In one line: Not enough to prevent a quarterly fall in Q3 overall.
Melanie Debono (Senior Eurozone Economist)Eurozone
- German industry was in recession in early H2, and we suspect it will remain so at least to year-end.
- Spanish industry ended Q3 on a high but was still also in recession.
- Construction will continue to struggle; risks to our call for EZ GDP to rebound are to the downside.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- The PMIs warn that the slowdown in the EZ economy is becoming more broad-based...
- ...But they’re probably too pessimistic, and investor sentiment points to better headlines ahead.
- German factory orders edged higher in September, but the details show that overall weakness persists.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Pointing to better times ahead for the economic surveys.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: The slowdown is becoming broad-based.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Headline lifted by large orders, and revisions signal downside risks to the initial Q3 GDP estimate.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- The EZ unemployment rate will rise further, but prob- ably not enough to sway ECB hawks...
- ...Still, we think the Bank will cut rates come March, as inflation likely will fall faster than it expects.
- Unemployment will rise most in industry, which will stay in recession until global trade recovers.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Net exports in goods were virtually flat in Q3.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: French industry stuttered at the end of Q3.
Melanie Debono (Senior Eurozone Economist)Eurozone
- The slide in Swiss inflation appears to have stalled but we do not think the SNB needs to panic-hike.
- GDP in Switzerland likely fell in Q3—following in Ger- many’s footsteps—and likely will decline again in Q4.
- The election outcome means we should expect “more of the same” on the Swiss fiscal front.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: No end in sight for the recession in EZ manufacturing.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: The increase in claims is accelerating; unemployment to rise further in Q4.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- The rise in bund yields since summer is driven by a higher term premium, from a depressed level.
- Medium-term forecasts for the ECB’s policy rate suggest that the term premium could rise further.
- We still see a near-term fall in bond yields as core inflation undershoots the ECB’s expectations.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: EZ headline inflation will snap back in coming months; GDP is going nowhere.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Avoided a technical recession, just.
Melanie Debono (Senior Eurozone Economist)Eurozone
- EZ inflation plunged in October, but energy inflation will snap back in November and December.
- We still see a much quicker fall in core inflation than the ECB between now and March.
- GDP in the Eurozone fell slightly in Q3, and we look for another poor quarter in Q4, with zero growth.
Claus Vistesen (Chief Eurozone Economist)Eurozone
