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Economy minister de Guindos

Spanish economy 26th August 2014

Merkel supports Luis de Guindos to be the next President of the Eurogroup

MADRID |The Corner | After a meeting between Mariano Rajoy and Angela Merkel in Santiago de Compostela, the German chancellor gave her support to the candidature of the Spanish Economy Minister, Luis de Guindos, to succeed Jeroen Dijsselbloem as President of the Eurogroup. As Barclays analysts comment, “with Italy’s and France’s leftwing governments and UK in or out of the EU, Spain is now a more attractive partner.” Regarding Germany, Angela Merkel recognised that the crisis in Ukraine is damaging the German economy. Nevertheless, Merkel affirmed that she forecasts a good annual growth if nothing dramatic happens.

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In Europe 25th August 2014

Draghi’s speech marks a turning point in ECB rhetoric

MADRID | The Corner | Although it is not part of ECB’s mandate, last Friday in Jackson Hole, President Mario Draghi spoke about what needs to be done in the euro area to address the problem of high unemployment and weak economic growth. As Barclays analysts believe, the speech “represented a significant breakthrough in the ECB rhetoric and will probably have significant implications regarding the debate just about to start between European government on policies that need to be deployed to avoid a ‘triple-dip recession’ and a fall in outright deflation.”

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In Europe 22nd August 2014

ECB might wait to take further action

Madrid | The Corner | Despite last bad figures of the Eurozone economy, European stock markets are rising on expectations of ECB further action. However, it seems that ECB will wait to see if the actions taken until now and the TLTROs of September and December will take effect. Meanwhile, both Barclays and UBS analysts trust in these measures to support European recovery.

Greece's return

In Europe 19th August 2014

The challenge in Greece: Funding an emerging economic recovery

ATHENS | By Jens Bastian via Macropolis | A fragile, uneven and weak recovery is gradually manifesting itself in the real economy of Greece. The recent data published by ELSTAT for the first two quarters of GDP performance in 2014 suggests that Greece is on course to register its first quarterly GDP level in positive territory in the third quarter this year.
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In Europe 19th August 2014

Bundesbank: the economy has not changed direction

BERLIN | Alberto Lozano | After the strong performance of the German stock market yesterday, one of the hardest hit in recent weeks by the greater exposure of its companies to the Russian market, Bundesbank president Jens Weidmann expressed his confidence in the growth of the German economy and the euro area during the second half of the year after the paralysis of the second quarter. In fact, Bundesbank considers that the “accumulation of bad news” is responsible of the decline in the 2Q, what could change the spring forecasts, although the basic trend suggests a strengthening in the second half of the year. Moreover, the Bundesbank wanted to make clear that although “the sentiment has deteriorated from a high level, the fact that the trend for domestic demand continues basically high suggests the economy has not changed direction.”

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Markets 18th August 2014

Markets welcome Eurozone economic ‘bad news’

MADRID | By J. J. Fdez-Figares (LINK) | Stock markets face today a new week in which geopolitical conflicts, especially in Ukraine, and macroeconomic data that will be announced during the day will monopolize the attention of investors. Although we expect trading volumes remain low, typical of summer dates, we do expect a slight rise in volatility, especially given the current stage of confusion, both in the geopolitical and economic environment that financial markets are facing.

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In Europe 15th August 2014

ECB under pressure, markets demand QE policy

MADRID | The Corner | The European weak economic growth increases the pressure on the ECB to take additional measures or the long-awaited QE to boost growth, beyond those already announced in June and of which the effects probably will not be seen until 2015. At the moment the ECB in its monthly report reemphasized that there is “a continued moderate and uneven recovery of the euro area economy”, with low inflation rates and a weak monetary and credit evolution. At the same time, inflation expectations for the euro area in the medium and long term remain firmly anchored in line with the ECB’s target of keeping the inflation rates at levels below but close to 2%.

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Spanish economy 14th August 2014

Spain’s growth beats its EZ larger peers in the 2Q

MADRID | The Corner | Spain’s GDP expanded by 0.6% in the 2Q of 2014 over the previous quarter, the fastest pace in the Eurozone after Latvia’s growth (+1%). With Portugal (+0.6%) and Netherlands (+0.5%), Spain becomes one of the best economic performers in the eurozone during this quarter. Moreover, according to the figures published today by Eurostat, the Euro area has stalled in the 2Q, especially as a result of the contraction of Germany, the Italian fall into recession and France’s stagnation. Meanwhile, the Greek economy contracted by 0.2%, the lowest drop since 3Q 2008 and it could show that the country is meeting its full year growth target of 0.6% for 2014.