Investing.com - Financial Markets Worldwide

Euro Deflation Scare Set To Continue‏

ByDanske Markets
Published 11/24/2013, 04:23 AM
Updated 05/14/2017, 06:45 AM
EUR/USD
0.53%

Market movers ahead:

The US holiday shopping season kicks off next week with Thanksgiving. It is hoped it will confirm the upbeat message from the October retail sales report.

We expect euro area flash inflation for November to increase a notch but remain at a level uncomfortably low for the ECB.

October industrial production growth in Japan should be solid but we expect a small decline in the Markit PMI for November. Inflation is likely to continue higher, although at a slowing pace.

We expect Swedish Q3 GDP to post a 0.3% increase q/q. This will not have much impact on the Riksbank decision in December though, as the focus is on low inflation - we continue to expect a rate cut.

Norges Bank is due to release the survey results from its regional network report, which is one of its preferred economic indicators. In Denmark, we expect Q3 GDP growth to show a 0.3% q/q increase driven by better exports.


Global macro and market themes:

The euro deflation scare is set to remain with us for a while but bad deflation is unlikely to materialise, in our view.

The Fed is moving closer to tapering.

Risk assets are underpinned by recovery - search for yield and Chinese reforms.

Upward pressure on US yields continues - the EUR/USD is heading lower.

Euro recovery is on track.

To Read the Entire Report Please Click on the pdf File Below.

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