In one line: Holding at a 46-month low, but will rise again soon; Swiss retaliation to US tariff hikes poses an upside risk.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Look through the noise to see a relatively modest US tariff package for the EU, all things considered.
- An ECB rate cut later this month is now fully priced in, but we still think the Bank will hold fire.
- The SNB can hold off from further rate cuts for now, despite the likely hit to growth from the US tariff hike.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Soft enough for an April cut? We don’t think so.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: A new record low; another data point for ECB hawks.
Melanie Debono (Senior Eurozone Economist)Eurozone
- The euro area economy comes into ‘Liberation Day’ in a relatively good position.
- A 25% blanket tariff on EZ exports to the US would bring down our 2025 growth forecast by 0.4pp.
- EU retaliation could raise EZ core goods inflation, but it depends on the size and scope of import tariffs.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Our PM composite PMI points to another solid increase in GDP in Q1.
Melanie Debono (Senior Eurozone Economist)Eurozone
- We still think the data support the idea of an ECB pause in April, but what will happen on tariffs today?
- EZ core inflation fell nicely in March, but it will snap back in April as Easter effects reverse.
- Services activity in Switzerland is coming off the boil at the start of the year.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: We now see the March EZ HICP up by 0.7% m/m, and by 2.2% y/y.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- We think EZ headline and core inflation fell by 0.1pp in March, to 2.2% and 2.5% respectively.
- Easter effects depressed German services inflation in March, but core goods inflation in Italy jumped.
- German retail sales were stronger at the start of 2025 than we expected; upside risk to Q1 growth?
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Headline in line with consensus; core looks strong considering Easter effects.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Great, but leading indicators point to a slowdown.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Still averaged higher in Q1 than Q4.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: EZ inflation expectations hold steady; further increases in German unemployment are on the way.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Inflation in France and Spain came in below expectations; another setback in French spending.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Election result does little to lift household sentiment.
Claus Vistesen (Chief Eurozone Economist)Eurozone
- French and Spanish inflation came in weaker than expected in March, and German joblessness rose...
- ...But consumer inflation expectations and selling price expectations are up and money supply firmed.
- The April decision by the ECB is now finely poised; a dovish March HICP could swing it for the doves.
Claus Vistesen (Chief Eurozone Economist)Eurozone
In one line: Money and credit data still positive on outlook for EZ economy.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Back up, but increase in Q1 will be smaller than in Q4.
Melanie Debono (Senior Eurozone Economist)Eurozone
THE ECB HAS ONLY ONE MORE CUT IN IT...
- ...ASSUMING JUST SMALL US TRADE-TARIFF INCREASES
Melanie Debono (Senior Eurozone Economist)Eurozone
