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
Please use the filters on the right to search for a specific date or topic.
Daily Monitor Global Weekly Monitor Melanie Debono (Senior Eurozone Economist)
- It’s a close call, but we think the SNB will hold fire at today’s meeting and first cut in June instead.
- Risks are tilted towards a rate cut today; markets are pricing in 40% probability of a move.
- mItalian industrial production started the year on a weak footing, but EZ construction is holding up.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Hourly labour cost growth took a leg down in Q4, in line with other wage growth measures.
- Leading indicators suggest pay growth is easing again in Q1; we look for it to fall throughout 2024.
- The ECB can’t afford to wait for the all clear from wage negotiations to start easing policy.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Interest-rate and core-inflation differentials still point to upside risks for EURUSD.
- We continue to believe EURUSD is good value below 1.10; a rise to 1.15 should be possible.
- Spain will continue to outperform despite the government ditching its attempt to set a budget.
Melanie Debono (Senior Eurozone Economist)Eurozone
- The BTP-Bund spread has fallen, in line with our call; we still believe it will hit 100bp by year-end.
- Will the attractive carry maintain foreign investor appetite for BTPs in 2024? We think so.
- Assuming no fiscal disasters, BTPs will continue to close the gap to their Spanish counterparts.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Quarter-to-quarter GDP growth in Italy will pick up pace this year, despite falling investment...
- ...But our forecasts still point to GDP rising by just 1.0% this year, the same as last year.
- The risks to our call are a bigger fall in capex than we expect, and a smaller increase in consumption.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Swiss inflation edged down in February; it has been in line with the SNB’s target for eight months.
- It fell less than we expected; we are pushing out our forecast for the first SNB rate cut to June.
- The changing of the guard at the SNB in September won’t alter the outlook for monetary policy.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Consumer inflation expectations still point to lower inflation, despite uptick in the ECB’s January survey.
- Firms’ surveyed expectations are still generally on a downtrend, and market measures have also fallen.
- We still think a downgrade in the ECB’s inflation forecasts next week will be enough for an April cut, just.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Money and credit data continue to signal a rise in savings and little in the way of new lending.
- We still think rising real income growth is now lifting spending, but the rebound will be lacklustre overall.
- Consumer confidence data remains subdued in Germany and France but should bounce back soon.
Melanie Debono (Senior Eurozone Economist)Eurozone
- The inventory cycle in France likely bottomed out in Q4; total capital formation should rebound in H1...
- ...But surveys warn that growth in otherwise resilient services investment is now rolling over.
- A drop in auto sales will weigh on consumption in 2024, but rising real income growth will dominate.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Russia now accounts for just 15% of EZ gas imports, down from 45% before its invasion of Ukraine.
- Oil imports from Russia have slumped but are likely still entering Europe after being refined elsewhere.
- Non-energy trade has shrunk and will dissipate further this year, as the latest EU sanctions hit.
Melanie Debono (Senior Eurozone Economist)Eurozone
- EZ GDP growth is falling behind the US; relatively sluggish productivity is part of the reason.
- The inflation shock has depressed EZ labour productivity, but it should now be rebounding.
- Our interest rate forecasts are consistent with a relative shift in the EZ inflation and policy regime.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Eurozone GDP was flat in Q4, and we doubt the picture will improve in the first quarter.
- Investment will remain under pressure in H1, but consumers’ spending should now be rebounding.
- EZ employment growth is still outpacing the surveys; unemployment is pinned at a record low.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Swiss inflation fell sharply in January, beneath our below-consensus forecast...
- ...We are sticking to our call that the SNB will first cut its key policy rate in March, by 25bp to 1.50%.
- It will likely follow this up with 75bp-worth of cuts, split between 50bp in June and 25bp in September.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Swiss GDP likely fell in Q4 last year; it will recover this year as real disposable income growth rebounds.
- But base effects mean GDP growth will slow to 0.7% this year, from 1.2% last year.
- Inflation will stay low, the SNB will match ECB cuts to starve off CHF appreciation.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Advance GDP data show the EZ economy barely budged last year.
- Spanish inflation rose in January; we see no reason to alter our French and German calls in response...
- ...But we are revising up our EZ inflation forecast by 0.1pp to 2.4%.
Melanie Debono (Senior Eurozone Economist)Eurozone
- ECB hawks will pounce on signs from the PMI of continued upward price pressures in services...
- ...But the PMIs continue to suggest the EZ economy remains in a rut & manufacturing costs are sliding.
- January’s inflation read will be more decisive for the timing of the ECB’s first rate cut; March is our call.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Lending standards were tightened again in Q4, albeit less than in Q3; banks blamed risk perception.
- Demand for loans again fell across the board, partly reflecting the continued rise in interest rates.
- ECB doves can use the BLS to argue that financial conditions can ease, but will they?
Melanie Debono (Senior Eurozone Economist)Eurozone
- The fall in EZ residential house prices was extended in Q3, and likely again in Q4.
- In 2024, house prices should recover somewhat as demand rebounds, but not until the end of the year.
- We look for house prices to fall by 3.5% this year after a likely near-2% decline in 2023.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Italian industrial output fell in November, defying the otherwise decent trail of hard data for Q4.
- We are sticking to our call for a 0.2% slide in GDP, setting up a weak base for this year.
- Quarter-on-quarter GDP growth will rebound this year, but the recovery will be gradual and tepid.
Melanie Debono (Senior Eurozone Economist)Eurozone
- The small increase in Swiss inflation in December leaves it in line with the SNB’s target...
- ...Inflation will fall back soon, despite the VAT hike; we look for the Bank to cut its policy rate in March.
- EZ unemployment will rise, though only marginally; still-low joblessness need not deter ECB rate cuts.
Melanie Debono (Senior Eurozone Economist)Eurozone