Promising 2026 expected for Eurozone economy as data improves
|Germany’s economy finally appears to have turned a corner following two years in the doldrums. Europe’s largest economy expanded by 0.2% in 2025 according to yesterday’s full-year growth figures, snapping a couple of years of outright contraction.
While not exactly stellar, 2026 bodes to be significantly better, with the country’s huge infrastructure spending programme likely to provide a material boost to employment, investment and consumer spending this year - last week’s encouraging factory output figures suggest that we are finally beginning to see this reflected in activity data.
The Euro continues to trade on developments elsewhere, however, with the EUR/USD pair briefly dipping below the 1.16 level on the dollar following yesterday’s strong US jobs figures.
German inflation data won’t rock the boat this morning. Focus next week will be on the January PMI figures and the release of the latest ECB meeting accounts.
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