Europe Economics Update Will the equity rally boost household spending? We doubt that the recent equity market rally, combined with the ongoing downward trend in CPI inflation, will prompt a sustained recovery in euro-zone household spending. Indeed, in the periphery... 21st May 2013 · 1 min read
Europe Economics Update French wealth tax adds to fears for economy The news that some wealthy French households were taxed over 100% of their income last year has added to criticism of President François Hollande’s policies. But the bigger point is that rising... 20th May 2013 · 1 min read
Europe Economics Update Is monetary policy too loose for Germany? This Update addresses the question of whether monetary policy is now too loose for Germany and, if so, what can be done about it? While there are various policies that could be adopted at the national... 16th May 2013 · 1 min read
Europe Economics Update Has Greece reached a turning point? The Q1 estimate of Greek GDP and the credit rating upgrade by Fitch suggests that the economy may finally be turning a corner. But we still think that the economic forecasts underpinning the rescue... 15th May 2013 · 1 min read
Europe Economics Update What negative rates would mean for euro-zone neighbours As a result of ultra-loose monetary policy in major economies, central banks in smaller countries such as Switzerland, Sweden, Norway and Denmark are struggling to deal with both rising private debt... 14th May 2013 · 1 min read
Europe Economics Update Germany's role in a solution to the euro-zone debt crisis This Update summarises views expressed by Capital Economics’ Jennifer McKeown in a panel discussion at the Euromoney “Germany Conference” in Berlin on 24th and 25th April. 13th May 2013 · 1 min read
Europe Economics Update German election campaign offers no hope of fiscal boost The growing likelihood of a grand coalition government after September’s election suggests that Germany’s tough stance on the euro-zone periphery might soften somewhat. However, none of the main... 9th May 2013 · 1 min read
Europe Economics Update Norges Bank will be forced into a cut by end-2013 The Norges Bank left interest rates unchanged today as concerns about rising household debt once again outweighed the need to weaken the currency and boost inflation. But our expectation for the euro... 8th May 2013 · 1 min read
Europe Economics Update Can the ECB make negative rates work? The ECB appears to have concluded that it can limit the adverse side-effects of imposing negative interest rates on commercial banks’ deposits. But even if this is the case, negative rates are not... 8th May 2013 · 1 min read
Nordic & Swiss Economics Update Norges Bank will be forced into a cut by end-2013 The Norges Bank left interest rates unchanged today as concerns about rising household debt once again outweighed the need to weaken the currency and boost inflation. But our expectation for the euro... 8th May 2013 · 1 min read
Europe Economics Update Is it true that Germany can’t afford bail-outs? A recent ECB survey suggested that German households are much less wealthy than those in the eurozone’s south and periphery. There are several reasons why this is untrue. But unfavourable coverage in... 7th May 2013 · 1 min read
Europe Economics Update ECB rate cut will be of limited use The ECB’s widely anticipated interest rate cut should provide troubled banks in the region’s periphery with some much-needed support. But it will not be enough to drag the euro-zone out of recession... 2nd May 2013 · 1 min read
Europe Economics Update Falling oil prices highlight Norway’s long-term problems Due to Norway’s much-lauded fiscal rules, the recent fall in oil prices will have little impact on the economy’s bright near-term outlook. Nonetheless, Norway’s growing dependence on hydrocarbons... 2nd May 2013 · 1 min read
Nordic & Swiss Economics Update Falling oil prices highlight Norway’s long-term problems Due to Norway’s much-lauded fiscal rules, the recent fall in oil prices will have little impact on the economy’s bright near-term outlook. Nonetheless, Norway’s growing dependence on hydrocarbons... 2nd May 2013 · 1 min read
Europe Economics Update Euro-zone Fiscal Monitor (Apr.) In 2012, most of the peripheral economies made decent inroads into their budget deficits. But the fiscal consolidation process is far from over. 30th April 2013 · 1 min read
Europe Economics Update Italy: New government, same challenges The formation of a grand coalition government in Italy is clearly a step forward, but we doubt that this marks a period of lasting political stability. In addition, despite calls from Prime Minister... 29th April 2013 · 1 min read