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Macroeconomic Chartbook

• For the last 12 months, the all-item index was unchanged before seasonal adjustment. • Over the last 12 months the food index rose 3.0 percent and the index for all items (excluding food and energy) increased 1.7 percent. These increases were offset by an 18.8-percent decline in the energy index. • Indexes that have risen over the past 12 months include shelter, medical care, and new vehicles. Indexes that have declined include airline fares, used cars and trucks, and apparel.

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China at the Tipping Point

• The China Chain Store & Franchise Association (CCFA) estimates that around 300 new malls are opened in China each year and that the total number of malls will reach 4,000 by 2015. • Nine out of the top Ten newly completed malls are in China. • Malls account for the majority of China’s commercial property supplies: 68.3% (Tier 1 cities) and 61.6% (Tier 2 cities).

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Macroeconomic Chartbook

• Real GDP rose at a revised annual rate of 2.2% in the fourth quarter, down from 5.0% in the third quarter and below the “advance” estimate of 2.6% initially reported for the final period • The 0.4 percentage-point difference between the two figures reflected a downward revision to private inventory investments and an upward revision to imports that were partially offset by upward revisions to nonresidential fixed investment and to state and local government spending • Full-year real GDP growth was 2.4%, up from 2.2% in 2013, reflecting higher consumer spending, nonresidential fixed investments, exports and state and local government spending, offset by lower federal spending

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Consumer Indicators Chartbook

For 2014 total housing starts reached 1.05 million, significantly below the 1.5 million average of the past 50 years • Multi-family down 1% but sector strong on rising rental demand • The National Association of Realtors forecast is for single-family housing starts to rise by 25% to 30% t in 2015 as construction loans become more accessible. Multi-family housing starts will rise by additional 15% given the very low apartment vacancy rates. That translates into a good recovery year for homebuilders in 2015

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US Holiday 2014 Recap

Consumer & Retailer Behavior • Driven by early and heavy promotional activity, some piggybacking on Back-To-School sales and continuing post-Christmas • Extended store hours and Click & Collect were popular promotional strategies employed by retailers in the final days leading up to Christmas • Consumer shopping behavior has evolved to reflect the savvy shopping habits of a value-driven mindset • The winners are retailers who respond to the consumers’ bottom line, offering continued discounts, price comparison and coupons

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New and Emerging Technologies Retailers Will Use to Market Their Brands and Products

Retailers – Walmart: Biggest day of online orders on Cyber Monday; 500 new promotions a day through Friday – Target: 100,000 items on sale all week – Amazon: Cyber Monday spreading out to Cyber Week • Cyber Monday – e-commerce sales +15.6% YoY (Channel Advisor) – Online sales +8.5% YoY (IBM) – Average order value $124.21, down 3.5% YoY – Mobile sales +27.6% YoY (IBM) – Mobile sales = 22 % of total Cyber Monday online sales, +27.6 % YoY

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