16 May 2025 Eurozone Monitor Swiss economy galloping in 2025, though growth is now slowing

• Switzerland’s economy was on a tear before the trade-tariff shock hit. 
• Strong growth is not inflationary, and is now slowing; the SNB will cut in June, taking rates below zero. 
• EZ GDP was revised down in Q1 and will also slow ahead, but the unemployment rate will stay low.

EZ Datanote: ZEW, Germany, May 2025

In one line: Investor sentiment rebounds. 

14 May 2025 Eurozone Monitor More signs EZ GDP growth is holding up in Q2

• Investor sentiment, measured by the ZEW, improved in May despite a fall in the current conditions index. 
• Investor sentiment now points to a rebound in the PMI as markets forget all about tariffs. 
• Near-real time data also signal resilience in the EZ economy midway through the second quarter.

EZ Datanote: Industrial Production, Italy, March 2025

In one line: Industry will likely support GDP again in Q2, but downside risks remain.

EZ Datanote: Industrial Production, Spain, March 2025

In one line: Decent, and strength likely to continue for now. 

EZ Datanote: Retail Sales, EZ, March 2025

In one line: Still trending sideways, as they have since November. 

EZ Datanote: Construction PMIs, Eurozone, April 2025

In one line: Rise in demand in Germany pulls up headline. 

8 May 2025 Eurozone Monitor Construction PMI rise still under-estimating growth in the sector

• The EZ construction PMI rose in April, on the back of a recovery in new orders in Germany. 
• Construction activity is still faring better in Italy than in Germany or France. 
• The sector is likely to support EZ GDP in Q2, as it seems to have done in Q1.

6 May 2025 Eurozone Monitor Soft headline inflation will pave the way for a 1.75% depo-rate by July

• Jump in April core inflation was due to Easter effects in services; the remaining components were soft.
• Dovish forecasts from the ECB will pave the way for for a back-to-back 25bp rate cut next month…
• …and we now look for an additional 25bp cut in July, but also hikes next year, in June and September.

EZ Datanote: PMI, Switzerland, April 2025

In one line: Consistent with slower growth in Q2. 

EZ Datanote: Advance GDP, EZ, Q1 2025

In one line: GDP growth pick up in Q1 will prove short-lived as trade uncertainty hits. 

EZ Datanote: ISTAT Confidence, Italy, April 2025

In one line: Business sentiment sours on pessimism in services.