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Omicron won’t cause euro-zone to contract in Q1

Omicron will reduce economic activity in the coming weeks due to tighter restrictions, consumer caution and absenteeism. Our best guess is that economic activity in the euro-zone will decline in January but for now we assume it will rebound in February. We are pencilling in GDP growth of 0.5% q/q in Q1.
Andrew Kenningham Chief Europe Economist
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European Data Response

German Industrial Production (November)

The unexpected decline in German industrial production in November increases the chance that GDP fell in the last quarter of 2021. And with the Omicron variant likely to hit Germany hard in the coming weeks, the outlook for Q1 is also looking poor.

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European Data Response

Germany Flash Inflation (December)

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European Economics Update

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