-Poor data week for Eurozone
In the Eurozone last week, the European Central Bank's (ECB) monetary policy meeting minutes, investor confidence index and industrial production data were released and followed.
The ECB signaled concern over a trade war with the U.S. while investor confidence and industrial production declined.
European Central Bank policymakers, who gathered last month, raised concerns over risks due to a possible trade war with the U.S. and fretted over the potential negative impact on the euro’s strength, the minutes of the meeting in March showed.
Since the Governing Council’s monetary policy meeting on Jan. 24-25, 2018, the minutes showed that “despite a short-lived and concentrated spike in market volatility, valuations across broad asset classes remained consistent with continued optimism for global growth.”
“It was remarked that the recent movements in the euro exchange rate seemed to relate more to the relative monetary policy shocks, including communication, and less to improvements in the macroeconomic outlook,” the minutes showed.
However, German market research firm Sentix contends that the period of optimism in the euro area is coming to an end. The overall index fell by 4.4 points to 19.6 index points.
This third consecutive decline is due to significant deterioration in economic expectations, which fell by 5.8 points and are negative again for the first time since July 2016.
The first mover among the leading indicators again points to an economic slowdown at a very early stage.
The negative trend also continued in industrial production. In February 2018 compared with January 2018, seasonally adjusted industrial production fell by 0.8 percent in the euro area and by 0.7 percent in the EU, according to estimates from Eurostat, the statistical office of the European Union.
In February 2018 compared with February 2017, industrial production increased by 2.9 percent in the euro area and by 3.1 percent in the EU.
- The week ahead
This week the most important data for the Eurozone will be annual inflation. Additionally, investors will closely monitor the 2018 Spring Meetings of the World Bank Group and the International Monetary Fund in Washington.
