European Economy


Europe’s good news, bad news

A few interesting development this week in the Eurozone. Firstly the good news… The latest sentiment surveys have followed the latest PMIs in a new uptrend showing strength across most sectors, excluding construction. In the euro area, the ESI’s increase was driven by improved confidence among consumers and managers in industry, services and retail trade. Only in


Eurozone credit turns a corner

ANZ has some nice charts in a note this morning covering this week’s ECB Bank Lending Survey. The worst is well over in credit availability: And there is some new demand as well: Leading to a reasonable prospect of a return to shallow growth in the second half: Looks like Europe will offer something to


Europe extends and pretends

As I’ve been covering over the last few months the data coming out of Europe of late has been slowly getting better, and last nights’ PMI continued the trend. Eurozone stabilises as PMI hits one-and-a-half year high Flash Eurozone PMI Composite Output Index at 50.4 (48.7 in June).18-month high. Flash Eurozone Services PMI Activity Index at 49.6


Iberian disintegration a familiar tale

As Greece goes on strike again , I’m reminded of just how long I’ve been covering the Eurozone crisis and how the underlying issues within the monetary union constantly bubble to the top, but are yet mostly unaddressed. For those who maybe new to the topic you can read my previous posts on the fundamental


Eurozone banking (un-)union

Overnight we saw some interesting action on the Single Resolution Mechanism for the Eurozone banking system. From the FAQ. The entry into force of the Single Resolution Mechanism and the Bank Recovery and Resolution Directive would mean that the shareholders and creditors accepted the losses of an ailing bank, just as in any other failing


Is Europe recovering?

Manufacturing and PMI Data out for Europe overnight and, much like the flash data, the news is getting better but with some serious caveats. Final Eurozone Manufacturing PMI at 16-month high of 48.8 in June (flash: 48.7) PMIs rise in all nations except Germany Price pressures ease further as input costs and output charges decline


More bank market manipulation

Cross-posted from Kate Mackenzie at FTAlphaville. The European Commission has been investigating goings-on in the CDS world since Deutsche Borse and CME tried to enter between 2006 and 2009. The commission today said it’s reached a preliminary conclusion that — deep breath — ISDA, Markit, Bank of America Merrill Lynch, Barclays, Bear Stearns, BNP Paribas,


Europe’s pain eases but…

Some more flash PMI data out of the Eurozone overnight and although the data continues to improve in terms of the rate of decline there is some worrying signs that not all is as good as the headline figures suggest. German data is at stall speed with weak future indicators. Marginal growth in output was recorded


Europe’s lie

Warning video starts automatically. Overnight the governing council of the ECB met and decided to leave all rates on hold. The press conference video and transcript are below. It was a standard performance from Draghi, talking up much of the weak data and talking through many major problems along with pushing his mandate by again


European recession eases

Some more slightly positive, yet mixed, news out of the Eurozone overnight with services and composite PMI readings for May. Final Eurozone Composite Output Index: 47.7 (Flash 47.7, April 46.9) Final Eurozone Services Business Activity Index: 47.2 (Flash 47.5, April 47.0) Germany ekes out marginal growth, while downturns ease in Spain and France The downturn


European recession eases

Manufacturing data was out in Europe overnight with again some upside: Final Eurozone Manufacturing PMI at 48.3 in May (flash:47.8) Downturns ease in all nations covered Price deflationary pressures remain, as input costs and output prices fall further The eurozone manufacturing downturn eased for the first time in four months in May. Moreover, all sub-indices


Unemployment driving European rethink

Another month goes by and once again unemployment in the Eurozone targets the moon: The euro area (EA17) seasonally-adjusted unemployment rate was 12.2% in April 2013, up from 12.1% in March. The EU27 unemployment rate was 11.0%, unchanged compared with the previous month. In both zones, rates have risen markedly compared with April 2012, when


Europe rethinking austerity?

As I noted yesterday, the chatter about Europe changing course on ‘austerity’ is growing, although as I stated although this appears to be positive step forward, I really think we need to wait until after September to get a handle on exactly what that means. The outcome of the German election is very likely to


Europe’s slow dawn

Back in December 2011 I stated that I thought the Eurozone had about 2 years of worsening economic data ahead of it before the situation became so bad that the zone would be forced to back away from the fiscal treaties they had just signed themselves up to. Slowly but surely that appears to be


IMF rethinks sovereign defaults, again

I noted back in January that the IMF had started to do its own “lessons learned” on its European financial crisis response and had begun to admit it had made some fairly terrible mistakes in its assessment of the debt sustainability of a number of nations, including Greece, under its current programs. Late last week


Europe plods on

Another round of PMI data from the Eurozone overnight and once again, even though there are some minor improvements, the data is still poor. PMI signals ongoing recession in second quarter, though downturn eases in May Flash Eurozone PMI Composite Output Index(1) at 47.7 (46.9 in April). Three-month high. Flash Eurozone Services PMI Activity Index(2)


Europe’s depression deepens

Not that it should be a surprise to most MB readers, but the economic data coming out of nations within the Eurozone is once again “worse than expected”. Last night it started with Italy: Italy’s economy contracted more than expected in the first quarter of 2013, shrinking 0.5% from the previous three months as activity


Germany pushes France toward periphery

You know, post June-2012, I genuinely thought we’d moved past the back and forth, chicken and egg arguments within the Eurozone, but alas, we are here again: German central bank head Jens Weidmann has strongly criticized French efforts to reduce its budget deficit, just days after the European Union granted Paris more time to meet


Eurozone manufacturing PMIs signal more misery

Back in November 2012 Mario Draghi had this to say when asked when the Eurozone would begin to emerge from the economic crisis that had been on-going for almost 3 years at that time. The Eurozone is expected to pull out of recession in the second half of 2013, European Central Bank President Mario Draghi


ECB furiously flaps its wings

Warning video will start immediately. At today’s ECB meeting, which was held in Bratislava, the Governing Council of the ECB took the following monetary policy decisions: The interest rate on the main refinancing operations of the Eurosystem will be decreased by 25 basis points to 0.50%, starting from the operation to be settled on 8


Europe’s depression worsens

As I mentioned earlier in the week Italy may have a new parliament but there is very familiar person who appears to be pulling the strings, and how long such an arrangement can last is questionable. Over the last couple of days Silvio Berlusconi has placed several demands on the new PM including a re-negotiation


France versus reality

Yesterday I noticed an interesting paragraph over at efxnews about France and its parallels with what many see in the market today: It’s a big surprise for some that France is high on the crisis susceptibility index because if you look at the market, their spreads are very narrow as the market treats France as


Bundesbank looks to undermine Italy

Another chapter in the Italy political story comes to a close as a government is formed, for how long who knows, but a familiar figure appears to be playing puppet master: Italian center-left politician Enrico Letta named a coalition government on Saturday, making one of Silvio Berlusconi’s closest allies deputy prime minister and ending two


If only Europe could sell unemployment

Another day, another round of atrocious data out of the Eurozone: Spain’s unemployment rate soared to a new record of 27.2% of the workforce in the first quarter of 2013, according to official figures. The total number of unemployed people in Spain has now passed the six million figure, although the rate of the increase