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Euro-zone GDP growth lost some pace in the second quarter, with a renewed divergence between healthy growth in Germany and stagnation in France. … Euro-zone GDP (Q2 …
14th August 2015
Q2’s Greek GDP figures brought some rare good news. But they relate to an entirely different economy than the one currently being strangled by capital controls. … Greek GDP (Q2, …
13th August 2015
The rebound in Sweden’s headline inflation rate in July might suggest that the Riksbank won’t loosen monetary policy further at its next meeting. But the bigger picture is that inflation is still extremely weak, indicating that more action is needed. … …
Although the renewed fall in French inflation in July largely reflected the decline inthe price of oil, the data nonetheless confirmed that price pressures remain very subdued in the euro-zone’s second-largest economy. … French CPI …
June’s fall in industrial production rounded off a very weak quarter for the sector and strongly suggested that industry will have contributed to a slowdown in quarterly GDP growth in Q2. … Euro-zone Industrial Production …
12th August 2015
While Greece appears finally to be on the verge of receiving a third bailout, the extremely optimisticeconomic & fiscal projections underlying the plan suggest that it might not last for very long. … Greek bailout built on fantasy …
11th August 2015
August’s fall in ZEW investor sentiment suggests that, despite Greece moving closer to a deal with its creditors, investors are increasingly worried about Germany’s recovery. … German ZEW …
Spain is set to remain the fastest growing of the major euro-zone economies for the next few quarters. But while the economy’s fundamentals have improved, the recent impressive growth rates also rest on factors that may soon start to fade. Given that the …
7th August 2015
June’s industrial production from the euro-zone’s major economies suggested that next week’s figures on GDP growth in the currency union will reveal a slowdown from the already modest growth rates seen in Q1 and Q4 last year. … German, French & Spanish …
Hopes that Germany would drive a strong euro-zone recovery have faded as subdued demand for its exports has offset the boost from a weaker euro. This trend is set to continue. And as the consumer recovery is unlikely to gain pace, Germany cannot be relied …
6th August 2015
While the euro-zone economy has continued to weather the ongoing Greek crisis reasonably well, one potentially worrying recent development is the apparent slowdown in the labour market recovery. Not only did unemployment rise for the first time in nine …
5th August 2015
The sharp drop in euro-zone retail sales in June suggests that consumer spending growth slowed in Q2. But July’s final Composite PMI implies that the wider economy maintained a steady pace of expansion at the beginning of Q3. … Euro-zone Retail Sales …
The Italian economy’s tentative return to growth and recent structural reforms are unlikely to feed into a meaningful labour market recovery for some time yet. So frustrations with Mr Renzi’s reformist Government may build further. … Italy’s recovery and …
4th August 2015
The scale of the damage done to the Greek economy by the country’s renewed crisis and imposition of capital controls looks set to be far worse than the provisional plans for a third bailout envisaged and suggests that Greece is still likely to leave the …
3rd August 2015
The peripheral economies continued to make fiscal progress in June. But halfway through the year, most have much more work to do if they are to meet their 2015 budget targets. The economic deterioration in Greece suggests that it is highly unlikely to …
Belgium has started to reform its labour market and improve its competitiveness. But this will take time to bear fruit, and further work will be needed. Accordingly, over the next few years we expect GDP growth to remain sluggish and debt to stay high. … …
31st July 2015
Looking ahead to this week, we think that euro-zone retail sales data for June will reveal a slight slowdown in annual sales growth. On a country level, indicative of their wider economic performances, we suspect that industrial production growth in June …
Euro-zone inflation was well below target in July and renewed rises in unemployment suggest that disinflationary forces remain strong. … Euro-zone Flash CPI (Jul.) & Unemployment …
July’s inflation data confirmed that price pressures in Germany are very subdued, underlining the need for continued and perhaps increased ECB policy support. … German Flash CPI …
30th July 2015
Ireland's economy went like the clappers in Q1, setting the country up for another year as the euro-zone's fastest-growing economy. … Ireland GDP …
The European Commission’s monthly Business and Consumer Survey for July provided some reassurance that the euro-zone economic recovery has retained some momentum in the third quarter. But growth remains generally sluggish and the case for further policy …
The provisional estimate of Swedish Q2 GDP revealed that the economic recovery regained some momentum after the disappointing start to the year. But we doubt that it will prevent the Riksbank from cutting the policy rate further below zero. … Swedish GDP …
While Spain’s economic recovery gathered more pace in the second quarter, the large amount of spare capacity is still sustaining deflationary pressures in the economy. … Spanish GDP (Q2 est.) & HICP …
Euro-zone current account imbalances have narrowed since the financial crisis, and there are good reasons to think that they will not return to pre-crisis levels for some time. But policymakers’ response to remaining imbalances will continue to impart a …
29th July 2015
Portugal’s exports have been amongst the euro-zone’s fastest growing over the last few years. But the country’s external position remains very fragile, leaving it vulnerable to renewed market pressures. … Export success masks Portugal’s external …
28th July 2015
June’s euro-zone monetary data point to a continued economic recovery, although they suggest that growth will not gather much more pace. … Euro-zone Monetary Indicators Monitor …
27th July 2015
July’s rise in German Ifo business sentiment is an encouraging sign that the recovery has continued despite the Greek crisis, although it does not seem to be gaining much pace. … German Ifo Survey …
Greece last week passed the necessary reforms to start negotiations with its creditors on a third bailout. But with the country back in recession, it will struggle to meet the creditors’ fiscal goals. Indeed, euro-zone fiscal data for Q1 last week showed …
24th July 2015
July’s renewed fall in the euro-zone composite PMI offers some early support to our view that the fragile recovery will slow in the second half of the year. … Euro-zone Flash PMIs …
The recent decline in the euro suggests that the markets see the new Greek bailout plan as less favourable for the single currency than a swift Grexit. But the driving force on the euro over the next year or so will be the widening divergence between …
22nd July 2015
Spain’s and Portugal’s recoveries offer some hope for Italy, the periphery’s laggard. But Italy’s exports are still too uncompetitive and its firms too unprofitable to mimic the export and investment-led recoveries seen in Iberia. So Italy’s colossal …
Even if the planned new Greek bailout is quickly and smoothly implemented, the economy looks set to remain in a deep and prolonged recession. … Will the Greek economy ever return to …
21st July 2015
Even if the planned new Greek bailout is quickly and smoothly implemented, the economy looks set to remain in a deep and prolonged recession. … Greek elections won’t ensure passage of …
20th July 2015
The plan for a third Greek bailout has cleared a number of hurdles over the last week, including provisional approval by the Greek and German parliaments. But there are plenty of obstacles yet to be negotiated, including the fiscal targets, the proposed …
17th July 2015
Spanish households will struggle to maintain their recent impressive rates of spending growth. And with households facing years of stagnant wages and high unemployment, opposition to further economic reforms may build. … Spanish households face tougher …
The broader European economy has continued to weather the Greek crisis well, helped by lower oil prices and, in the euro-zone itself, the decline in the euro exchange rate. But these positive forces look likely to fade in the second half of the year and …
16th July 2015
ECB President Mario Draghi maintained a distinctly dovish tone at today’s Governing Council meeting, reiterating the Council’s willingness to step up its QE programme if the economic outlook or financial market conditions worsen. But he was more …
May’s euro-zone goods trade data suggested that the depreciation of the euro over thepast year is still only providing a modest boost to export growth. … Euro-zone Trade …
France’s June inflation data confirmed that price pressures remain very subdued in the euro-zone’s second-largest economy. And the substantial slack in the labour market means that core inflation is likely to remain very weak. … French CPI …
15th July 2015
While yesterday’s announcement of an agreement to provide Greece with a third bailout was greeted with understandable relief, there are still very big hurdles to be cleared before the deal is finalised. … Greek “deal” still has major hurdles to …
14th July 2015
May’s weak industrial production data and the fall in German ZEW investor sentiment in July suggested that the euro-zone’s fragile recovery may be slowing. … Euro-zone Industrial Production (May) & German ZEW …
The fall in Sweden’s headline inflation rate below zero in June vindicated the Riksbank’s decision earlier this month to cut its policy rate further and extend its bond-buying programme. But we think that it still has more work to do. … Swedish Consumer …
Today’s tentative deal for a new Greek bailout clearly reduces the risk of a near-term exit from the single currency. But significant hurdles must be overcome before the deal is finalised. And the negotiations over debt restructuring, which have been put …
13th July 2015
There appears to be a chance that Greece and its creditors will come to a last minute agreement on a new bailout which avoids an imminent Greek departure from the currency union. But there are many hurdles left to negotiate before the deal is finalised. …
10th July 2015
If a Greek exit from the euro-zone resulted in substantial market turmoil, the ECB would probably respond by unleashing its fabled OMTs. This is a potentially powerful tool to limit contagion. But practical constraints on the size of OMTs, as well as …
The rebound in French and Italian industrial production in May came as a welcome relief after Q2’s weak start and the disappointing German data earlier in the week. But across the euro-zone as a whole, industry is still likely to have struggled in Q2. … …
The ECB’s Governing Council may have to playboth villain and hero over the coming week, effectively forcing Greece out of the euro-zone bypulling the plug on Greek banks’ life support and then clearing up the resulting mess. Who’d be acentral banker? … …
9th July 2015
