020 7898 0500One of the key releases from the eurozone yesterday was the German ZEW economic sentiment which dropped by a whopping 14.1 points in October. The reading of -24.7 was much
worse than the -12 expected by the markets and is symptomatic of trade war fears and the effects of a hard Brexit on the eurozone economy. The ZEW index wasn’t much better in
the eurozone as a whole, as it fell to -19.4 to post the weakest reading since August 2012.
The balance of trade figures were also released and showed that the eurozone’s trade surplus decreased to €11.7 billion in August from €15.24 billion a year earlier. It is the
smallest trade surplus since January and could have an impact on the eurozone’s economy. We all know that 2017 was the eurozone’s year, but much of the economic growth was
reliant on trade, so now that there appears to be problems, the economy is likely to be affected.
Like the UK, today we will see the September inflation rate from the eurozone. Unlike the UK, it is expected to increase a little to 2.1% from 2% the previous period. If it
does, there is no cause for concern, as it will still be extremely close to the European Central Bank’s target rate of 2%. We will also see the construction output figures for
August, which are expected to drop quite a bit to 1.7% from 2.6% in the previous period.
