Eurozone Chartbook: Slippery growth seeks fiscal support
- High-frequency data continue to weaken
- The European Central Bank was ahead-of-the-curve to ease policy
- Push for fiscal policy to take a growth-supportive stance is rising
- Impact of policy easing is evident in a weak currency, but does little for real activity
- We trim 2019 and 2020 Eurozone growth forecasts
• High-frequency data continue to weaken, led by sluggish trade and manufacturing activity
• Germany is at the cusp of a technical recession in 3Q19, hurt by a tough global environment and structural weakness in key sectors
• We trim 2019 and 2020 Eurozone growth forecasts
• The European Central Bank was ahead-of-the-curve to ease policy and more is likely as external risks (Brexit, trade wars etc.) are eyed. New ECB Chief takes over in November
• Impact of policy easing is evident in a weak currency, but does little for real activity
• Push for fiscal policy to take a growth-supportive stance is rising
• Restart of asset purchases bode well for Eurozone bond yields
• EUR is expected to weaken vs the USD
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