020 7898 0500There has been a surprising number of disappointing economic data releases in the eurozone this week. While the figures have all come in pretty strong, many of them have come in below what was expected and yesterday offered more of the same with the German Ifo business climate index.
It had been expected to drop slightly, from 117.6 to 117.1, but the figure came in at 115.4 – the lowest reading since June 2017. Overall, sentiment deteriorate in the manufacturing, construction, wholesale and retail industries.
The other notable release was the minutes from the European Central Bank’s January meeting. They showed that policymakers rejected even a token change in the bank’s policy message. The argument was that weak inflation means that signalling policy normalisation now would be premature. It will be curious to see whether this mindset changes and, if so, when.
Today we will see the eurozone’s inflation rate on a monthly and annual basis. Year-on-year, it is expected to dip to 1.3% from 1.4%.
