EURO ZONE

摘要

The Q3 national accounts confirmed that activity slowed from 0.4% (q-o-q) in H1 2018 to 0.2% in Q3, its slowest pace in four years. GDP was not helped by Germany contracting over the quarter (thanks to a slump in industry) and a decline in Italy. Consumption ebbed from 0.5% in Q1 to 0.2% in Q2 and 0.1 % in Q3, while investment slowed sharply from a 1.5% (q-o-q) surge in Q2 to a mere +0.2%. Still, domestic demand contributed to growth, as did inventories; net trade, on the other hand, subtracted. The y-o-y Euro zone growth rate also decelerated, from 2.2% in Q2 to 1.6%. Not surprisingly, sentiment has worsened (see chart, bottom) especially in light of Italian budget wrangling, protests in France over economic conditions, and ongoing world trade uncertainty. Alongside disappointing growth, headline and core inflations have been muted at best. Core CPI rose by a negligeable 0.1% (m-o-m) in October while the y-o-y rate has hovered between 0.9-1.1% since May. Despite the weaker outlook, the ECB announced the end of its net asset purchase programme (QE) at its December 13 meeting. It did adopt a more cautious tone over the economic outlook, though.