Filtered by Region: Europe Use setting Europe
Russia dips into the pre-election playbook Russia’s government this week unveiled new lump-sum payments to pensioners and military personnel ahead of September’s election, strengthening our above-consensus views on inflation and rates. The government will …
27th August 2021
This week saw the release of the first euro-zone business surveys for August, which provided reassurance that the region’s economy continued to grow strongly this month despite concerns about the Delta variant. Although the euro-zone Composite PMI and the …
The list of anecdotal reports of labour and product shortages has grown ever longer in the past week and now includes McDonald’s milkshakes and various items at Greggs. These add to the broadening range of sectors, such as hospitality, wholesale and …
July’s fall in CPI inflation from 2.5% in June to 2.0% was the first time since March that inflation has surprised the consensus on the downside. But it probably won’t have provided the Monetary Policy Committee (MPC) with much relief, for two reasons. …
20th August 2021
Norges Bank gets its nose in front The Norges Bank’s “interim” August policy announcement on Thursday did not upset the form book, and the Bank left interest rates on hold at a record low of zero once again. (See here .) The Bank said that economic …
Activity continuing to increase The latest national accounts data confirmed this week that GDP grew by 2% q/q in the second quarter (see here ), but that’s old news now. Timelier data suggest that the economy has continued to grow, with only limited …
Wrapping up a week of instability in Poland Poland's political scene was thrust into uncertainty this week after President Duda dismissed Jaroslaw Gowin, the leader of one of the coalition partners, from his duties and his Agreement party pulled out of …
13th August 2021
The GDP figures for June, which showed that the economy grew by 1.0% m/m after the 0.6% m/m rise in May, was an impressive result given the surge in COVID-19 cases in that month. (See here .) But we warned a couple of weeks ago that the “pingdemic”, which …
With six weeks left until Germany’s federal elections, on 26 th September, opinion polls suggest that things have got more complicated. In brief, and with apologies for the alphabet soup, they show that support for the CDU/CSU has declined compared to …
All eyes on the north Atlantic The world tends to only take notice of Iceland after spectacular events, be it the implosion of its banking sector or the explosion of a volcano . The country has been thrust into the spotlight once again recently following …
NBP’s doves losing their nerve… A slew of comments from policymakers at the National Bank of Poland (NBP) this week suggest that the probability of the central bank delivering a rate hike before the end of this year has increased. Flash July CPI data …
6th August 2021
We learnt three things from this Thursday’s Bank of England policy decision and were left in the dark on two key issues. As a result, some of our forecasts for money market rates and gilt yields have changed. What we learnt First, the Bank of England …
It was a week of more generally good news for the euro-zone economy. The risk that the Delta variant would halt the recovery in its tracks is receding rapidly. Daily infection numbers are now falling consistently in Spain and the Netherlands, which were …
A macroeconomist’s take on the Olympics Rather than just enjoying the spectacle of Norway’s Karsten Warholm storming to victory in the 400m hurdles this week, we found ourselves frustrated by the emphasis that sports reporters put on nominal rather than …
CBRT conceding the fight against inflation? Turkey’s central bank raised its inflation forecasts in its latest Inflation Report and Governor Kavcioglu’s comments suggest that policymakers are unlikely to step up to the plate in the fight against …
30th July 2021
This week brought further signs that the “pingdemic” weighed on economic activity in July. (See here .) The number of people having been asked by the NHS App or Test & Trace system to self-isolate has almost doubled in the past three weeks, reaching 1.3 …
Data published today revealed that the euro-zone economy grew more rapidly than anticipated in Q2, with GDP rising 2.0% q/q whereas the consensus and our forecast were both for 1.5%. As we pointed out earlier , the upside surprise was due to very strong …
The ECB followed up on its new strategy this week by raising the bar for future interest rate hikes. (See here .) The key change is that the Governing Council now says it will leave policy rates at current rates or lower until it sees inflation reaching …
23rd July 2021
Next year’s games will be better for Team N&S While the Swedish women’s football team humbled the USA in the first game of their Olympic campaign this week, Switzerland and the Nordic countries don’t tend to excel in the summer games. Indeed, as shown in …
Israel’s virus wave could be a warning for others The experience of Israel in recent weeks serves as a reminder that vaccine campaigns across Emerging Europe still have some way to go and that we are likely to have to learn to live with COVID long term. …
16th July 2021
Earlier today we published our European Economic Outlook , in which we revised up our euro-zone GDP growth estimates this year and next, to an above-consensus 5.0% and 4.5% respectively. The rebound will be faster in the core countries than in the …
You guessed it: no change at the SNB The Swiss National Bank is nothing if not consistent. It has left interest rates unchanged since 2015 and is not shy about using the “copy and paste” function in its press releases. So it seems only natural that …
In response to the jump in CPI inflation from 2.1% in May to 2.5% in June (see here ) and yet more signs that the labour market is bouncing back (see here ), two members of the Monetary Policy Committee (MPC) this week indicated that policy will need to …
Loose for (slightly) longer The ECB’s new symmetric 2% inflation target, with some tolerance for overshooting, is not as radical as it could have been, and does not grant the Bank as much flexibility as the Fed. But it is an important change that means …
9th July 2021
SNB policy tied to the ECB’s The adoption of a 2% inflation target by the ECB this week, and the announcement that the Bank will allow inflation to overshoot if needed, will not have been a he surprise to policymakers in Switzerland and the Nordics. …
CBRT unlikely to win the war with dollarisation Turkey’s central bank (CBRT) took steps this week to tackle deposit dollarisation in the banking sector, but these efforts will fail to make headway in the absence of a stronger commitment to rein in high …
2nd July 2021
It’s understandable that the start of the winding up of the furlough scheme on 1 st July (when firms had to start paying 10% of the wages of their furloughed workers) has caused some concern. After all, even after taking into account the cumulative cost …
This week has seen another set of stellar business surveys, underlining that the recovery is still going strong. The final headline euro-zone Manufacturing PMI for June was revised up from the flash estimate to a new record high. And the EC’s economic …
“Stockholm Street” or “Stockholm-enders”? This week saw the latest instalment of the political soap opera in Sweden. Having lost a “no confidence” vote on the 21 st June (see here ), the resignation of Prime Minister Stefan Löfven on Monday means the …
Global developments driving the Nordic majors After last week’s seemingly counterintuitive drop in the NOK following the hawkish message from the Norges Bank (see here ), it was the turn of the Swedish Krona to apparently defy the laws of the market: the …
25th June 2021
Another week, another set of euro-zone survey data highlighting the strength of the region’s economic bounce back as virus restrictions are lifted on the services sector. The flash Composite PMI for the euro-zone rose to its highest level in 15 years and, …
The evolving outlook for monetary policy on the other side of the Atlantic has once again been partly to blame for recent movements in UK markets. Like in the US, the yield curve flattened after the Fed became more hawkish at its May meeting, although …
Norges Bank trumped by the US Fed The Norges Bank laid its cards on the table this Thursday, all but confirming that it will start to raise its key interest rate from September. (See here .) In the event, it was overshadowed by the less anticipated news …
18th June 2021
Falling vegetable prices In a week when we learnt that core inflation in the US reached a 28-year high of 3.8% in May it is difficult to know what to make of the detailed discussion of vegetable prices in Statistics Sweden’s CPI press release . The good …
11th June 2021
Please entertain me, Statistics Denmark Statistics Denmark’s website is always a good place to start if you’re looking for some off-the-wall statistics to liven up an otherwise data-light week, and this week was no exception: we learned that the average …
21st May 2021
Economic analysis at the cutting edge Given that the Riksbank left its policy settings on hold in April, the minutes from the meeting (which were released this week) were never going to be a rip snorter. That said, we were keen to pore over them for clues …
14th May 2021
What’s Swedish for “gangbusters”? Preliminary GDP data released last week indicated that Swedish output had already surpassed its pre-virus level in March – faster than it takes many to assemble IKEA furniture. In the meantime, the strong set of activity …
7th May 2021
GDP data published this morning confirmed that the euro-zone economy contracted slightly in Q1, even though the business and consumer surveys painted an improving picture. Those same surveys suggest that sentiment and activity improved again in April. The …
30th April 2021
EC offering carrots, following failure of the stick The long-running saga over a new bilateral “framework agreement” between Switzerland and the EU is back in the news, with the current Swiss President, Guy Parmelin, set to meet his European Commission …
23rd April 2021
Public health officials calling the shots This week’s decision by Denmark to discontinue usage of the AstraZeneca vaccine understandably took the headlines. (Incidentally, note that the jab is now officially known as ‘Vaxzevria’, which could be a …
16th April 2021
The IMF gives Switzerland tops marks for effort The IMF completed its latest Article IV consultation with Switzerland this week. The concluding statements of such missions are typically rather anodyne but this one included some linguistic flourishes. For …
9th April 2021
Norges Bank’s Intentions (4,4): RATE HIKE The Norges Bank’s decision to leave its policy rate on hold at zero this week was never really in doubt. However, as we expected, policymakers shifted to a more hawkish stance and prepared the ground for the start …
19th March 2021
After weeks of indecision the ECB pledged yesterday to make “significantly higher” bond purchases in the coming quarter. (See here .) As weekly purchases since New Year have averaged €14bn, anything less than €20bn would, in our view, not be …
12th March 2021
Oh no, not more ECB QE! The SNB would have been forgiven for being a bit perturbed by the dovish message from the ECB yesterday that it expects the pace of its asset purchases to be “significantly higher” in the coming quarter. After all, the prospect of …
Swiss franc seems set to fall further Swiss inflation came in below expectations in February (see here ), but the period of deflation is likely to end soon. As elsewhere, the latest manufacturing PMI pointed to rising price pressures from disruption and …
5th March 2021
This week, pressure on bond yields, inflation and national health services continued to build. Daily Covid-19 infections are rising again in Italy and France, and the number of people in intensive care with Covid is increasing in both countries. (See here …
No sooner had we put the final touches to our quarterly Outlook than some of the downside risks to our forecasts have begun to materialise. Our prediction of a brisk recovery in GDP beginning in the second quarter was based on two assumptions: (i) that …
29th January 2021
In contrast to the relentlessly grim epidemiological numbers, the economic data for the euro-zone published this week have been fairly positive. The 2.5% m/m increase in euro-zone industrial production in November points to output rising in Q4, helping to …
15th January 2021
The number of new coronavirus cases came down in many countries before Christmas as a result of the tighter restrictions in place. But since then, things have taken a turn for the worse. New cases have been increasing at the beginning of the year in …
8th January 2021
US Treasury not on the SNB’s Christmas card list The SNB’s final policy meeting of the year (see here ) was overshadowed by the news on Wednesday that the US Treasury designated Switzerland, along with Vietnam, a “currency manipulator” in its latest …
18th December 2020
