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                    Daily Brief
    Economics and Financial Market Commentary
               November 12, 2010
                            Mick Riordan, Cristina Savescu,
                               Eung Ju Kim, Allen Denis,
                           Annette DeKleine, Augusto Clavijo
You’ll find recent issues of this Daily and lots of other current analysis and high-frequency data at
          our intranet website: http://GEM or for external users: www.worldbank.org/gem

. U.S. consumer sentiment improves in November. The University of
Michigan/Reuters index of consumer sentiment rose 2.4% in November to a
reading of 69.3, the highest reading since June. This is the first time in three
months that consumer confidence has increased, although the level of the index
is still well below the long term average of 88.9. The October job report, which
showed payrolls increasing by 151,000 (the first increase in four months) is
positively affecting households’ opinion of the economy in the short term.
Whether this boost in confidence will translate into increased spending by U.S.
households, particularly in the upcoming holiday season, will be critical for
continued improvement in the economy.

Europe’s growth cools in the third quarter. The Euro Area’s GDP growth
cooled in the third quarter to 0.4% (q/q) compared to 1% growth in the second
quarter. At the same time industrial production for the region decreased 0.9%
(m/m) in September, posting the largest monthly drop in 18 months. Germany’s
economy grew 0.7% (q/q), in line with expectations as exports continued to
provide strong impetus to the manufacturing sector. Real GDP expansion in
France slowed to 0.4% (from 0.7% q/q) and to 0.2% (from 0.5%) in Italy [see ].
The Greek and Spanish economies posted contractions in the third quarter,
outlining the differences between the recovery in countries within the Euro Area.


Among emerging markets… In Central and Eastern Europe and the CIS,
Russia’s real GDP grew 2.7% (y/y) in the third quarter, down from a 5.2% jump
recorded in Q2-2010.

Bulgaria’s economy expanded 0.3% (q/q) in the third quarter, slightly slower than
the 0.5% growth seen in the second quarter.

The Romanian economy contracted by 0.7% (q/q) in the third quarter, as the
cost-cutting plan in July that enacted a 5 percent hike in the VAT (among other
measures) dampened domestic demand.
In Latin America and the Caribbean, Brazil’s retail sales rose 0.4% (m/m) in
volume terms over September, a 11.8% increase from 12months ago.
In South Asia, India’s industrial output rose 4.4% (m/m) in September, down from
6.9% growth seen in August.
Recent issues and other current analysis is also available on the Prospects blog
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DECPG Daily is an informal briefing for Bank staff whose responsibilities require that they stay
abreast of changes in global markets. The views expressed here do not reflect those of the World
Bank Group. Feedback, and requests to be added to or dropped from the distribution list, may be
sent to eriordan@worldbank.org.