EURO ZONE

摘要

The Q2 national accounts confirmed that the pace of activity halved to 0.2% (q-o-q), from 0.4% in Q1, which left the y-o-y rate at 1.2%. Trade subtracted from GDP as the US-China trade war reverberated across global supply chains (especially for European companies with holdings in China or supplying components). The looming possibility of a no-deal Brexit is also hitting sentiment. August's services PMI was solid, but manufacturing remained in contraction. The ECB has cast a worried eye overtumbling long-term bond yields as well as CPI, which fell by -0.5% (m-o-m) in July, dragging the y-o-y rate down to 1%. Core inflation was at 0.9%. Because short-term rates are already so low (the deposit rate is at -0.4%), ECB monetary loosening is likely to be less effective than in the past. Still, the ECB meeting on September 12 saw a surprise announcement: the asset purchase programme is to restart on November 1 at a monthly pace of €20bn, while governments were strongly urged to take over from central banks as the main tool in supporting activity.