We do not think the Fed’s 50bp rate cut or the latest euro-zone HICP inflation breakdown will put the ECB off its plans for gradual policy easing. Meanwhile, France looks close to having a new government but is a long way from solving its public debt problems. Next week, we expect to learn that headline inflation fell sharply in France and Spain in September, but underlying inflation will have remained elevated.
Note: We’ll be discussing key takeaways from our Europe Economic Outlook, including the scope of Germany’s downturn, in a Drop-In on Tuesday, 24th September. Register here for the 20-minute online briefing.
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