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Eurozone Publications

Below is a list of our Eurozone Publications for the last 6 months. If you are looking for reports older than 6 months please email info@pantheonmacro.com, or contact your account rep

Please use the filters on the right to search for a specific date or topic.

May

22 Sept 2022 Eurozone Monitor The Centre-Right Looks Set to Win in Italy; Big Challenges Await

  • Polls point to a right-wing coalition leading Italy soon; the economy is still headed for recession.
  • Deep-rooted issues need to be tackled to ensure a growth profile that keeps public debt sustainable.
  • BTP yields will rise until the new PM starts work, but will fall next year as political uncertainty abates.

Melanie Debono (Senior Eurozone Economist)Eurozone

14 Sept 2022 Eurozone Monitor Will the Energy Crisis and ECB hikes lead to a Credit Crunch?

  • Our forecasts for ECB rates imply a rise in mortgage rates of over 400bp, raising the risk of defaults.
  • Rising mortgage rates will mean house prices will be falling by around 1% year-over-year by end 2023.
  • Higher risk is already discouraging banks from lending, but a credit crunch will likely be avoided.

Melanie Debono (Senior Eurozone Economist)Eurozone

12 Sept 2022 Eurozone Monitor The SNB will Join the 75bp Rate Hike Club This Month

  • The rise in inflation since the SNB’s last meeting means it will surely raise rates on September 22.
  • The ECB went big last week; the SNB will follow suit as it seems happy with current franc strength.
  • In Q4 we think the SNB will hike by 50bp, much less than the 125bp we expect from the ECB.

Melanie Debono (Senior Eurozone Economist)Eurozone

6 Sept 2022 Eurozone Monitor The End of Russian Gas Flows is Pushing the EZ into Recession

  • The surge in gas prices adds to our conviction that inflation will remain high, despite a hit to EZ activity.
  • A probable EZ recession is weighing heavily on the outlook for Switzerland’s economy in H2.
  • EZ investor sentiment tumbled in September; it will sour further as the ECB continues to hike.

Melanie Debono (Senior Eurozone Economist)Eurozone

26 Aug 2022 Eurozone Monitor Q2 is the Best it's Going to Get for Germany this Year

German GDP grew by 0.1% in Q2, finally returning to its pre-virus, Q4 2019, level.

But the tiny expansion is now old news; survey data imply GDP in the EZ’s largest economy is now falling.

France’s economy will avoid a recession, we think, but risks here are also skewed to the downside.

Melanie Debono (Senior Eurozone Economist)Eurozone

23 Aug 2022 Eurozone Monitor Windfall Taxes are a Risk to the Profit Outlook of EZ Banks

Higher inflation for longer will lead to higher interest rates, which will support banks’ interest margins.

This implies higher profits, which makes bank equities attractive right now.

But risks to the profit outlook remain in the form of windfall taxes and falling demand for loans.

Melanie Debono (Senior Eurozone Economist)Eurozone

22 Aug 2022 Eurozone Monitor The Swiss Economy won't be Unscathed by the EZ Recession

  • Swiss GDP likely rose by 0.5% in Q2, the same as in Q1, and more or less in line with the EZ aggregate.
  • The German recession will weigh on Swiss industry in H2, and consumers’ income is being squeezed.
  • We look for GDP growth broadly to stagnate in H2, but the SNB is still likely to hike rates further

Claus Vistesen (Chief Eurozone Economist)Eurozone

9 Aug 2022 EZ Monitor Are the Largest EZ Economies Already Rationing Energy

We now think it’s likely that the EU manages to fill its gas storage levels to the target 80% by November.

Storage will be drained more this winter than in the past, given lower flows, even assuming no cold snap.

This is despite rationing, which we doubt can be avoided, and will push the EZ into recession by Q4.

Melanie Debono (Senior Eurozone Economist)Eurozone

2 Aug 2022 EZ Monitor The EZ Labour Market is Resilient, but Cracks are Now Showing

The EZ jobless rate held at a record-low in June, but the number of people unemployed rose slightly.

Ukrainian refugees are lifting labour supply less than expected, but we still see joblessness rising in H2.

We think the EZ unemployment rate will rise to 7.0% by year-end; risks to this forecasts are balanced.

Claus Vistesen (Chief Eurozone Economist)Eurozone

1 Aug 2022 EZ Monitor Robust GDP and Inflation Data Point to a 50bp Hike in September

Strong EZ macro data signal a 50bp hike in  September, but we no longer see a hike in February.

The German economy stalled in Q2, setting the scene for a technical recession in H2....

...EZ GDP rose by a solid 0.7% q/q in Q2, but we think it will be revised lower in time, probably to 0.4%.

Claus Vistesen (Chief Eurozone Economist)Eurozone

29 July 2022 EZ Monitor German core HICP inflation is still rising; it will peak in September

HICP core inflation in Germany rose further in July; it will peak in September, at just under 4%.

Energy inflation in Germany is now falling, but upside risks in gas and electricity are still substantial.

ESI sank in July, adding to the evidence of a significant slowdown in the EZ economy.

Claus Vistesen (Chief Eurozone Economist)Eurozone

28 July 2022 EZ Monitor Italian Surveys Softened in July; EZ Real M1 Growth is still Depressed

The slowdown in real M1 growth continues to suggest that the EZ economy is now in recession.

ISTAT’s ESI for Italy for July supports our view that Italy, with Germany, will be drags on EZ activity in Q3.

Consumers are shifting their attention to the worsening economic environment.

Claus Vistesen (Chief Eurozone Economist)Eurozone

26 July 2022 EZ Monitor Falling EZ Inflation Expectations will be a Relief for the ECB

Most measures of inflation expectations are falling, supporting our view that inflation is near its peak.

After starting its hiking cycle last week, the ECB will be able to take a break next year.

The drop in the IFO adds to the evidence that the EZ’s largest economy is now in a technical recession.

Melanie Debono (Senior Eurozone Economist)Eurozone

21 July 2022 EZ Monitor Europe remains exposed to a quick end to Russian gas flows

Russian gas will soon flow to Europe again, but at a severely reduced rate; a full shutdown remains likely.

The IMF estimates that Europe will be short some 50bcm gas if Russian supplies are halted, at best.

Only demand compression, via higher prices and or rationing, solves this problem; it will sting.

Claus Vistesen (Chief Eurozone Economist)Eurozone

19 July 2022 Fiscal Aid in Spain and Italy is Not Enough to Boost Consumption

Italy’s overall aid to offset rising living costs still trails that in Spain, despite new fiscal support.

The measures announced so far likely won’t fully offset the hit to real incomes from higher inflation.

Windfall taxes are not enough, and further debt issuance will keep a floor under debt servicing costs.

Melanie Debono (Senior Eurozone Economist)Eurozone

15 July 2022 When will Swiss Inflation Start to Fall? August is a Good Bet

All signs point to a drop in Swiss imported inflation; weaker growth will weigh on domestic prices.

Calling the peak in the headline rate is fraught with difficulty; our best bet is August.

A snap election may still be avoided, despite Italy’s Prime Minister Draghi’s resignation.

Melanie Debono (Senior Eurozone Economist)Eurozone

14 July 2022 EZ Core Inflation is Peaking, but it will Remain High Throughout 2022

Core inflation in Germany was depressed by one-off fiscal measures in June; it will rebound in September.

French HICP core inflation likely peaked in June, but it is still rising sharply in Spain.

EZ industrial production surprised to the upside in May, but we still think it fell over Q2 as a whole.

Claus Vistesen (Chief Eurozone Economist)Eurozone

12 July 2022 Taking Stock of the Energy Situation in Europe, Again

Gas prices likely will rise further as markets come around to the idea of sustained Russian supply cuts.

The weaker euro will keep energy inflation elevated, despite the recent fall in oil prices.

A price cap on Russian oil will be difficult for the West to enforce in practice.

Melanie Debono (Senior Eurozone Economist)Eurozone

7 July 2022 Is Germany Already in Recession? It's a Tight Call, but We Think So

Germany is now likely in recession, but net trade in services is a wild card for the Q2 GDP print.

By contrast, we are revising up our Spain Q2 GDP forecast, again; we now look for a 1.0% q/q rise.

Inflation was weighing on retail sales mid-way through Q2, but spending probably still rose.

Claus Vistesen (Chief Eurozone Economist)Eurozone

4 July 2022 Another Consensus-Beating CPI Print, But no 50bp Hike this Month

Headline inflation in the Eurozone hit a new record in June, and it will rise further still in Q3.

Falling rate expectations are easing the pressure on the ECB; we think it will stick to 25bp this month.

EZ manufacturing is still weakening; EURCHF will hover around parity through Q3.

Claus Vistesen (Chief Eurozone Economist)Eurozone

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