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This section presents economic and financial news and statistics for the leading developed countries. Worries about petrol prices, instability in Iraq and the prospect of higher interest rates may be taking their toll on the mood of American consumers. Despite recent improvements in economic growth and employment, consumer confidence was little changed in May, according to the Conference Board. Sales of existing American homes rose by 2.5% to near-record highs in April. Euro-area economic growth continues to be sluggish. According to EuroCOIN, a monthly economic indicator published by Britain's Centre for Economic Policy Research, the euro area's economy saw hardly any change in April from its weak growth rate in March. Higher oil prices caused German consumer-price inflation to rise in the year to May to 2.1%, its highest rate in over two years. France's economy, by contrast, is showing signs of optimism: consumer spending rose by 1.5% in April. The OECD says that there is much that the Netherlands can do to make its economy more efficient.

This article looks at the latest economic and financial indicators. As expected, America's Federal Reserve left interest rates unchanged at 1.0%. Britain's central bank also met expectations, but by raising its base rate a quarter point, to 4.25%. America's ISM index of manufacturing activity fell slightly in April to 62.4 while the ISM service-industry index rose to 68.4 in April from 65.8 in March, better than expected. Producer prices in the euro area rose by 0.4% in the year to March, down from a rate of 2.4% a year earlier. Oil prices rose to nearly $40 a barrel, the highest level in more than 13 years. Coverage of more statistics on economic forecasts of money and interest rates, market indicies and trade, exchange rates and budgets.

This section presents economic and financial news briefs and statistics on the fifteen leading world economies. Worries about job prospects caused the Conference Board's index of American consumer confidence to fall sharply in February, to its lowest level since October. Business confidence fell across Europe in February. On the other hand, the stronger euro is helping to curb the cost of imports, and hence inflation. Spain's GDP rose by a higher than expected 0.7% in the fourth quarter of 2003; output was 2.7% up on a year earlier. Canada's inflation rate fell to 1.2% in January, from 2.0% in December, largely because an electricity rebate in December 2002 (which distorted the December 2003 rate) dropped out of the 12-month price change. The Swiss economy has suffered in the past two years as businesses have cut investment and run down inventories in response to the world downturn. Exports have also been hampered by the appreciation in the Swiss franc.

This section presents economic updates and statistical information on output, demand and jobs; prices and wages; and unemployment for 15 countries and the Euro area. America's economy showed several signs of strength in November. Industrial production rose by 0.9%, a faster-than-expected rate. Housing starts also grew by more than expected. Retail sales rose by 0.9%.Consumer confidence fell to 89.6 in December from 93.7 in November. Inflation slowed sharply in America, but rose in the euro area. According to EuroCOIN, an economic indicator published by Britain's Centre for Economic Policy Research, euro-area economic growth inched up in November after stagnating in September and October.In the euro area, the joblessness rate has crept lower over the past decade, from 10.8% in 1994 to 8.8% in 2003, yet it remains higher than in most rich countries.

The author claims that Asian central banks have prevented the U.S. dollar from falling even more dramatically than it has in recent months, but warns that Asian banks may seek to diversify their holdings. The dollar did pop up briefly on December 9th, after the Bank of Japan apparently intervened to stop the yen rising, but the Japanese central bank has already spent some $168 billion on dollars this year, and the yen has climbed by 11% against the American currency. Perhaps the yen would have risen by more had the Bank of Japan spent less: this week the euro was up by 42% from its lowest point against the dollar and sterling was at its highest since being ejected from Europe's exchange-rate mechanism in 1992. The dollar has been weakening even as America's economy has been picking up sharply. The health of the economy may now be part of the dollar's problem. Americans save so little that their spending must be financed by foreigners, which is why the country's current-account deficit has been rising so swiftly, to half a trillion dollars or so. Until recently, this foreign investment was largely of a private nature; however, as concerns about the scale of the deficit have mounted, private flows have dried up somewhat and central banks have been topping up the stream. Jim O'Neill, Goldman's chief economist, thinks that central banks will increasingly wake up to the benefits of diversification.

The section presents news briefs and charted data showing economic and financial indicators for a list of 15 developed countries, including the United States, Japan, Australia, Canada, the Euro area and individual European countries, plus closer looks at the Economist's poll of economic forecasters, and trade volumes. Consumer confidence in America suffered a surprise blow. American economic growth in the second quarter was revised up for the second time. The European Commission's euro-area economic-sentiment index rose in September to its highest level this year. Australia's industrial production grew by 1.3% in the year to the second quarter. Britain's GDP grew by twice as much as originally estimated in the second quarter.

The European Central Bank is not one to cave in to calls for lower interest rates from market commentators and politicians. But what if those calls are obviously right? In March 2003 the bank disappointed many by cutting rates by a mere quarter-point to 2.5%. The ECB next meets on May 8, 2003 against an increasingly gloomy outlook for growth in the euro zone. Yet recent comments from ECB officials suggest that the bank is in no rush to cut again. The euro area's economy grew by only 0.7% at an annual rate in the fourth quarter of 2002, and has begun this year sluggishly. Over the past couple of years, while Germany's economy has been stuck in first gear, France's has motored along nicely. Now the French engine is sputtering too.

This article reports that Europe's exchange-rate mechanism (ERM) has not collapsed since sterling's suspension and it's business is as usual for 11 of the European Community's 12 members. France's experience under lines the ERM'S fragility. Though pressure on the franc has eased, there may well be more to come. There is no doubt that lower German interest rates would ease such pressures on the ERM and might lure sterling back in. Few German economists, however, expect the Bundesbank to cut rates soon, despite evidence that the German economy is slowing. For the moment the Bundesbank is preoccupied with soaking up D-marks that have flooded in billions into the market because of intervention.