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inflation eurozone

In Europe 16th October 2014

Stimulus, bitte!

MADRID | The Corner | The eurozone’s inflation slipped in September to its lowest level since October 2009 (0.3%), raising fears of an eventual third recession in six years. Prices have been now been in the ECB’s “danger zone” of below 1% for 12 consecutive months. And yet Germany, the biggest economy in the EZ,  is torn between deficit control and growth, relieved with a weak euro helping its exports but worried about the same depreciation policy leading to less pressure to implement reforms in countries like France.

 

irlanda contenta TC

In Europe 14th October 2014

Dublin gets its house in order as bell tolls for “The Double Irish”

MADRID | By Sean Duffy | The Irish Government presented its budget on Tuesday, keen to present the announcement of its projections for the year 2015 as the successful consequence of prudent fiscal planning. Critics have pointed out that it is much of the same, yet with the economic picture improving, the Government has sought to offer a respite from austerity, whilst also attempting to address the outstanding concerns of its international partners.

industrial production

In Europe 14th October 2014

Poor EZ macro data raise odds for QEII

MADRID | The Corner | “Further evidence has emerged that the euro area recovery is at risk. We acknowledge that German data were distorted by technical factors… but we still think underlying momentum is fading in Germany,” Barclays’ François Cabau commented. And that means, for an increasingly number of experts, that the prospect of QE II is becoming more entrenched. Some believe it could happen before New Year.

 

OMT

In Europe 13th October 2014

EU: Challenged OMT is back in town

MADRID | The Corner | The European Central Bank’s Outright Monetary Transaction (OMT) will be back on the front pages on Tuesday. The European Court of Justice (the EU’s highest tribunal) will have to respond to the challenge of German judges, who said the OMT can be seen as monetary financing of governments, banned in  EU treaties. “Every time the monetary union takes a step forward, German individuals and/or civil or political groups file a case with the Constitutional Court in Karlsruhe,” our senior analyst Luis Martí commented.

renzi contento1 TC

In Europe 12th October 2014

How far will Italy’s labour reforms go?

MADRID | The Corner | Italian PM Matteo Renzi won the Parliament’s confidence vote on Italy’s labour reforms on Thursday, the most importan in his 8 months in the job. As the country’s economy has been stagnated for two decades, many wonder how far the center-left government’s plans will go. The current jobless rate of the eurozone’s third biggest economy is above 12% (44% youth unemployment). “Italy must reduce the proportion of workers on temporary contracts in the overall work force, but the details yet to be unveiled remain critical to assess whether it represents a true game-changer or not.” analysts at Barclays commented on Friday.

ejecutivos puente londres TC

In Europe 10th October 2014

UK: Reputation can’t be bought at the supermarket

LONDON | By Víctor Jiménez | We leave the Thameslink station, in the southern section of Ludgate Hill Street that leads to the door of St. Paul’s Cathedral in London. We are close to Square Mile. On our way to his office, the veteran financial journalist Jon Hay explains that Euromoney (one of the large market information publishing companies in Europe) has started to hire new reporters to cover, for instance, the latest data on the collateralised loan obligations (‘CLOs’), which are one of the debt structures that got deflated after the 2007 credit bubble burst. 

españa demanda domestica TC

In Europe 10th October 2014

Spanish domestic demand grows along with external deficit

BARCELONA | By Joan Tapia | The Spanish economy has come out of recession and citizens have begun to  notice, encouraged by a slight increase in employment creation (albeit temporary, part-time and minimum wage employment, but it at least entails an increase in those joining the workforce). Thus, the CIS’ Economic Confidence Indicator –which ranges from 0 and 100, recorded a low 35.7 (although it represents a 16% increase with respect to 2013). For its part, the Consumer Confidence indicator –which is different and ranges from 0 and 200- is at 89.3, 22% higher than the data from September 2013. The trend appears to point to an awakening of domestic demand.

labour markets

In Europe 9th October 2014

No jobs, no growth: Why the ECB’s last bulletin points to eurozone labour markets

MADRID | The Corner | Although employment is not in the central bank’s mandate, the European Central Bank’s October monthly bulletin focuses on the impact of the economic crisis on euro area labour markets. “Monetary policy is focused on maintaining price stability over the medium term and its accommodative stance contributes to supporting economic activity. However, in order to strengthen investment activity, job creation and potential growth, other policy areas need to contribute decisively.”