Europe Economics Update Services sector will continue to slow The euro-zone’s manufacturing downturn has dragged services growth lower this year. And with both employment and wage growth weakening, services will probably slow a little further next year. 17th September 2019 · 3 mins read
Europe Economics Weekly What more could the ECB do? Even after yesterday’s loosening of monetary policy, the ECB is unlikely to hit its inflation target. The Bank is not yet out of ammunition, but we doubt that further easing would do much good. 13th September 2019 · 5 mins read
Europe Data Response Euro-zone Labour Costs (Q2) The increase in nominal hourly labour cost growth to 2.7% in Q2 masks significant differences between countries and is partly due to a reduction in hours worked, rather than higher wages. We continue... 13th September 2019 · 2 mins read
Europe Economics Update Open-ended QE unlikely to reboot economy With today’s policy decision, Mario Draghi appears to have locked the ECB into QE for several years beyond his time in office. While the move was initially welcomed by financial markets, we doubt that... 12th September 2019 · 3 mins read
Europe Data Response Euro-zone Industrial Production (July) July’s small fall in euro-zone industrial production marked a soft start to Q3 and the surveys suggest that the downturn will continue, encouraging the ECB that it is right to loosen policy later... 12th September 2019 · 2 mins read
Europe Commercial Property Outlook Further falls in yields to sustain capital value growth With the euro-zone slowdown underway, we think that the ECB will loosen monetary policy before the year is out, meaning bond yields are set to remain negative for some time. As a result, yield... 11th September 2019 · 30 mins read
Europe Economics Weekly ECB will need to revise its growth forecasts down The latest economic data suggest that the euro-zone economy will continue to grow slowly in the second half of the year, so the ECB will need to revise its forecasts down next week. We also think that... 6th September 2019 · 5 mins read
Europe Chart Pack Services sector holding up well for now In the face of the downturn in manufacturing, the services sector is still holding up well. Indeed, the business activity index of the services PMI survey suggests that output in the sector is growing... 5th September 2019 · 11 mins read
ECB Watch Bank to cut deposit rate but wait before starting QE2 After policymakers spelt out in July that they were planning to announce more policy stimulus soon, there is sure to be some action when they meet in Frankfurt next Thursday. We think this will... 5th September 2019 · 8 mins read
Europe Data Response Euro-zone Retail Sales (Jul.) & Final PMIs (Aug.) The small upward revision to August’s euro-zone PMI leaves it still pointing to slow GDP growth at the start of H2. And the fall in retail sales in July suggests that consumption started Q3 on weak... 4th September 2019 · 2 mins read
Europe Data Response Euro-zone Flash CPI (Aug.) & Unemployment (Jul.) With headline and core inflation unchanged in August, at 1.0% and 0.9% respectively, and unemployment also unchanged at 7.5% in July, the scene is set for the ECB to loosen policy further. 30th August 2019 · 2 mins read
Europe Data Response EC Business and Consumer Survey (Aug.) August’s small increase in the euro-zone Economic Sentiment Indicator (ESI) doesn’t change the big picture of a bleak outlook for the euro-zone economy, and nor does it alter our view that the ECB... 29th August 2019 · 2 mins read
Energy Update The EU’s new energy policy will be no game-changer The policies of the next European Commission are likely to speed up the EU’s ongoing transition towards a greener energy future. However, its impact will probably not live up to expectations. 29th August 2019 · 3 mins read
Europe Commercial Property Update Prime office yields still obeying Newton’s First Law Plummeting bond yields in 2019 have dramatically improved property valuations, supporting the outlook for property prices. Indeed, we now think that euro-zone prime office yields can extend their... 28th August 2019 · 3 mins read
Europe Economics Weekly ECB preparing for action and perhaps a new target The account of the ECB Governing Council’s July meeting, published this week, confirmed that policymakers are planning to loosen policy in September. Meanwhile, the flash PMIs for August suggested... 23rd August 2019 · 8 mins read
Europe Economics Update ECB account points to rate cuts and target change The account of the Governing Council’s July meeting shows that there was broad support for further policy easing in September and perhaps for a change to the inflation target fairly soon. It leaves us... 22nd August 2019 · 3 mins read
