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· Growing signs of some pick-up in activity in Q3, but falling construction output and retail sales and rising unemployment continue to act as a brake on recovery.
· 'Core' inflation continues to drift down but negative 'headline' inflation nearly eliminated in October and fall in factory gate prices levels off as external cost pressures persist.
· Money and credit growth continues to fall away, with annual rate of credit growth to corporations and to households now both negative.
· EZA still sees ECB remaining in wait-and-see mode through first half of 2010, but on the alert for signs of economic upturn and inflation threats, with gradual unwinding of special credit measures and cautious raising of official interest rates likely from mid-year.
Please see attached our regular 6 page ECB Council preview from John Arrowsmith as a pdf to read onscreen or simply print.
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John Arrowsmith: ECB / Regulatory
Tel: +44 7720 59 1726
john.arrowsmith@eurozoneadvisors.com
Discussion Partners
John Arrowsmith: ECB / Regulatory
Tel: +44 7720 59 1726
john.arrowsmith@eurozoneadvisors.com
Dr Michael Clauss: Germany Politics / Economy / Equities Sectoral Analysis
Tel: +49 89 64254046
michael.clauss@eurozoneadvisors.com