important events
Today's economic indicators outside the euro area reportedly show an improvement in the situation. Daniele Antonucci chief investment officer Quintet Private Bank:
Looking at year-over-year changes, Beat vs. Consensus has outperformed forecasters' highest predictions in major polls.
This is a half-baked story, especially after the shallow recession the region experienced in the second half of last year, but it must be noted that consumer spending in many European countries remains very weak.
The glass-half-empty story is that the pace of growth remains fairly anemic, as forward-looking indicators suggest that economic conditions are reasonably good. The contrast is stark with the United States, where domestic demand is showing resilience and GDP growth appears to be accelerating again.
This is important when considering the overall economic outlook based on incoming inflation data. In the United States, inflation has been surprisingly up recently. In the euro area, today's data shows a flat trajectory for overall inflation, in line with expectations and lower in absolute terms than in the US.
ING: Eurozone benefits from stable energy supply
A quarterly growth rate of 0.3% is not necessarily impressive, but it is the highest quarterly growth rate in the euro area since the early days of the European energy crisis in the third quarter of 2022.
Bert Collin, ING A senior eurozone economist said the eurozone economy has entered a clearly positive phase with economic recovery, low unemployment and more moderate inflation.
The economy is supported by falling energy prices, which followed a spike in oil and gas prices following Russia's 2022 invasion of Ukraine.
Colin I will explain:
The economy benefits from a more stable energy supply, significantly easing costs and resulting in lower inflation rates. Second, wage growth accelerated to compensate for lost purchasing power, now benefiting consumers.
Although the details are not yet known, judging from the situation in France, it appears that household consumption is the driving force.
CEBR: The euro area has turned a corner
Eurozone expected to grow faster this year than in 2023 Sam Miley Managing Economist Economic and Business Research Center:
This morning's confirmation of first-quarter quarterly growth marks an end to a brief recession in the euro area, with the economy turning the corner from early 2024.
The outlook is likely to improve further throughout the year due to expectations for rate cuts. Further figures released this morning showed that inflation remained within 1 percentage point of target for the seventh month in a row, creating the right environment for the European Central Bank to consider introducing accommodative monetary policy. It was suggested that it was in place.
These policy changes should support growth this year. Cebr expects the eurozone economy to grow by 0.6% in 2024, faster than the 0.4% growth in 2023.
He says the eurozone economy is 'progressing well'. Neil Birrell chief investment officer Premier Mitten Investors, In response to today's GDP data.
Inflation in the euro area has progressed as expected, but has turned out to be stronger than expected, reflecting the experience of other regions. But the economy is doing well, which overall means the ECB could be on track to be the first major central bank to press the “cut” button on interest rates, possibly in June.
As doubts creep into the outlook for other countries, the outlook for the eurozone is improving.
Signs of further recovery in the euro area:
Q1 GDP +0.3% QoQ vs. 0% Q4 2023
CPI exceeds expectations by 2.7%USD outperformance keeps EUR/USD below 1.0750 pic.twitter.com/xhnJ8FjRyj
— Fiona Cincotta City Index (@FionaCityIndex) April 30, 2024
Here it is Mohamed El-ErianChief Economic Advisor of allianzfor today's Eurozone data:
Macro data just released #Eurozone include:
Headline inflation was in line with consensus expectations of 2.4%.
Core a little hotter than expected #inflation 2.7%.and
Slightly strong #growth.
Both should not change policy expectations for the world. @ECB.— Mohamed A. Elianm (@elianm) April 30, 2024
Eurozone inflation rate remains at 2.4%
Eurozone-wide inflation was unchanged in April.
Eurostat reported consumer price inflation at an annual rate of 2.4%, in line with the March reading.
Inflation in services slowed to 3.7% from 4% in March, while inflation in food, alcohol and tobacco rose to 2.8% from 2.6%.
Non-energy industrial product prices rose 0.9%, down from a 1.1% rise.
However, energy was less affected by deflation, with prices falling 0.6% year-on-year, down from -1.8% in March.
Unfortunately, core inflation did not fall as much as expected. Inflation, which excludes energy, food, alcohol and tobacco, fell to an annual rate of 2.7% in April, down from 2.9% but ahead of expectations for an even sharper decline to 2.6%.
Eurozone emerges from recession
Newsflash: Eurozone emerges from recession and outperforms growth forecasts earlier this year.
According to a report by the statistics agency Eurostat, the eurozone's overall GDP expanded by 0.3% in the January-March period.
This means the eurozone's shallow recession is over, with GDP contracting by 0.1% in both the third and fourth quarters of last year, a technical recession.
Growth in the euro zone is being held back by high interest rates as the cost of living crisis hits consumer spending while the European Central Bank fights inflation.
Eurozone GDP was boosted by better-than-expected growth in Germany, France, Italy and Spain (as I blogged about earlier this morning).
The European Union (EU) as a whole also grew by 0.3%.
Eurostat says:
Ireland (+1.1%) recorded the highest growth compared to the previous quarter, followed by latvia, Lithuania and Hungary (all +0.8%).
Sweden (-0.1%) was the only Member State to record a decrease compared to the previous quarter. Year-on-year growth rates were positive in nine countries and negative in four.
France The economy is off to a good start, reporting growth of 0.2%, which was praised by the economy minister. Spain It recorded an astonishing growth of 0.7%. Germany Since then, it has grown by 0.2%, matching France, and Italy expanded its GDP by 0.3%.
UK mortgage approvals hit 18-month high
Mortgage approvals in the UK are at their highest level since Liz Truss's mini-budget mess.
New data from the Bank of England shows 61,300 lender approvals were approved in March, up from 60,500 in February and the highest total since September 2022.
There was also some relief for borrowers. The “effective” interest rate (the interest rate actually paid) on new mortgages fell by 17 basis points to 4.73% in March.
March 2024 saw a significant move up the ladder as the effective interest rate fell by 17 basis points to 4.73%. 61,300 people applied for approval, an increase of 800 on February 24, the highest net approvals since September 2022. Net approval number… pic.twitter.com/NJa1fP9Nrk
— Emma Fildes (@emmafildes) April 30, 2024
Back to Eurozone GDP…and Portugal It has been growing at a steady pace since the beginning of this year.
Portuguese GDP growth in the first quarter of 2024 was 0.7%, the same growth rate as in the fourth quarter of 2023, and up 1.4% year-on-year.
Early this month, Portuguese The new centre-right government has predicted economic growth of 1.5% in 2024. Plans to cut taxes for the middle class to encourage growth and investment.
German sportswear brand Adidas benefited from increased sales in Europe and China, helping it overcome the economic downturn in the United States.
According to Adidas, Europe It was up 14% last quarter, compared to 8% last quarter. greater Chinabut decreased by 4% North America.
adidas CEO Bjorn Gulden reported that sales, gross profit and operating profit all exceeded expectations, and warned that “the market remains volatile and not easy.”
gulden addition:
We are now looking forward to celebrating great sporting events such as Euro 2024, Copa America, the Olympics and Paralympics. This is a great year for sports. Let's all have fun!
