In one line: Still pointing to underlying weakness in construction.
Melanie Debono (Senior Eurozone Economist)Eurozone
- House prices rose by around 3.5% in 2024, much stronger than we were anticipating…
- …A recovery in demand and still-subdued supply point to a further pick-up, supporting consumption.
- German industry ended 2024 on a better note than we expected, according to advance turnover data.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Swiss GDP likely rose by 0.9% in 2024, much better than the 0.2% decline in neighbouring Germany.
- The US has not said it will raise tariffs on Swiss imports, but an EU-US trade tiff will still hurt slightly.
- We continue to think the SNB easing cycle will end in March, though risks are tilted towards further easing.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Likely underestimating Swiss GDP growth still, and pointing to weaker inflation.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Spanish retail was on fire in December.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: No signal on the level of the neutral rate.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Spanish GDP rose by 0.8% q/q in Q4, and by 3.2% over 2024 as a whole, beating expectations.
- Growth will likely slow this year but remain stellar, such that Spain outperforms the big three, again.
- The IESI suggests Italian GDP growth will remain decent in Q1, after likely rebounding in Q4.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Political uncertain forces banks to tighten lending standards again.
Melanie Debono (Senior Eurozone Economist)Eurozone
- High gas prices and low inventories in the EU risk higher Eurozone inflation in Q2 and Q3.
- Russian gas imports will likely dwindle further; the US, Norway and Qatar can cover some of the gap…
- ...But at what price? And what will happen if Chinese or domestic US demand ramps up?
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Up marginally, supporting our view of a modest rebound in Q1.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Up, supporting our call for faster GDP growth in early 2025, but not enough to deter an ECB rate cut next week.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Our baseline assumes a mild US tariff rate increase and therefore limited impact on EZ exports and GDP.
- If the US raises tariffs on all goods apart from EU goods, GDP could rise by twice as much this year.
- A big universal tariff increase instead could see a Eurozone recession and GDP falling by 1% or so.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Falling back but still consistent with a supra-50 EZ composite PMI.
Melanie Debono (Senior Eurozone Economist)Eurozone
In one line: Construction supported growth in Q4.
Melanie Debono (Senior Eurozone Economist)Eurozone
- Weak capex and declining private consumption raise alarms for Mexico’s near-term economic outlook.
- Potential tariff threats and trade negotiations could complicate economic ties between US and Mexico.
- Ongoing reforms and budget deficits will hinder Mexico’s economic flexibility and growth prospects.
Melanie Debono (Senior Eurozone Economist)Eurozone
