EZ Datanote: Detailed CPI, Germany, November 2022

In one line: Energy inflation is easing, but the core is holding firm.

Claus Vistesen (Chief Eurozone Economist)Eurozone

19 Sept 2022 Eurozone Monitor We Still Look for 75bp in October as Core Inflation Rises, Again

• A further leap in core inflation in September will push the ECB to deliver another 75bp hike next month.
• Energy inflation is now falling, slightly, but it won’t prevent the headline from rising again in September.
• Disinflation in oil products is accelerating, but gas and electricity prices still have further to rise.

Claus Vistesen (Chief Eurozone Economist)Eurozone

15 Sept 2022 Eurozone Monitor Europe Faces Difficult Trade-Offs on Energy as Winter Approaches

• The EU proposes further windfall taxes and energy saving to get through winter.
• Brussels is also mulling big reforms of electricity markets, but likely after Christmas.
• Delinking gas and electricity prices in the EU would risk outright supply shortages during peak demand.

Claus Vistesen (Chief Eurozone Economist)Eurozone

EZ Datanote: Final Inflation, Germany, August 2022

In one line: Core inflation will rise above 4% in September and October.

Claus Vistesen (Chief 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

5 Sept 2022 Eurozone Monitor Leading Indicators Still Signal a Recession in Germany

• Germany is now likely entering a technical recession, but inventories and net trade are wildcards.
• The survey data in Germany are plunging, and real M1 growth is sinking without a trace...
• ...But near-real-time data are holding up and early hard data for Q3 have been robust.

Claus Vistesen (Chief Eurozone Economist)Eurozone

1 Sept 2022 Eurozone Monitor A New Record in the EZ Core CPI Signals a 75bp Hike Next Week

• When the facts change, so do our forecasts; we now think the ECB will hike by 75bp next week.
• Headline inflation in the Eurozone could hit 10% in September, with core inflation at 4.5%.
• Core goods inflation is rocketing, and it likely will remain higher than implied by surveys, for a while.

Claus Vistesen (Chief Eurozone Economist)Eurozone

31 Aug 2022 Eurozone Monitor The ECB is Priming Markets for a Series of 50bp Rate Hikes

• We now think the ECB will lift rates by 50bp three times this year, but still expect a pause in H1-23.
• Today's EZ inflation data will offer little relief for markets recently stung by hawkish ECB comments.
• Surveyed inflation expectations are falling, in line with the idea of a reduced tightening pace in 2023.

Claus Vistesen (Chief Eurozone Economist)Eurozone