In one line: Upside risks building in energy, but the Q1 core looks benign on our forecasts.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Core inflation is sticky around 3%.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Investment is falling off a cliff; what’s the play Mr. Merz?
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Dovish; upside risks for the headline in January, but electricity tariffs set to fall sharply in February.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- The investment downturn in Germany deepened in 2024; the new government will need to act.
- This year should be a year of recovery for growth in German household consumption.
- Headline inflation in France is set for a volatile few months due to big swings in energy prices.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- Euro area equities have been propped up by elevated margins, but can this continue?
- A forecast with margins one SD above their average still points to around 10% downside for EZ equities.
- Book value points to negative returns for EZ equity investors on a five-year basis.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Disappointing, but output will snap back quickly.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- GDP in France likely fell slightly in Q4, and we doubt that Q1 will deliver a strong rebound…
- …But we’re still betting that solid real income growth will support stronger GDP growth from Q2.
- We now forecast 2025 GDP growth in France of 0.8%, marginally higher than the consensus.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Disappointing, but still consistent with a rise in Q4.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Hit by declines in Germany and France; services are still holding up overall.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- Bunds now align with our 2025 forecasts, but they’ve likely come a little too far, too fast.
- The balance of risks for German Q4 GDP has shifted to the upside, but we still see zero growth.
- A fall in inventories is the key risk to Germany’s Q4 GDP print, offsetting a further rise in consumption.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Look beyond the headlines for a slightly better story.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: ECB doves were saved by France and Italy.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- A crash in major orders pushed German factory orders down in November; surveys remain poor.
- The upturn in German retail sales in Q4 is on track, despite soft data for October and November.
- French consumers’ unemployment fears are soaring, warning of a further rise in joblessness in Q1.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Another soft inflation print in France; soft core in Switzerland.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- EZ inflation data are in line with further gradualism from the ECB this month, implying a 25bp cut.
- We still see little chance of either EZ headline or core inflation making a perfect landing at 2%.
- Outright deflation is a remote risk in Switzerland; the SNB will make a final 25bp rate cut in March.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Hot; EZ inflation to overshoot the consensus tomorrow.
Claus Vistesen (Chief Eurozone Economist)Eurozone
