Europe's rebound seems to have slowed considerably. The manufacturing strength we saw at the beginning of the year has weakened substantially, and instead of manufacturing growth we are seeing 0 to negative growth.
In a very short period of time our ratings have shifted across Europe substantially to the negative, due to the stagnating recovery. Auto sales continue to show negative growth in the region.
Sadly, our readings on the Greek economy remain awful, retail sales fell 30% for the month, an accelerated decline from 2012. Greece must keep getting support from its larger European Union sister states. On the bright side, Europe as a whole is still seeing a more optimistic consumer with Eurozone economic confidence improving again in February.
Japan continues to show a slow, but significant rebound with retail sales climbing 2-3% so far in 2013, however we are still very cautious on the Yen.
India's infrastructure build-out has lost some of its steam though India stands out as the strongest emerging economy among the BRICS. We are seeing some positive signs out of the Chinese consumer with continued spending growth. A turn in China would be especially beneficial to Latin America. Latin America's rebound has already started stagnating due to the weakness in industrial and copper demand. However, on the bright side, Argentina's consumer has started to show signs of life recently with its Consumer Confidence at 47.52, its highest reading in almost a year.
Back home, we are seeing a fragmented recovery in the United States, which continues to be the best economic house on the block. Housing is definitely leading the charge with home prices surging almost 10% and 20% in areas that were harder hit during the crisis, which bodes well for the long-term strength of the overall recovery. Real estate is helping a number of other industries with its rise, including home furnishings, basic materials, industrial equipment and specialized tools. The hotel industry and casinos are starting to see increased demand of 2-3%. General leisure spending in the US is still increasing significantly in a number of areas, including recreational vehicles and sporting goods. On the negative side, we continue to remain skeptical of US Government debt and we would prefer to look towards a higher paying Ohio or California municipal debt and corporate debt from the financial sector.