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July’s euro-zone flash consumer prices figures came as something of a pleasant surprise and provide some support for our view that the ECB may not raise interest rates again over the coming months. … Euro-zone Flash CPI …
30th July 2011
Q2’s GDP figures confirm that Sweden continues to expand at breakneck speed. Although growth will ease in the second half of the year, Sweden will remain one of Europe’s top performers. … Swedish GDP …
Q2’s GDP figures confirm that Sweden continues to expand at breakneck speed. Although growth will ease in the second half of the year, Sweden will remain one of Europe’s top performers. … Swedish GDP (Q2 …
29th July 2011
At August’s press conference, the ECB is likely to keep its options open over the likely near-term path of interest rates. But given the further decline in business and consumer sentiment and growing concerns about Italy and Spain in the markets, we would …
July’s fall in euro-zone economic sentiment adds to the evidence of a broad-based economic slowdown. The decline in the economy-wide Economic Sentiment Indicator (ESI), from 105.1 to 103.2, was sharper than the consensus forecast of a fall to 104.0 and …
The latest ECB Bank lending survey suggests that conditions in the euro-zone banking sector remain far from normal, supporting our view that domestic demand in the region as a whole will struggle to pick up the slack from the flagging external sector. … …
July’s rise in German CPI inflation appears to have been driven by energy prices. Underlying price pressures remain subdued and with the economic recovery already slowing, there is little risk of a sharp rise in core inflation in future. … German Flash …
28th July 2011
The latest rescue package for Greece has reduced the threat of a near-term catastrophe in the eurozone.But it does not address the fundamental problems facing Greece itself and is unlikely to bring an end to the recent signs of contagion to bigger …
27th July 2011
The positive market reaction to the Greek rescue package is not without some justification. After all, following the dithering and disagreement of recent months, it would not have been a shock if Thursday’s meeting had produced precisely nothing. … Back …
26th July 2011
July’s drop in the German Ifo index was another sign that the recovery in the eurozone’s largest and strongest economy is faltering. … German Ifo Survey …
23rd July 2011
The sharp fall in the flash euro-zone PMI in July provides further signs that slowing export growth and the debt crisis is starting to take a heavy toll on the region’s economic recovery both in the core and the periphery. … Euro-zone Flash PMIs …
22nd July 2011
News that a bank levy may be used to help fund Greece’s second rescue package suggests that eurozone policymakers are more concerned about appeasing taxpayers than adopting bold and decisive measures to try and get a grip on the region’s growing debt …
21st July 2011
This week’s crucial summit could provide the last chance for euro-zone policymakers to get a grip on the region’s debt crisis. Anything other than a very decisive response which could be applied not just to Greece but also to Spain and Italy could see the …
20th July 2011
July’s drop in German ZEW investor sentiment highlights fears that the peripheral crisis could soon do some serious damage to the German economy. … German ZEW Survey …
A loss of confidence in the banking system of a euro member country could potentially result in all of that country’s bank liabilities effectively ending up as the liabilities of the ECB. The sheer scale of the sums involved could overwhelm the euro …
19th July 2011
Having pledged to agree on a new rescue package for Greece last week, euro-zone policymakers managed only another vague statement pledging their commitment to “safeguard financial stability” in the region. This would be bad enough if Greece were the only …
The growing recognition that highly indebted economies need more than temporary loans has caused the spotlight to turn on Italy. With EU taxpayers unlikely to stump up enough cash to rescue such a large economy, an Italian crisis might be the trigger for …
14th July 2011
May’s euro-zone industrial production data confirm that the recovery in the sector is far past its peak and suggest that growth in the economy as a whole slowed pretty sharply in the second quarter. … Euro-zone Industrial Production …
The continued failure of European policymakers to agree on a new package to support Greece and the growing signs that larger economies like Spain and Italy are being dragged further into the crisis could mark the beginning of the end for the single …
13th July 2011
Last week’s move by credit rating agency Moody’s to cut Portugal’s rating to below investment grade was a stark reminder that default concerns are not confined to Greece. While the move was fiercely criticised by policymakers for ignoring key differences …
12th July 2011
After hiking interest rates to 1.5% as expected, the ECB took a hard line today on both conventional policy and the prospect of Greek debt restructuring. We think that it will eventually soften on both fronts, but its unsupportive tone presented a clear …
8th July 2011
May’s sharp increase in German industrial production suggested that the euro-zone’s largest economy was still performing very well, but we doubt that this will last. … German Industrial Production …
The slowdown seems to be broadening to the domestic economy, not only in the periphery but also in the core economies. While activity in the industrial and external sectors has slowed further, surveys suggest that the services sector recovery may also be …
7th July 2011
May’s drop in euro-zone retail sales provided further evidence that the intensifying effects of the fiscal squeeze will leave consumers with little chance of taking up the reins as the external and industrial recoveries wane further. … Euro-zone …
6th July 2011
The Swedish Riksbank once again raised interest rates and reiterated that it expects more to come. While we expect further hikes in the short term, we think that the pace of monetary tightening will be a little more gradual than the Bank’s forecasts …
The Swedish Riksbank once again raised interest rates and reiterated that it expects more to come.While we expect further hikes in the short term, we think that the pace of monetary tightening willbe a little more gradual than the Bank’s forecasts …
5th July 2011
The risk of an imminent Greek disaster appears to have eased after the Greek parliament passed the crucial medium-term fiscal bill last week. But European policymakers’ inability to deal with the crisis quickly and decisively is hitting the rest of the …
Growth in remittances from Overseas Filipino Workers (OFW) to the Philippines has slowed since the 2008-09 global crisis. However, we believe that remittances growth is likely to stabilise rather than worsen further in the remainder of 2011. The upshot is …
2nd July 2011
The ECB seems certain to deliver the pre-signalled interest rate hike to 1.5% at its July policy meeting. Accordingly, the key interest will be in what clues, if any, it gives on the likely path of rates in future months and what it makes of the most …
1st July 2011
The Portuguese government’s latest efforts to implement extra fiscal measures to ensure it meets its budget deficit target are encouraging. But even if the Government manages to push through the huge fiscal squeeze planned this year, there are hidden …
June’s euro-zone CPI inflation figures are likely to prompt the ECB to maintain a pretty hawkish tone at next week’s press conference. … Euro-zone Flash CPI & German Unemployment …
The latest data show that euro-zone money and credit growth remain subdued, supporting the view that CPI inflation will fall below the ECB’s target as the boost from energy and food subsides. While a July interest rate hike appears inevitable, we still …
While plans for a Greek debt roll-over and a second bail-out should ease immediate default concerns and funding pressures, Greece is still struggling to rein in its budget deficit, highlighting the challenges which may lie ahead for Ireland and Portugal. …
30th June 2011
The fact that the Greek parliament has passed the Government’s medium-term fiscal plan clearly reduces the chances of a near-term disaster, but the country remains in a precarious position. … Greek disaster averted, for now at …
June’s EC business and consumer survey dealt a further blow to hopes that sustained strong growth in the euro-zone’s core economies might help to ease the crisis in the periphery. … Euro-zone EC Survey …
June’s CPI figures suggest that German inflation remains reasonably well contained. But this is unlikely to stop the ECB from increasing interest rates again next week. … German Flash CPI …
29th June 2011
The French plan for banks to roll over a significant chunk of their maturing Greek government debt could significantly reduce Greece’s near-term funding pressures. But we doubt that the roll-over plan and second bail-out package will prevent Greece from …
Developments last week suggest that the Greek Government will receive the fifth tranche of its initial bail-out package by early July. What’s more, although the finer details on the form of any private sector participation in Greece’s second bail-out …
28th June 2011
June’s rise in the Ifo index defies other recent evidence that Germany’s impressive recovery is slowing. Nonetheless, we still think that GDP growth will slow quite sharply over the remainder of the year. … German Ifo Survey …
25th June 2011
The sharp fall in the flash euro-zone PMI in June provides further signs that the underlying pace of GDP growth is slowing, making it increasingly likely that a bout of strong growth will not solve the euro-zone’s mounting problems. … Euro-zone Flash PMIs …
24th June 2011
June’s sharper than expected fall in the headline German ZEW index brought further signs that the German economic recovery has passed its peak. … German ZEW …
22nd June 2011
The Irish and Portuguese public finances are not in as precarious a position as those of Greece, but we think that there is a strong chance that both economies will eventually have to follow in Greece’s footsteps and try to persuade private sector …
The growing political uncertainty within Greece and fears that European policymakers will not step in and take decisive action to resolve the crisis has pushed the Greek Government closer to the brink. Admittedly, it seems likely that enough financial …
21st June 2011
April’s euro-zone trade data do nothing to alter our view that the external recovery in the region has passed its peak. With domestic demand set to remain weak, we expect GDP growth to slow sharply in the second half of the year. … Euro-zone Trade Balance …
18th June 2011
Crunch time appears to be rapidly approaching for Greece. While an additional bail-out package may stave off near-term disaster, a major debt restructuring seems inevitable at some point and Greece’s future in the currency union is looking ever more …
17th June 2011
May’s small fall in euro-zone CPI inflation is unlikely to prevent the ECB from hiking interest rates again in July. But with Q1’s weak employment figures supporting our view that domestic demand will remain subdued, we continue to think that interest …
As expected, the Swiss National Bank left its interest rate target unchanged at today’s meeting. With the Bank striking a slightly more downbeat tone in its statement and the Swiss franc’s strength keeping inflation subdued, we continue to think that a …
16th June 2011
April’s euro-zone industrial production figures supported the view that the recovery in the wider economy has peaked and that growth may slow quite sharply in Q2 . … Euro-zone Industrial Production …
Our expectation that the euro would fall against the US dollar as the fiscal crisis deepened has not been borne out and we now expect the euro to stay higher for longer. But this unwanted strength will further increase the risks of an eventual euro-zone …
