MADRID | The Corner | The indicator of economic confidence of Spain stood at 104.2 points, a sharp rise of nine tenths in November, and its highest level since August 2007, Brussels reported. The upturn in confidence in the Southern EZ economy is explained by the observed improvement in the manufacturing sector, services and retail, while consumer confidence and construction deteriorated compared to October.
MADRID | The Corner | Trading trends in the Euro today are expected to be determined by the Euro-zone’s crucial CPI data. As happened yesterday with Spanish and German data, consumer prices are expected to do down in November, due to an energy prices drop. Will the European Central Bank feel any pressure to act? Then bad news could turn a blessing for financial markets.
ATHENS | By Jens Bastian via MacroPolis | According to its Wikipedia article, Waiting for Godot by Irish writer Samuel Beckett is an absurdist play, in which two characters, Vladimir and Estragon, wait endlessly and in vain for the arrival of someone named Godot. The current situation in Athens has remarkable similarities with this classic piece of European literature.
MADRID | The Corner | A few weeks ago, Italy’s PM aide said the country had an “atomic bomb” to revive the economy, meaning a massive tax cut primarily on low to middle range wages that would help to boost domestic demand. Indeed, Rome has seen better days: GDP is expected to shrink 0.4% this year, according to the latest European Commission forecasts, far from the 0.8% growth predicted by Rome just after Mr Renzi took office in February. Its industrial sector, a traditional backbone of the Italian economy, registered a 25pp output gap to the eurozone industry since 1999. Yet the current combination of loose monetary policy, lesser fiscal drag or even outright fiscal stimulus, improving credit conditions and a weaker exchange rate leave the country far from being the sick man of Europe, as some have said.
MADRID | The Corner | Oil prices continue to fall ahead of the much-awaited OPEC meeting today, which will start at 9:00GMT –a press conference will be held at 15:00GMT. Brent crude and WTI both fell to four-year lows on concerns that oil producers will not make the large supply cuts needed to contain the slide. Analysts at Barclays believe that with an absence of basing signals for WTI crude, the risk remains lower towards 70.76. Will the oil cartel react?
MADRID | By Sean Duffy | The latest economic outlook from the Organisation for Economic Co-operation and Development (OECD) forecasts a bleak outlook for Europe unless action is taken. The Corner asked Piritta Sorsa, Head of EU and Eurozone surveillance at the OECD about the increased sense of urgency, sovereign bond proposals and the necessity for consensus among Eurozone members.
MADRID | By Sean Duffy | The latest OECD report is increasingly urgent in tone, with Europe the centre of attention. With continued wrangling over in the EU about how best to proceed, the Paris based think-thank has had its say on the ECB’s monetary policy too.
BRUSSELS | By Alexandre Mato | The European Commission has finally launched its promised €315bn plan to revive the continents stagnating economy. With concerns abounding about creating more debt within Members States, Brussels has turned to financial engineering to fill the investment gap with a very modest €21bn. The aim of the Juncker plan is to ultimately produce 1.3 million new jobs over the next three years.
MADRID | The Corner | Berlin is sticking to a rigid budgetary policy, prioritizing a 2015 balanced budget instead of growth. And hard liners aren’t just willing to make any move. As German Finance Minister Wolfgang Schäuble defended on Tuesday during a budget debate in Parliament: “We are not in a recession. We are not in an economic crisis,” Schäuble said, “Our economy is almost working at normal capacity.” Germany narrowly avoided a recession in the third quarter, growing by 0.1 percent, thanks to a sharp rise in private consumption (0.7 percent quarter-on-quarter, the biggest rise in three years) that compensated the lack of investment.