Europe Economics Focus Euro-zone set for years of austerity-lite After years of fiscal largesse, austerity is back. We suspect that budget cuts will reduce euro-zone GDP growth by only around 0.1 or 0.2 percentage points per year over the next five years. But the... 1st February 2024 · 15 mins read
Europe Rapid Response Euro-zone HICP (January 2024) January’s euro-zone inflation data were a little stronger than we had expected after the data for Germany and France were released yesterday. While the euro-zone’s headline and core inflation rates... 1st February 2024 · 2 mins read
Europe Rapid Response Germany HICP Inflation (January 2024) National data published so far suggest that headline and core inflation in the euro-zone came down a little more than we had expected in January. This makes us more confident in our view that the ECB... 31st January 2024 · 2 mins read
Global Economics Focus Tight real policy stance supports case for big rate cuts The drop in inflation across advanced economies has caused real interest rates to rise by even more than nominal rates. While there are various ways to measure real interest rates, they all confirm... 31st January 2024 · 17 mins read
Europe Economics Update Strength in services price expectations a concern January’s European Commission business and consumer survey, released this morning, supports our view that the euro-zone economy will stagnate in Q1. But recent increases in services firms’ price... 30th January 2024 · 2 mins read
Europe Rapid Response Euro-zone GDP (Q4 2023) The euro-zone economy stagnated in Q4 and we think that it will flat-line in the first half of this year too as the effects of past monetary tightening continue to feed through and fiscal policy... 30th January 2024 · 2 mins read
Global Markets Update With cuts almost in sight, we still see scope for DM yields to fall We think the recent falls in long-dated government bond yields across developed market (DM) economies will extend over the remainder of this year, as central banks generally cut by more than investors... 29th January 2024 · 4 mins read
Europe Economics Weekly Misinterpreting the ECB Most commentators and investors have concluded that yesterday’s ECB meeting signalled that an April rate cut is a near certainty. We disagree. While an April rate cut is still our base case, the risks... 26th January 2024 · 9 mins read
Europe Economics Update Money supply bottoming out but lending to stay weak Data released this morning suggest that the collapse in the euro-zone’s money supply might be over. But we expect money and lending growth to remain fairly weak. 26th January 2024 · 2 mins read
Capital Daily What to make of the ECB market fallout While the dovish reaction to today’s ECB meeting came as a bit of a surprise, we continue to think that the direction of travel for Bund yields – and most sovereign bond yields – will be down this... 25th January 2024 · 4 mins read
Europe Economics Update ECB signals summer rate cut The ECB kept interest rates unchanged and stuck to the argument that a first rate cut is most likely in the summer. An earlier move is still possible if the inflation data are weak in the next few... 25th January 2024 · 3 mins read
Europe Commercial Property Update Latest RICS survey offers little sign of recovery The latest RICS survey offered tentative signs that we could be past the worst of the property downturn in Europe, as both occupier and investment demand balances picked up slightly. However, the big... 25th January 2024 · 3 mins read
Europe Rapid Response ECB sticks to its guns Today’s decision to leave interest rates unchanged, and the tone of the press release, were as expected. In the forthcoming press conference, Christine Lagarde is likely to push back against... 25th January 2024 · 2 mins read
Europe Rapid Response Euro-zone Flash PMIs (Jan. 2024) January’s euro-zone Composite PMI, published this morning, remained consistent with the economy contracting by around 0.2% q/q. 24th January 2024 · 3 mins read
