Europe Data Response Euro-zone Flash HICP (May) With headline and core inflation rising more than expected yet again, the case for exiting from negative interest rates promptly is now irrefutable. The ECB looks sure to confirm next week that it... 31st May 2022 · 2 mins read
Europe Data Response Germany and Spain Flash Inflation (May) German and Spanish inflation data for May provide more ammunition for those who will argue at next week’s monetary policy meeting that the ECB should exit negative interest rates promptly, rather than... 30th May 2022 · 2 mins read
Europe Data Response EC Survey (May) The EC Economic Sentiment Indicator for May was almost unchanged from April, well below its pre-Ukraine war level and consistent with economic activity stagnating in Q2. The survey also suggests that... 30th May 2022 · 2 mins read
Europe Economics Weekly Struggling economy will not put ECB off 50bp hike Data released this week suggest that there are upside risks to our forecast for GDP to contract in Q2, but the economy still looks set to perform very poorly this year. And we doubt that this weak... 27th May 2022 · 9 mins read
Europe Economics Update PEPP redemptions no substitute for spread-fighting tool The ECB’s guidance that it can use PEPP reinvestments to contain bond spreads has a few big limitations. If the forthcoming interest rate hikes cause spreads to blow out, the ECB will either need to... 26th May 2022 · 3 mins read
Europe Commercial Property Update Do recession risks threaten euro-zone rental growth? The risks of a recession in the euro-zone have risen. While we think a contraction will be narrowly avoided, this will remain a concern for property investors already facing the prospect of higher... 26th May 2022 · 3 mins read
Europe Economics Update ECB to follow Fed’s lead with 50bp hike With inflationary pressures remaining intense and policymakers keen to get the deposit rate out of negative territory, we now think the ECB is most likely to raise rates by 50bp in July and by 125bp... 26th May 2022 · 4 mins read
Europe Economics Update Answers to your questions on the ECB We held a Drop-In today to discuss our views on the ECB and what the chances are of a further hawkish surprise in the coming weeks. (You can see an on-demand recording here.) This Update answers... 24th May 2022 · 4 mins read
DM Markets Chart Pack More trouble may lie ahead for risky assets We think “risky” assets will continue to struggle over the next year or so, even if a recession is avoided in most major developed markets. 24th May 2022 · 8 mins read
Europe Economics Update Rising interest costs add to pressure on EZ households We estimate that euro-zone households’ debt interest payments will quadruple as a share of income over the next couple of years as the ECB raises its policy rate. This will put yet further strain on... 24th May 2022 · 4 mins read
Europe Data Response Euro-zone Flash PMIs (May) The small fall in the euro-zone Composite PMI in May suggests that activity is holding up better than we had feared. But the services rebound is likely to run out of steam amid high inflation and the... 24th May 2022 · 2 mins read
Europe Data Response German Ifo Survey (May) The Ifo survey for May suggests that activity in Germany may be holding up a little better than we had feared. But the headline Business Climate Index is still consistent with GDP contracting in year... 23rd May 2022 · 2 mins read
Europe Data Response Euro-zone Consumer Confidence (May) The small increase in euro-zone consumer confidence in May left it only slightly higher than its low point at the start of the pandemic. With confidence extremely low and real incomes squeezed by high... 20th May 2022 · 2 mins read
Europe Economics Weekly High inflation, record trade deficit Data released over the past week revealed that the euro-zone recorded its first monthly current account deficit since 2012 and provided further evidence that underlying price pressures are building... 20th May 2022 · 6 mins read
Europe Economics Update Historical experience highlights recession risks History suggests that the surge in energy prices over the past year means there is a good chance that the euro-zone will suffer a recession in 2022. It also suggests that it will be tricky for the ECB... 20th May 2022 · 4 mins read
Europe Economics Update End of negative rates is nigh! The account of the ECB’s April meeting shows that a lot of policymakers thought the criteria for rate hikes had already been met. Since then, the case for rate hikes has only strengthened. While not... 19th May 2022 · 3 mins read
