abare.gov.au - Australian commodities – June quarter . volume 15 . number 2 2008

Economic overview

Prospects for world economic growth

World economic growth is assumed to average 4.0 per cent in both 2008 and 2009, compared with 4.9 per cent in 2007.

While growth in the OECD economies, particularly in the United States, is likely to slow down in the short-term, continued robust performance in the emerging market economies is expected to provide support for world economic growth.

In Australia, economic growth is assumed to be around 2.75 per cent in 2008-09, compared with an estimated 3.5 per cent in 2007-08.

Global economic prospects

World economic growth has slowed

After four years of strong growth at nearly 5 per cent a year, global economic activity has slowed. The slowdown has been most significant in the OECD economies, particularly in the United States, where ongoing weakness in the housing market exacerbated financial market concerns. Among other OECD economies, growth in western Europe has moderated, although activity in Japan has been relatively resilient.

By contrast, economic performance in the emerging market and developing economies continued to be robust, notwithstanding some slowing in economic activity in mid-2008. China and India, which grew at 11.4 per cent and 9.2 per cent respectively in 2007, have been the strongest economic performers. As these countries progressively integrate into the global economy, the growth momentum is being generated by continued strong productivity gains and strengthening public policy frameworks.

Concerns about financial market instability

Conditions in world financial markets have remained strained, with both bank and non-bank channels of credit being affected by the US subprime market problems. The turmoil was initiated by rapidly rising defaults on US mortgages in the course of a correction in the US housing market, which has triggered a decline in the value of mortgage-related assets. The financial market instability has extended beyond the subprime mortgage sector, curtailing financial market liquidity and prompting the re-pricing of risks across a broad range of assets.

In response, central banks in the major OECD economies have provided commercial banks with greater access to short-term funding in order to broaden their lending capacity. While sentiment in financial markets has improved in recent months, significant uncertainty continues as the banking sector worldwide remains vulnerable to any further weakness in financial markets. If it were to occur, another substantial increase in financial market instability could adversely affect the world economic outlook.

Commodity demand and prices have been resilient

Despite slowing global economic growth, world commodity demand, and hence prices, have remained buoyant. The strong performance of commodity markets over the past few years has been the result of both supply and demand factors. On the demand side, a major factor providing strong support for commodity prices is a sharp increase in commodity demand in the emerging market economies, especially for mineral resources. More recently, increased demand for feedstock in biofuel production in many OECD economies, including the United States and those in western Europe, has partly driven a significant increase in prices of many food crops. On the supply side, production responses to higher prices have been lagging, particularly for oil, iron ore and coal. Stock as a share of consumption for many commodities have remained at historical lows.

Higher food and energy prices have led to concerns about inflationary pressures around the world. The increase in inflationary pressures has been more significant in the emerging market economies, reflecting both strong demand growth and the greater weight of energy and food in their consumption baskets. In response, monetary policy has been tightened in China and several South East Asian economies. A number of Asian countries, including Viet Nam and India, have placed temporary restrictions on staple food exports in an attempt to reduce upward pressures on domestic food prices.

Weaker global economic growth in the short-term

One major issue in the current world economic outlook is the duration of the economic slowdown in the United States, the largest economy in the world. In the past, economic slowdowns in the United States have typically been relatively short, followed by vigorous recoveries, as sharp corrections generally help resolve economic and financial imbalances especially in the presence of significant monetary and fiscal stimuli. During the current economic weakness, key determinants of the ability of the US economy to recover quickly are associated with the future course of the housing and financial markets, and theireffects on household spending and business investment.

After peaking in late 2005, the US housing market has undergone a significant correction, with monthly housing starts in early 2008 falling by more than 50 per cent from their recent peak. However, while the US housing market remains vulnerable to a further decline in activity, commercial banks in the United States have been able to secure new funding sources. Thus, although credit has been squeezed, a full-blown credit crunch appears unlikely at this stage.

Reflecting these developments, economic growth in the United States is assumed to remain relatively weak in the next few quarters, before a gradual recovery in 2009. A recovery in economic growth in the United States is expected to provide support for economic activity in other major world economies, including Japan, China and western Europe.

In preparing this set of commodity forecasts, world economic growth is assumed to average around 4.0 per cent in both 2008 and 2009. This compares with growth of 4.9 per cent in 2007.

key macroeconomic assumptions

World

2006

2007

2008

2009

Economic growth

OECD

3.1

2.7

1.5

1.7

United States

2.9

2.2

0.8

1.5

Japan

2.4

2.1

1.3

1.5

Western Europe

2.8

2.6

1.5

– Germany

2.9

2.5

1.4

1.0

– France

2.0

1.9

1.4

1.2

– United Kingdom

2.9

3.1

1.6

– Italy

1.8

1.5

0.3

Korea, Rep. of

5.1

5.0

4.2

4.4

New Zealand

1.5

3.0

2.0

2.1

Developing countries

7.5

7.7

6.6

6.4

– non-OECD Asia

8.9

9.1

7.6

South East Asia a

5.9

6.3

5.3

5.6

China b

11.1

11.4

10.0

9.5

Chinese Taipei

4.9

5.7

3.4

4.1

India

9.7

9.2

7.5

8.0

– Latin America

5.5

5.6

4.4

3.6

Russian Federation

7.4

8.1

6.8

6.3

Ukraine

7.1

7.3

5.6

4.2

Eastern Europe

6.6

5.8

4.4

4.3

World c

5.0

4.9

4.0

Industrial production

OECD

3.2

2.5

1.0

1.5

Inflation

United States

3.2

2.9

3.6

2.4

Interest rates

US prime rate d

8.3

6.6

5.2

5.0

US exchange rates e

Yen/US$

116

118

105

110

Euro/US$

0.79

0.73

0.67

0.69

Australia

2005-06

2006-07

2007-08

2008-09

Economic growth

3.0

3.2

3.5

2.75

Inflation

3.2

2.9

4.0

3.5

Interest rates g

6.6

6.9

7.5

Australian exchange rates

US$/A$

0.75

0.78

0.90

Yen/A$

TWI for A$ h

a Indonesia, Malaysia, the Philippines, Singapore and Thailand. b Excludes Hong Kong. c Weighted using 2007 purchasing-power-parity (PPP) valuation of country GDPs by the IMF. d Commercial bank prime lending rates in the United States. e Average of daily rates. g Large business weighted average variable rate on credit outstanding. h Base: May 1970 = 100. f ABARE assumptions.
Sources:ABARE; ABS; IMF; OECD; RBA.

Stimulus from emerging market economies

While a gradual recovery is assumed to occur in many OECD economies in 2009, a major contribution to world economic growth is likely to come from the emerging market economies, supported by continued solid growth in their domestic demand. In China, economic growth is likely to ease, with rising consumption spending and continued strong fixed asset investment helping to partially offset slowing growth in exports. In India, weaker export demand and higher financing costs are likely to dampen growth in private investment. For other emerging market economies in South East Asia, Latin America and eastern Europe, growth is assumed to moderate in the short-term but continue to be above trend.

Risks to the short-term economic outlook

While world economic growth is assumed to gradually strengthen in the next few quarters, there remain a number of risk factors that could affect global economic prospects.

On the downside, world financial market conditions continue to be a major source of concern. Further substantial losses in the financial sector, as a result of continued weakness in the mortgage market, could lead to a deterioration of the credit market situation and adverse spillover effects on business lending in many parts of the world.

Recent sharp increases in oil and food prices have also raised concerns about the significant upward pressures on inflation in many countries. The concern is particularly acute in emerging market economies where food and energy often represent around 50 per cent of consumption baskets and monetary policy response mechanisms are less well developed. Rising food and energy costs have the potential to rapidly feed into other prices and wages in many emerging market economies, leading to higher domestic interest rates which can adversely affect economic growth.

In particular, consumption and production remain finely balanced in the world oil market, with prices increasing to a recent high of US$139 a barrel (for West Texas Intermediate oil) in mid-2008. With spare productive capacity at historically low levels, unexpected supply shocks or heightened geopolitical tensions could lead to significant oil price spikes and quickly translate into higher inflationary pressures in importing countries.

On the upside, domestic demand growth in the emerging market economies could prove to be more resilient than currently expected.

In particular, the easing of economic growth in China could be more moderate than currently assumed, especially if domestic consumption continues to gather speed and policy measures aimed at slowing investment growth fail to have the intended effect.

In contrast to previous periods of global financial market disruption, the spillovers of the US subprime market problems to the emerging market economies have so far been largely contained. Despite higher borrowing costs and lower equity prices, most emerging market economies have maintained relatively robust economic growth rates. Similarly, trade spillovers from slowing activity in the OECD economies to the emerging market economies have been relatively limited.

Rapid growth in the emerging market economies in recent years has been supported by productivity gains from increased integration into the global economy and improved macroeconomic policy frameworks. In some countries, an improved public sector budgetary situation has the potential to provide greater support for economic activity than in the past, should a more negative external environment emerge. In China, for example, the fiscal consolidation in the past few years has provided the Chinese Government with a greater ability to use fiscal measures to support the economy.

Australia’s major export markets

US economic growth to ease

Following a mild slowdown in 2007, economic activity in the United States weakened further in early 2008, growing at an annual rate of 0.6 per cent in the March quarter 2008. Net exports provided a boost to growth, although residential investment continued to exert a significant drag on the economy.

Partial indicators released in mid-2008 have provided signals of a marked weakening in economic growth, largely reflecting the effect of recent financial market instability and problems in the housing market. Housing market indicators have been weak and consumer and business sentiment, and manufacturing activity, are also declining.
In the short-term, continued difficulties in the mortgage market are expected to extend the decline in residential investment, while house price declines are likely to dampen household consumption spending. In contrast, exports are expected to grow strongly, benefiting from the decline in the value of the US dollar.

Reflecting these considerations, it is assumed that the US economy will remain relatively weak in the remainder of 2008, before a gradual recovery in 2009. Compared with the 2001 recession, economic recovery in 2009 is assumed to be more gradual, reflecting the time required for household and financial institutions to rebuild their balance sheets.

On an annual basis, growth in the US economy is assumed to slow to 0.8 per cent in 2008, before being expected to rise modestly to 1.5 per cent in 2009.

Risks around these growth assumptions are weighted to the downside, particularly for 2009. Continued weakness in financial and housing markets could lead to lower business investment and consumer spending. Nevertheless, concerns have been partially alleviated by vigorous policy responses, particularly those providing liquidity to financial markets.

Given this economic outlook, monetary policy in the United States is expected to remain accommodative in the short-term. The federal funds rate was at 2.0 per cent in mid-2008, compared with 5.25 per cent in the same period a year earlier. With core inflation still elevated and prospects for continued high and volatile energy and food prices, there remain concerns about an increase in inflationary pressures. However, the inflation risk should recede as spare capacity emerges and the labour market softens.

Economic growth in China to remain robust

The pace of economic growth in China moderated slightly in early 2008. Real gross domestic product expanded at an estimated year on year rate of 10.6 per cent in the first quarter of 2008, compared with 11.2 per cent in the previous quarter. Major contributors to economic growth in the March quarter were higher investment expenditure, consumption spending and net exports.

The strength of domestic demand and rising food and energy prices have contributed to a buildup of inflationary pressures in China. Inflation rose to a year on year rate of 7.7 per cent in May 2008. In response, the central bank has maintained a tight monetary policy, further raising the reserve requirements for bank lending in the first half of 2008. Domestic interest rates, however, have been left unchanged since late 2007.

Growth prospects in China remain dependent on the size of financial and trade spillovers from the slowdown in the OECD economies, especially the United States. Although foreign direct investment in China could slow down in the short-term as a result of the tightening of global credit conditions, the direct effect on China’s economic performance is expected to be limited.

Growth in China’s exports, particularly to the United States and western Europe, is likely to be adversely affected. However, the strength of domestic demand in China is expected to provide support to the overall economic growth. Against this backdrop, economic growth in China is assumed to be 10.0 per cent in 2008, before easing to 9.5 per cent in 2009.

Risks to China’s economic outlook remain broadly balanced at this stage. On the downside, a sharper than anticipated slowdown in the OECD economies has the potential to adversely affect China’s growth prospects, dampening investment spending and exports. On the upside, domestic demand could be more resilient to monetary tightening measures and weaker external demand. It is also likely that China will provide fiscal stimulus to support economic activity, should economic growth decline significantly.

Japan’s economic growth prospects

Japan’s economic expansion continued in early 2008, despite a slowdown in global economic growth. Gross domestic product, in real terms, grew at an annualised rate of 3.3 per cent in the March quarter 2008. Export performance has continued to be robust, supported by demand from other Asian economies and western Europe. After a contraction in the second half of 2007, residential investment rebounded in early 2008. Higher household consumption spending has partly offset a decline in business investment expenditure.

Partial indicators released recently indicate that the growth momentum could slow in the short-term. For example, the Bank of Japan’s latest Tankan report suggests business confidence has declined, with companies planning to cut capital investment spending. Consumer confidence has also fallen and there are indications export growth could ease in the short-term.

Weaker export growth as a result of a global economic slowdown is a key risk to the economic outlook for Japan. Emerging market economies in Asia, including China and many South East Asian countries, have become a destination for around one half of Japan’s exports, while the importance of the United States and the euro area has declined. Therefore, Japan’s export performance prospects are linked to the economic performance in the emerging market economies in Asia.

Lower domestic demand than currently assumed is another source of downside risk to Japan’s economic outlook. Higher food and energy prices and slow wage growth could dampen household consumption, and business investment could moderate further if the global credit conditions were to tighten. However, the exposure of Japan’s financial sector to global financial market difficulties is relatively low as it has limited direct involvement in US subprime mortgage related assets.

Economic growth in Japan is assumed to be around 1.3 per cent in 2008 and 1.5 per cent in 2009. This compares with growth of 2.1 per cent in 2007.

Growth prospects for non-OECD Asia

Growth in non-OECD Asia (excluding Japan and the Republic of Korea) remained relatively robust in late 2007 and into 2008, although the pace of expansion has eased in some regional economies. In India, for example, economic growth slowed to 8.4 per cent in year on year terms in the December quarter 2007, down from 8.9 per cent in the September quarter and 9.3 per cent in the June quarter. Tighter monetary conditions in India appear to have dampened consumer spending and hence industrial output in recent months.

Relatively strong domestic demand, led by growth in consumption, is supporting economic activity in Indonesia, Malaysia, the Philippines and Singapore. While export growth has remained relatively strong in the Republic of Korea and Thailand, high energy prices are weighing on consumer demand in these economies.

Inflationary pressures have begun to emerge in many South East Asian economies, including Indonesia, Thailand and the Philippines. In India, monetary tightening in early 2007 led to an easing of inflationary pressures later in the year. However, inflation has started to pickup once again since early 2008 owing to higher commodity prices. There is rising concern that sustained food price increases could spillover into wages and spark a broader pickup in inflation in non-OECD Asia.

Trade spillovers from the slowdown in the OECD economies, combined with inflationary pressures, are the key downside risks to growth prospects of this region. On the upside, rising consumption and continuing strong investment in most countries are likely to help balance the effect of slower export growth, with economic growth in China expected to continue providing support to export performance in many regional economies.

For non-OECD Asia as a whole, economic growth is assumed to average around 7.6 per cent in both 2008 and 2009, compared with growth of 9.1 per cent in 2007.

Economic prospects in Australia

After growing strongly in the first three quarters of 2007, economic activity in Australia eased at the end of the year and in early 2008. Real gross domestic product, seasonally adjusted, rose by 0.6 per cent in the March quarter 2008.This compares with growth of 1.3 per cent in the same period a year earlier. While the unemployment rate has edged up in recent months, it remains at historically low levels.

Australia’s current account imbalance widened in early 2008, with a seasonally adjusted deficit of $19.5 billion recorded in the March quarter 2008. This compares with a deficit of $18.7 billion in the December quarter 2008. The trade account recorded a seasonally adjusted deficit of around $8.0 billion in the March quarter 2008, compared with a deficit of $6.6 billion in the December quarter 2007.

The Australian economy is expected to continue to benefit from higher commodity export earnings. While a slowdown in global economic growth could dampen demand for mineral resources, a continued tight balance between consumption and production in many markets is expected to provide support for world prices.

Under the assumption of a return to average seasonal conditions, the rural sector is forecast to recover in 2008-09. However, the actual timing and distribution of rainfall will have an important effect on the prospects for rural production and exports. For 2008-09 as a whole, the volume of farm production is forecast to increase by around 10.0 per cent. The volume of crop production is forecast to expand by 21.7 per cent in 2008-09, while livestock production is forecast to fall slightly by 1.6 per cent.

Economic growth in Australia is assumed to average around 2.75 per cent in 2008-09, following estimated growth of 3.5 per cent in 2007-08. Household consumption and business investment are likely to be the main contributors to economic growth in 2008-09. The recovery in farm production is forecast to contribute around 0.5 per cent to economic growth in 2008-09.

Inflation

Productive capacity constraints, combined with strong domestic demand growth, have contributed to an increase in Australia’s inflation rate. The consumer price index rose by 1.3 per cent in the March quarter 2008, compared with an increase of 0.9 per cent in the December quarter 2007. On an annual basis, Australia’s consumer price index was 4.2 per cent higher year on year in the March quarter 2008. Contributing most to the increase in the March quarter were rises in food, fuel and housing costs.

Looking forward, inflationary pressures in Australia are likely to ease gradually, partly reflecting the effects of higher domestic interest rates and a tighter fiscal policy stance on economic activity. For 2008-09 as a whole, Australia’s inflation rate is assumed to average around 3.5 per cent. This compares with an estimated 4.0 per cent in 2007-08.

Exchange rate

Over the past year, the Australian dollar has appreciated markedly both against the US dollar and on a trade weighted basis. The Australian dollar was trading around US94c and TWI 72 in mid-June 2008, compared with US84c and TWI 68 in mid-June 2007.

A key factor contributing to the recent appreciation of the Australian dollar is the weakness of the US dollar against most other major currencies. For example, the US dollar was trading around 0.64 euros in mid-June 2008. This compares with 0.75 euros in the same period a year earlier. Recent movements in the US dollar have been affected by the continued uneasiness in financial markets, as well as weakening US growth prospects.

Another factor continuing to provide strong support for the Australian exchange rate is the significant rise in Australia’s terms of trade. In the December quarter 2007, for example, Australia’s terms of trade were around 23 per cent higher compared with the same period in 2004. Significant support for a stronger Australian dollar, especially against the US dollar, has also come from a widening interest rate differential between Australia and the United States. Interest rates have been increasing in Australia in recent months, while monetary policy in the United States has been easing.

Looking forward, the previously mentioned factors are expected to continue to affect movements in the Australian exchange rate in the short-term. Movements in Australian interest rates depend on the outlook for economic growth and inflation. Given the outlook for continued inflationary pressures in the domestic economy, Australian interest rates are likely to remain relatively high in the short-term. In preparing this set of commodity forecasts, the prime lending rates in Australia are assumed to average around 7.5 per cent in 2008-09, similar to the average in 2007-08.

Reflecting the assumption of a gradual economic recovery in the United States, there is a distinct possibility the US dollar will remain relatively weak in the short-term. The Australian dollar is consequently assumed to remain relatively strong, averaging around US90c and TWI 70 in both 2007-08 and 2008-09.

There is considerable uncertainty surrounding the short-term outlook for the Australian dollar, as movements in the Australian exchange rate can be significantly influenced by changes in financial market sentiment. Given the volatility of movements in the Australian dollar, it remains important for primary producers and exporters to manage the risks associated with fluctuations in the Australian exchange rate.

Commodity export prices up sharply in 2008-09

The index of unit export returns for Australian commodities, in aggregate, is forecast to rise considerably in 2008-09, following a rise of 8 per cent in 2007-08. This is mainly the result of significantly higher energy and mineral prices.

For farm commodities, the index of unit export returns is forecast to be largely unchanged in 2008-09, after increasing by 9 per cent in 2007-08. The effects of forecast lower world indicator prices for wheat, sugar, rice, wool and dairy products are expected to offset forecast higher world cotton, coarse grain and oilseed prices.

However, unit export returns for Australian mineral and energy commodities are forecast to rise by around 37 per cent in 2008-09, following a rise of 8 per cent in 2007-08. The increase in 2008-09 is largely a reflection of higher forecast prices for crude oil, coking coal, thermal coal, aluminium, gold and iron ore.

Unit returns for energy exports are forecast to rise by 69 per cent in 2008-09, compared with an increase of 22 per cent in 2007-08. Unit export returns for metals and other minerals are forecast to increase by 14 per cent in 2008-09, compared with a reduction of almost 1 per cent in 2007-08.

Record commodity export earnings in sight

Earnings from Australia’s commodity exports are forecast to be $212.3 billion in 2008-09, compared with an estimated $151.4 billion in 2007-08 (a rise of 40 per cent). The forecast increase in the value of commodity exports reflects considerably higher earnings from energy exports.

For agricultural commodities, export earnings are forecast to be $30.2 billion in 2008-09, an increase of 12 per cent from $27.0 billion in 2007-08, reflecting higher earnings from wheat, barley, cotton lint and seed, sugar, wine, pulses, canola, and sorghum. For forest and fisheries products, export earnings are forecast to be around $4.1 billion in 2008-09, 5 per cent higher than in 2007-08.

The value of Australia’s minerals and energy exports is forecast to be nearly 50 per cent higher, at $177.9 billion in 2008-09, compared with an estimated $120.5 billion in 2007-08. For energy commodities, export earnings are forecast to increase by 81 per cent, from $48.8 billion in 2007-08 to $88.3 billion in 2008-09. For metals and other minerals, export earnings are forecast to rise by 25 per cent to $89.6 billion in 2008-09.

ABARE’s commodity forecasts: some key issues

ABARE presents its forecasts of production, consumption, prices and exports of specific commodities as point estimates. These point forecasts are based on an economic assessment of data and information from a variety of sources available at the time the forecasts are made, supported by discussions with industry experts, the use of quantitative analytical tools, and professional judgement. The nature of forecasts made by ABARE (and other organisations) is such that actual outcomes are sometimes different from the initial point forecasts.

A key reason for these differences is that ABARE is often required to make assumptions about factors that have the potential to affect actual outcomes. As more information becomes available over time, earlier assumptions are updated and forecasts are revised. ABARE forecasts are therefore conditional on the information available at the time they were made.

Also important is that the differences between forecasts and actual outcomes reflect the impacts of factors that are ‘unforeseeable’. These can include unanticipated policy changes, unpredictable macroeconomic developments, changing weather conditions (especially for agricultural commodities) and unplanned production or supply disruptions (particularly for energy and minerals commodities).

Changes in seasonal weather conditions over the forecast period are a major risk in forecasting agricultural production and hence agricultural exports and prices. In forecasting the major non-irrigated crops in Australia, ABARE takes into account information on the seasonal outlook released by the Australian Government Bureau of Meteorology and yield forecasts provided by the Agricultural Production Systems Research Unit, of the Queensland Department of Primary Industries and Fisheries. For agricultural production in the United States, a major agricultural producer, ABARE utilises (among other information) the estimates and forecasts released by the US Department of Agriculture (USDA). Any variation in those estimates/forecasts from the actual outcomes will also affect ABARE’s assessment of variables ranging from commodity production to prices.

Similarly, a range of risks applies to ABARE’s forecasts of energy and minerals commodities. In recent times it has become increasingly difficult to accurately forecast movements in energy and minerals prices on world markets. In addition to the fundamental factors important to changes in consumption and production, a number of other factors have emerged as important determinants of movements in world prices. These factors include geopolitical issues and their effects on supply potential; unforeseen supply disruptions, including those related to insurgent action against supply infrastructure or unexpected shutdowns of production facilities; and investment and speculative trading on energy and minerals markets. It is not possible to predict these factors with any level of confidence.

An example of the effect of unforeseeable events is the incidence of Hurricane Katrina in August 2005. As well as devastating the United States city of New Orleans, Hurricane Katrina damaged infrastructure in the region, including grain export handling facilities and oil production and petroleum refining operations. In early September 2005, the loss of crude oil production in the Gulf of Mexico region as a result of Hurricane Katrina was around 1.4 million barrels a day. Based on the estimates released by the USDA at that time, the initial effect of Hurricane Katrina was to delay US coarse grains exports of 1.36 million tonnes to the following season. Both of these impacts resulted in higher than previously forecast prices for these commodities.

The occurrence and effect of events such as hurricanes, political upheavals and drought cannot be predicted and incorporated into commodity forecasts before the event. While ABARE forecasts attempt to balance a range of upside and downside risks, some of the key judgments relating to forecasts will inevitably be different from the actual outcomes.

Despite being largely unpredictable, information about the potential risks to the point forecasts that some of these factors pose will be useful for decision-makers in the commodity sector. For this reason, ABARE incorporates discussions on the risk factors in the associated notes presented in Australian commodities. Decision-makers are encouraged to read the report in full in order to gain a comprehensive understanding of the context of ABARE’s commodity forecasts.