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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

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investors

20 Jan 2022 Will the Real Trade Data in the Eurozone Please Stand Up?

  • The EZ's trade surplus in goods is a lot perkier if we choose to believe the ECB's current account data.
  • Net services exports likely jumped in Q4, but this means intellectual property investment plunged.
  • EZ portfolio outflows are now slowing, belatedly; inflows signal trouble for equities in 2022.

Claus Vistesen (Chief Eurozone Economist)Eurozone

13 Jan 2022 What can Investors Expect from EZ Equities in a Post-Virus World?

  • Valuations point to subpar returns for euro area large-cap equities in the post-pandemic expansion.
  • Equities in Spain and Italy are priced for average returns of around 10% in the next five years…
  • …The corresponding numbers for German and French equities are just 5% and 2½%, respectively.

Claus Vistesen (Chief Eurozone Economist)Eurozone

11 Jan 2022 A Regime Shift is Underway in the Euro Area's Labour Market

  • EZ unemployment fell further in November, due to an improvement in all major economies.
  • Unemployment in the euro area will fall below 7% soon, even with Omicron now a near-term threat.
  • Our labour market forecasts imply accelerating wage growth in 2022; the ECB will take note.

Claus Vistesen (Chief Eurozone Economist)Eurozone

24 Dec 2021 Spain Still the Laggard, Despite Upward Revision to Q3 GDP

  • The upward revision to Q3 GDP in Spain still leaves it further below the Q4 2019 level than elsewhere...
  • ...The recovery has now slowed sharply; we look for just 1.0% growth in Q4; risks are to the downside.
  • Data over the holidays are likely to show soft retail sales and yet more softening in business surveys.

Claus Vistesen and Melanie DebonoEurozone

22 Dec 2021 The Euro Glut is Swelling, this time due to EZ Demand for Equities

  • The ECB’s data continue to paint a less dramatic picture of trade in goods than Eurostat's numbers.
  • Net services exports likely will jump in Q4, but this will be offset in part by a fall in IP capex.
  • The euro glut has expanded during the pandemic, due mainly to a rise in EZ foreign equity holdings.

Claus Vistesen and Melanie DebonoEurozone

20 Dec 2021 EZ Inflation Will be Close to 3% in 2022, and the Core will Hit 2%

  • We are raising our headline inflation forecasts for next year, but we're still well behind the ECB.
  • Core inflation will hover around 2% for much of next year, causing a headache for the central bank.
  • More poor survey data reassert our view that Q4 and Q1 won’t be pretty for the EZ’s largest economy.

Claus Vistesen and Melanie DebonoEurozone

17 Dec 2021 EZ Monetary Stimulus is Set to Slow Next Year, Virus Permitting

The ECB will end PEPP in March, but is keeping the door open for a resumption if the virus worsens.

ECB asset purchases will be around €500B next year on current plans, half the pace in 2021.

The SNB is standing pat, as expected, and we're lowering our outlook for EZ growth in Q1.

Claus Vistesen and Melanie DebonoEurozone

16 Dec 2021 Suddenly, the Near-term Path Ahead for the ECB is Less Clear

Ms. Lagarde will stick to the signal that PEPP is likely to end in March, but Omicron is a big risk to this call.

The ECB's inflation forecasts will increase today; how close to 2% will they be for 2023 and 2024?

No rate hikes in 2022, but speculation about lift-off will intensify in the next six-to-12 months.

Claus Vistesen and Melanie DebonoEurozone

14 Dec 2021 Wage Growth in the EZ Set to Accelerate in 2022, We Think

All signs point to stronger EZ wage growth next year, but it won't be easy to tell in real time.
Negotiated wage growth is still slowing, but the ECB’s preferred compensation measure is firming.
The trend in unemployment points to negotiated wage growth rising towards 3% next year.

Claus Vistesen and Melanie DebonoEurozone

25 Nov 2021 We're Slashing our Q4 Forecasts in France, Despite Great Surveys

  • The Q4 survey data in France have been robust so far, pointing to solid underlying GDP growth…
  • …But the return of the virus threatens new restrictions, putting Christmas festivities in question.
  • We're reducing our forecast for Q4 quarteron-quarter GDP growth, by 0.6pp, to 0.6%.

Claus Vistesen and Melanie DebonoEurozone

22 Nov 2021 Swiss GDP Recovered in Q3; SNB seems OK with EURCHF at 1.05

  • Switzerland's economy probably grew by 2% q/q in Q3, taking output back above its pre-virus level.
  • Q3 is old news; growth is now slowing and the risks to the outlook are rising as virus cases surge.
  • The SNB won't stay happy with CHF 1.05 per euro for much longer.

Claus Vistesen and Melanie DebonoEurozone

19 Nov 2021 A Sinking Euro Adds to the Upside Risk for the ECB's CPI Forecasts

  • Euro depreciation adds additional upside risk to the ECB's December core inflation forecasts.
  • The outlook for relatively rapid Fed tightening is leading the euro lower, but fundamentals matter too.
  • Recent comments from Isabel Schnabel suggest the ECB is o.k. with expectations of a hike in 2023.

Claus Vistesen and Melanie DebonoEurozone

15 Nov 2021 How Inflationary is the Green Energy Transition in the EZ?

  • The green energy transition can be modelled as a sustained inflationary supply shock to the economy.
  • In the extreme case, a rise in oil and gas prices could lift EZ inflation by 0.5pp between now and 2026.
  • The price of CO2 emissions is rising; it could lift EZ inflation significantly over the next few years.

Claus Vistesen and Melanie DebonoEurozone

9 Nov 2021 Markets are Listening to the ECB, but Still Expect a Hike in 2022

  • Futures-implied interest rates have declined sharply, but markets still look for a hike in 2022.
  • Volatility in short-term rate expectations points to a quicker-than-expected slowdown in QE next year.
  • Strong earnings have protected equities from fixed income volatility, but growth is now slowing.

Claus Vistesen and Melanie DebonoEurozone

4 Nov 2021 Will Unemployment in the Eurozone Hit 6% by 2023?

  • EZ unemployment fell again in September, and survey data point to further improvement in Q4.
  • We think Eurozone unemployment will fall below 7% next year, hitting 6% by 2023.
  • The SNB is fine with EURCHF closing in on 1.05, but only for as long as inflation is rising.

Claus Vistesen and Melanie DebonoEurozone

28 Oct 2021 The ECB will Push Back Against Rising Rate Expectations Today

  • Rising rate expectations are at odds with the ECB's forward guidance; we expect a push-back today.
  • We still think the PEPP will end in March, but don't look for a clear signal today either way.
  • Mixed consumer confidence data in the core, and a slowdown in headline EZ money supply growth.

Claus Vistesen (Chief Eurozone Economist)Eurozone

19 Oct 2021 EZ Equity Earnings are Rising, but Can the Upturn Continue?

  • EZ equity earnings have recovered handsomely this year, leaving valuations more attractive.
  • Markets still expect strong earnings growth in the next 12 months; the macro data suggest otherwise.
  • The pace of policy tightening implied by global rate expectations will soon be an issue for EZ equities.

Claus Vistesen (Chief Eurozone Economist)Eurozone

15 Oct 2021 Spanish Firms Disproportionately Impacted by Surging Gas Prices

  • Gas prices in Europe have continued their rise since the start of the year...
  • ...Governments are trying hard to shield consumers, but businesses will be hit harder.
  • Our analysis shows that consumers and firms in Spain will be impacted most in the EZ

Claus Vistesen (Chief Eurozone Economist)Eurozone

15 Oct 2021 Core Inflation in Germany Will Rise above 3% in the Fourth Quarter

  • German core inflation is still rising; we think it will hit 3%-plus in Q4, before easing in January.
  • Electricity inflation in Spain is still rocketing, threatening consumer's real incomes and industry.
  • Core inflation in Spain is now back at its pre-virus rate; should we be looking for an overshoot now?

Claus Vistesen (Chief Eurozone Economist)Eurozone

13 Oct 2021 GDP Growth Forecast Down and Inflation Forecasts Up in the EZ?

  • We look for lower consensus growth forecasts in Q4, even as inflation forecasts advance further.
  • Fiscal stimulus is a wildcard for 2022 GDP forecasts, but near-term risks remain tilted to the downside.
  • Stagflation risks are real, warning of less potent fiscal stimulus and a more constrained ECB.

Claus Vistesen (Chief Eurozone Economist)Eurozone

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