Germany
The German auto and components sector is under stress. Year-to-date, the sector’s equity prices have declined by 3.5% relative to the broader German market, and multiple indicators suggest that further challenges lie ahead. One significant concern is the…
Results of the ZEW survey of investor sentiment delivered a mixed signal on Tuesday. On the positive side, the indicator of economic sentiment for Germany unexpectedly ticked up from -12.3 to -11.4, surprising expectation of a further deterioration to…
Euro Area inflation data surprised to the upside on Wednesday. According to preliminary data, although Germany’s harmonized headline CPI inflation rate fell from 6.5% y/y to 6.4% y/y in August, it nevertheless came in above consensus estimates calling for…
Germany’s IFO survey sent a downbeat message on Friday. The headline Business Climate Index fell by 1.7 points to 85.7, below expectations of 86.8 and near the 85.2 level at which it bottomed in October. A 2.4-point decline in the Current Assessment…
August PMI Data Supports European Bond Outperformance Vs. USTs & JGBs
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According to BCA Research’s European Investment Strategy service, German yields are unlikely to experience a decisive break out that would carry them to 3%. Five economic forces suggest that German yields are unlikely to move meaningfully higher in the…
German producer prices indicate that inflationary pressures continue to moderate. The producer price index’s 6.0% y/y drop in July is more pronounced than the anticipated 5.1% y/y decline and marks the first annual decrease since November 2020 and the…
European yields are testing the upper end of their recent trading range. Is the European economic outlook consistent with an imminent breakout?
Tuesday’s German IFO survey corroborates the downbeat message from Monday’s flash PMI estimate highlighting weak economic conditions. The headline Business Climate Index dropped 1.3 points to 87.3 in July – its weakest level since November, and below…
Eurozone producer prices fell by more than anticipated in May. The -1.5% y/y decrease – which marked the first annual drop since December 2020 – was more pronounced than expectations of a -1.3% y/y decline and followed a downwardly revised 0.9% y/y increase…