Inflation to stay much lower in euro-zone than US

Data published this week confirmed that inflation is extremely weak in the euro-zone, and we expect it to remain well below target in the coming years even as inflation rises above 2% in the US. Next week, the first estimates of Q4 GDP looks set to show that Germany avoided a contraction, but the economies of France and Spain shrank. Declines in GDP in Q1 look very likely too.

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