Europe Data Response German Industrial Production (April) April’s increase in industrial output reversed only a fraction of the decline in March and shows that high energy prices, the Ukraine war and ongoing supply shortages are still having a major impact... 8th June 2022 · 2 mins read
Europe Chart Pack Tailwinds fading, headwinds building With some important exceptions, including the German manufacturing sector, economic activity seems to have held up a little better than we had feared so far in Q2. We don’t think this will last. The... 7th June 2022 · 10 mins read
Europe Economics Looming ECB rate hikes give SNB plenty to ponder We forecast the SNB to largely shadow ECB rate hikes over the next 18 months or so, albeit allowing the interest rate differential with the euro-zone to widen from 25bps at present to 50bps by end... 7th June 2022 · 4 mins read
ECB Watch ECB to confirm July take-off Members of the ECB Governing Council are unanimous in believing that interest rates should be raised but divided over how quickly. We expect them to confirm next Thursday that the Bank will end net... 1st June 2022 · 7 mins read
Europe Economics Weekly Stagflation taking hold The slump in German retail sales in April is a reminder than surging inflation is a headache not only for the ECB but also for households whose purchasing power is being eroded. Stagflation is... 1st June 2022 · 5 mins read
Europe Data Response Euro-zone Unemployment (Apr.) The euro-zone unemployment rate remained at a record low in April and the latest business surveys suggest that employment will continue to increase at a decent pace. With the labour market remaining... 1st June 2022 · 2 mins read
Commodities West’s detachment from Russian energy gathers pace The EU’s sixth round of sanctions on Russia marks yet another defining moment in the West’s detachment from Russia’s energy trade. The sanctions were widely telegraphed in advance, though, so for now... 31st May 2022 · 4 mins read
Europe Commercial Property Update Office rent growth to slow, but quality gap could arise Both our view and that of the IPF Consensus is that prime office rental growth will slow as hybrid working shifts take their toll. However, we also think it is likely that a quality gap will emerge... 31st May 2022 · 3 mins read
Europe Data Response Euro-zone Flash HICP (May) With headline and core inflation rising more than expected yet again, the case for exiting from negative interest rates promptly is now irrefutable. The ECB looks sure to confirm next week that it... 31st May 2022 · 2 mins read
Europe Data Response Germany and Spain Flash Inflation (May) German and Spanish inflation data for May provide more ammunition for those who will argue at next week’s monetary policy meeting that the ECB should exit negative interest rates promptly, rather than... 30th May 2022 · 2 mins read
Europe Data Response EC Survey (May) The EC Economic Sentiment Indicator for May was almost unchanged from April, well below its pre-Ukraine war level and consistent with economic activity stagnating in Q2. The survey also suggests that... 30th May 2022 · 2 mins read
Europe Economics Weekly Struggling economy will not put ECB off 50bp hike Data released this week suggest that there are upside risks to our forecast for GDP to contract in Q2, but the economy still looks set to perform very poorly this year. And we doubt that this weak... 27th May 2022 · 9 mins read
Europe Economics Update PEPP redemptions no substitute for spread-fighting tool The ECB’s guidance that it can use PEPP reinvestments to contain bond spreads has a few big limitations. If the forthcoming interest rate hikes cause spreads to blow out, the ECB will either need to... 26th May 2022 · 3 mins read
Europe Commercial Property Update Do recession risks threaten euro-zone rental growth? The risks of a recession in the euro-zone have risen. While we think a contraction will be narrowly avoided, this will remain a concern for property investors already facing the prospect of higher... 26th May 2022 · 3 mins read
Europe Economics Update ECB to follow Fed’s lead with 50bp hike With inflationary pressures remaining intense and policymakers keen to get the deposit rate out of negative territory, we now think the ECB is most likely to raise rates by 50bp in July and by 125bp... 26th May 2022 · 4 mins read
Europe Economics Update Answers to your questions on the ECB We held a Drop-In today to discuss our views on the ECB and what the chances are of a further hawkish surprise in the coming weeks. (You can see an on-demand recording here.) This Update answers... 24th May 2022 · 4 mins read
