Eurozone

  1. Eurozone inflation slows as oil prices fall

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    Consumer prices in the eurozone grew more slowly in February as oil prices fell amid the spread of the coronavirus.

    The latest figures from Eurostat showed the annual rate of inflation in the eurozone fell to 1.2% last month, down from 1.4% in January.

    The slowdown was mainly due to a 0.3% year-on-year fall in energy prices.

    Eurostat figures also showed that the eurozone's unemployment rate remained unchanged at 7.4% in January.

  2. Eurozone growth lukewarm as France and Italy shrink

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    Eurozone GDP growth slowed to 0.1% quarter-on-quarter in the last three months of 2019, dragged down by France and Italy.

    The EU's statistics office, Eurostat, said growth for the period in the 19-country area was 0.9% year-on-year, a downward revision from the previously estimated 1% growth.

    The quarterly growth rate was down from the 0.3% expansion seen in the third quarter because of a 0.1% contraction in the second-biggest economy, France, and a 0.3% contraction in the third-biggest, Italy.

    As we told you earlier, German growth stagnated.

  3. EU growth numbers fail to climb

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    Eurozone GDP numbers slowed in 2019.

    Uncertainty from Brexit negotiations and the Trump trade drama had a knock on effect on the 19-member single currency zone which grew 1.2% percent over the year.

    It is a sharp 1.8% drop from 2018 and a plunge from the 2.7% growth reported in 2017.

    Inflation numbers rose a percentage point to 1.4% in the fourth quarter of 2019.

  4. Eurozone manufacturing and services output 'stable'

    The latest PMI surveys for the Eurozone show that manufacturing and services output growth remained stable and at a modest pace in January, with IHS Markit's Eurozone Composite Flash Purchasing Managers' Index (PMI) remaining unchanged at 50.9.

    IHS Markit said that France and Germany's economies were both seeing a recovery with combined output growth at a five-month high, but in other countries growth of business activity slowing to near-stagnation.

    However business confidence across the single-currency area jumped to a 16-month high.

    “Overall, a stable picture for both growth and inflation will likely reassure the European Central Bank that they are safe to keep monetary policy fixed for now while carrying out a strategy review," said IHS Markit's associate director Andrew Harker.

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  5. ECB review 'won't be revolutionary'

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    According to Melissa Davies, an economist at British financial broker Redburn, the European Central Bank's strategic review is likely to be will be wide-ranging in nature, but perhaps limited in output.

    “Inflation remains the main focus and we don't expect anything revolutionary in terms of targets, although the nod to employment suggests a perhaps more US-style dual mandate in future," she said.

    “The operating framework has already been changed radically, with scope for further innovation. Environmental concerns could provide a 'wrapper' for further change, including the greening of collateral and quantitative easing assets.”

  6. How the ECB will operate this year

    While the European Central Bank conducts a strategic review of its monetary policy, Ms Lagarde said that the current strategy and inflation target of less than 2% will remain in place.

    It is predicted that Eurozone growth will likely to stay the same as now in the next few months, according EY Item Club's Howard Archer.

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  7. Eurozone economy 'stuck in crawler gear'

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    While the latest PMI surveys for the UK indicated both the services and manufacturing sectors contracting in December, the news from the eurozone isn't that much better.

    IHS Markit's eurozone Composite Flash Purchasing Managers' Index (PMI), remained unchanged at 50.6 in December. That's just above the 50 mark which separates expansion from contraction.

    “The eurozone economy closes out 2019 mired in its worst spell since 2013, with businesses struggling against the headwinds of near-stagnant demand and gloomy prospects for the year ahead," said Chris Williamson, chief business economist at IHS Markit.

    “The economy has been stuck in crawler gear for fourth straight months, with the PMI indicative of GDP growing at a quarterly rate of just 0.1%.

    “There are scant signs of any imminent improvement. New order growth remains largely stalled and job creation has almost ground to a halt, down to its lowest for over five years as companies seek to reduce overheads in the weak trading environment and uncertain outlook."