Eurozone next week: GDP and inflation - Danske Bank
|Analysts from Danske Bank expect another strong eurozone GDP reading for Q4 17, due to be released on Tuesday.
Key Quotes:
“In the euro area, the GDP growth figures for Q4 17 are due for release on Tuesday. Growth was strong in the first three quarters of 2017, with the latest print for Q3 at 0.7% q/q. Both survey and activity indicators have pointed towards continued strong growth. Composite PMI averaged 57.2 in Q4 (up from 56.0 in Q3), unemployment has edged below 9% and industrial production has showed further expansion. Thus, we believe Q4 GDP growth will be reported as 0.6% q/q.
“On Wednesday, we expect HICP figures for January. Headline inflation has plateaued around 1.4-1.5% y/y in recent months but we expect it to fall temporarily to 1.1% in January due to energy price base effects but bounce back to the 1.4% level shortly after. However, we do not believe headline inflation will pick up significantly from 1.4% before 2019 despite higher expected energy price inflation. Wage growth remains subdued, so underlying inflation pressure is not strong enough to lift headline inflation towards the ECB’s 2% target just yet. Still, growth momentum is high enough to sustain core inflation above 1%, which we believe will be key for ECB if it ends the QE programme. We expect core inflation to be 1.0% in January.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.