10 November 2023 Eurozone Monitor What Does the ECB Need to See to Cut Its Deposit Rate in Q1?

•  The central message from ECB policymakers is still that interest rates won’t be lowered any time soon...
• ...but we still see a path to a first rate cut in March, as core inflation undershoots the ECB’s forecasts.
• Sticky wage growth and rising unit labour costs are the main threats to our forecasts for cuts in H1 2024.

Claus Vistesen (Chief Eurozone Economist)Eurozone

EZ Datanote: Detailed Inflation, Germany, October 2023

In one line:  Slide in inflation is in full swing.

Melanie Debono (Senior Eurozone Economist)Eurozone

EZ Datanote: Retail Sales, Eurozone, September 2023

In one line: A third straight monthly decline. 

Melanie Debono (Senior Eurozone Economist)Eurozone

EZ Datanote: Trade Balance, France, September 2023

In one line: Confirming that net exports were a drag on GDP in Q3. 

Melanie Debono (Senior Eurozone Economist)Eurozone

9 November 2023 Eurozone Monitor Revising Down Our Call for EZ Consumption in Q4

• Retail sales slid in each month in Q3, making it a quarter to forget for the sector.
• Services spending rose in August, picking up the slack; surveys suggest it won’t do so again in Q4.
• We are revising down our consumption call for Q4 and therefore now look for a shallow EZ recession.

Melanie Debono (Senior Eurozone Economist)Eurozone

EZ Datanote: Industrial Production, Spain, September 2023

In one line: Not enough to prevent a quarterly fall in Q3 overall. 

Melanie Debono (Senior Eurozone Economist)Eurozone

EZ Datanote: Industrial Production, Germany, September 2023

In one line: Ouch!

Melanie Debono (Senior Eurozone Economist)Eurozone