
19
21
23252729
Cours mondial (Chicago)Prix de marché (France)
CyclOpe
But soybeans benefit of Chinese demand
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$ par boisseau (prix au comptant)
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J2005 2006 2007 2008 2009
5
6
7
8
9
10
11
1213141516
CyclOpeAnd sugar was the summer’s star
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cents de $ par livre
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 20095
7
9
11
13
15
17
192123
CyclOpeDry bulk rates have rebounded
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1000 au 4 janvier 1985
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009600
11000
1000
2000
3000
4000
5500
7500
INDICE BFI/BDI
CyclOpeThanks to Chinese demand for Capesize
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1000 au 4 janvier 1985
J F MAM J J A S O N D J FMAM J J A S O N D J FMAM J J A S O N D J F MAM J J A S O N D J F MAM J J A S O N D J2005 2006 2007 2008 2009
500
2000
3500
5000
8000
12000
1000
INDICE BFI/BDI
CyclOpe
. World economy is right now out of recession
. thanks to some emerging countries
. China Q2 + 7.9 %
. India Q2 + 6,1 %
. but not all
. Russia Q2 -10,9 %
CyclOpeChinese industrial production is back on its 10 % a year path :
more than 50 millions tonnes of steel produced in july !
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Variations sur un an en % (mm3)
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 200900
5
10
15
20
25
China : Industrial Production
CyclOpeIn the US, the worst of the real estate crisis seems over : prices are
rising again
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Milliers par an
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009400
700
1000
1300
1600
1900
2300
U.S. : Construction
CyclOpeThe economy loses less jobs
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Milliers
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
0
-900
-600
-300
0
300
600
U.S. : Job creation
Non agricultural sector
CyclOpeAnd the ISM index (52.9 on August 31) is back towards expansion
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%
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 200930
35
40
45
50
55
60
65
U.S. : ISM Manufacturing index
CyclOpeIn Europe, German entrepreneurs are slightly more optimistic
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2000=100
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 200980
85
90
95
100
105
110
Germany : IFO Survey – Business climate
CyclOpeAnd French house holds are more doubt ful
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(soldes des réponses en %)
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
0
-50
-40
-30
-20
-10
0
10
France : consumer confidence
CyclOpe
GDP grorwth in the second quartet go :
. from the best China + 7.9India + 6.1
. to average Germany + 1France + 1Japan + 0.9United States - 1
. bad United King dom - 5.6Italy - 6
. and the worst Russia - 10.9Mexico - 11Estonia - 15.1Latvia - 18.6Lituania - 22.4
CyclOpe
What to expect :
. Spring. Growth in China and India. US gets out of recession in Q3. Oil at $ 70 is a gift for producing countries. The end of the financial crisis ?
. Winter
. Europe : so much unemployment
. Public deficits : who pays ?
. A weak dollar
. Transition economies in crisis
A real Indian summer : world economy is out of recession but recovery will be a long and painful process.
CyclOpe
What to expect :
. Spring. Growth in China and India. US gets out of recession in Q3. Oil at $ 70 is a gift for producing countries. The end of the financial crisis ?
. Winter
. Europe : so much unemployment
. Public deficits : who pays ?
. A weak dollar
. Transition economies in crisis
A real Indian summer : world economy is out of recession but recovery will be a long and painful process.
CyclOpe
What to expect :
. Spring. Growth in China and India. US gets out of recession in Q3. Oil at $ 70 is a gift for producing countries. The end of the financial crisis ?
. Winter
. Europe : so much unemployment
. Public deficits : who pays ?
. A weak dollar
. Transition economies in crisis
A real Indian summer : world economy is out of recession but recovery will be a long and painful process.