Euro-zone Retail Sales (Aug.)

August’s euro-zone retail sales data suggest that consumer spending on goods is flatlining. But overall consumption is still likely to have grown fairly strongly in Q3 as spending on services increased.
Michael Tran Assistant Economist
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European Economics Update

Revising down our Q4 growth forecast

Tighter Covid restrictions and increased consumer caution appear to be causing euro-zone activity to decline. We have revised our euro-zone Q4 GDP growth forecast down to 0.2% q/q and the risks are still to the downside. Although there is still a lot of uncertainty, Q1 looks set to be weak too.

8 December 2021

European Economics Update

Dutch economy to grow strongly after restrictions end

The tightening of Covid restrictions in the Netherlands in response to the resurgence of the virus there in recent weeks will put a temporary brake on GDP growth in Q4. But we think that the underlying strength of domestic demand and an increase in net trade will allow a swift recovery once the pandemic restrictions are lifted again.

8 December 2021

European Data Response

Euro-zone GDP & Employment (Q3)

Data released today show that the euro-zone economy recovered to within 0.5% of its pre-pandemic level in Q3. But with Covid cases rising, governments tightening restrictions, and supply problems constraining output, the economy looks set for a very weak fourth quarter.

7 December 2021

More from Michael Tran

European Data Response

EZ Unemployment (Aug.)

The fall in euro-zone unemployment in August brings the jobless rate back very close to its pre-pandemic level. But employment is still below pre-virus levels, highlighting that the labour market recovery still has a long way to go. Labour market slack will continue to weigh on wage growth.

30 September 2021

European Data Response

German Ifo Survey (September)

The third successive decline in the Ifo Business Climate Index in September provides further evidence that Germany’s recovery is losing steam, as supply chain difficulties persist and the surge in gas prices piles additional pressure on prices and production. That said, we still expect strong GDP growth in Q3, given the low base at the start of Q2.

24 September 2021

European Data Response

Euro-zone Retail Sales (July) & Final PMIs (Aug)

The recovery in euro-zone retail sales ended in July as sales fell sharply compared to June. However this does not affect our view that consumption will grow strongly in Q3, not least because we think the fall in retail sales partly reflects consumers shifting their spending from goods to services.

3 September 2021
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