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3 Apr 2013
Forex Flash: European outlook remains gloomy - Societe Generale
FXstreet.com (Barcelona) - Kit Juckes, Global Head of Currency Strategy at Societe Generale notes that gloomy activity data has continued this week with the release of the Manufacturing PMI data on Tuesday and a jump in the February euro area unemployment rate to 12%.
He sees that apart from Germany and a few other countries, Europe is struggling to catch up with the recovery of global manufacturing activity. In his opinion, however, this backdrop is still not gloomy enough to trigger a rate cut from the ECB this week. He feels that the preliminary estimates of March German prices saw national CPI inflation decelerate further to 1.4% yoy, while HICP inflation remained stable at 1.8% yoy, slightly above his expectations. He writes, “However, we still expect the euro area HICP, due to be released on Wednesday, to print at 1.8% yoy.”
He sees that apart from Germany and a few other countries, Europe is struggling to catch up with the recovery of global manufacturing activity. In his opinion, however, this backdrop is still not gloomy enough to trigger a rate cut from the ECB this week. He feels that the preliminary estimates of March German prices saw national CPI inflation decelerate further to 1.4% yoy, while HICP inflation remained stable at 1.8% yoy, slightly above his expectations. He writes, “However, we still expect the euro area HICP, due to be released on Wednesday, to print at 1.8% yoy.”