Eurozone Economic Outlook
December 20, 2019The economy kept pace in the third quarter, although growth was modest. The expansion was underpinned by healthy consumer spending, but restrained by cooling investment activity and an unsupportive external backdrop. Data suggests subdued momentum carried over into the final quarter of 2019. A sharper drop in industrial production in October, weak PMI readings in November-December and downbeat business sentiment in the first two months of Q4 point to protracted weakness, while feebler retail sales and consumer confidence indicate softening consumer spending. On the political front, the Conservative Party’s resounding victory in the UK elections on 12 December signals a clearer Brexit roadmap ahead, reducing related uncertainties. Meanwhile, in mid-November, the European Commission reproached France, Italy and Spain for not adopting meaningful fiscal adjustment, exposing themselves to potential economic shocks.
Eurozone Economic GrowthMomentum is set to remain feeble next year. Soft global growth and an uncertain external backdrop will dent exports and investment activity; smaller job gains, due to rigid labor markets in key countries, will restrain consumer spending; while political uncertainty in Italy and Spain, coupled with Brexit negotiations and a possible resurgence in global trade tensions, cloud the outlook. Growth is seen at 1.0% in 2020, which is unchanged from last month’s forecast. In 2021, GDP is seen increasing 1.3%.
Eurozone Economy Data
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|Exchange Rate||1.12||0.65 %||Dec 31|
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Eurozone Economic News
January 17, 2020
Complete data revealed harmonized inflation accelerated to 1.3% in December from November’s 1.0% and matched the preliminary estimate.
January 15, 2020
Industrial output increased a seasonally-adjusted 0.2% over the previous month in November, contrasting October’s 0.9% slump.
January 9, 2020
Labor market conditions in the common currency bloc improved somewhat in November, according to data released by Eurostat.
January 8, 2020
Sentiment in the Eurozone ticked up in December, although it remained quite downbeat.
January 7, 2020
Harmonized inflation accelerated to 1.3% in December from November’s 1.0% and therefore marked the highest reading since June 2019, according to a flash estimate released by Eurostat on 7 January.