Marginal economic impact from the heatwave

Danske Research Team Danske Bank A/S

The summer heatwave is a negative supply shock for the euro area economy, but the size of the shock is small. We expect euro area Q3 GDP growth to be reduced by 0.1pp, mainly due to weaker German growth linked to low Rhine River water levels. We expect only a marginal impact on prices. ECB communication to stay hawkish supported by the shock.

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Danske Research Team

Danske Bank A/S

Research is part of Danske Bank Markets and operate as Danske Bank's research department. The department monitors financial markets and economic trends of relevance to Danske Bank Markets and its clients.

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