European Numbers Stronger on Thursday

Alan Penny

28 November 2019

3 min read

Euro flat

  • Swiss GDP Q/Q
  • German Preliminary CPI M/M
  • Spanish Flash CPI Y/Y
  • EU M3 Money Supply Y/Y

Thursday’s trading session received several European figures on the economic front. Most of them should continue to press the narrative of the European Union stabilizing and perhaps even getting a bit better. This, in turn, offers the narrative of a potential turnaround in the global economy.

Recently, there have been major concerns of the European Union heading into recession, but the core of Europe seems to be avoiding that.

A handful of European economic figures

The handful of European economic figures which came out during the day gave a picture of stability, albeit in somewhat minor areas. Perhaps the most important data would have been the Swiss GDP quarter-over-quarter.

While not in the European Union, 85% of Swiss exports end up in the European Union. So, in a sense, Switzerland is a “secondary indicator” of European Union strength. The GDP quarter-over-quarter figure came out at 0.4%, which is much higher than the anticipated 0.1% for the quarter.

economic European figures which came out during the day gave a picture of stability

Germany’s preliminary Consumer Price Index month-over-month came out at -0.8%, slightly lower than the anticipated -0.7% for the month, although still keeping stable over the last several months. Next was the Spanish Flash Consumer Price Index year-over-year, coming out at a stronger 0.4% as opposed to the 0.2% that was anticipated. Finally, the European Union M3 Money Supply year-over-year came out at 5.6%, as opposed to the anticipated 5.5% for the year.

The numbers warrant a bit of optimism but aren’t necessarily blockbusters. Nonetheless, it’s yet another thing to be optimistic about in the European Union. Perhaps it should also offer some hope for those looking to invest in the EU.

That being said, we still have a long way to go before it is anything close to a strong economy. Still, as these minor figures come out and show signs of optimism, they should start to build the case for the bulls.

Keeping track of the numbers

It’s relatively simple from a fundamental analysis basis that, if numbers are trending higher and in a more favorable direction, it’s only a matter of time before the markets catch up to that realization. However, if they start drifting in the wrong direction, this should provide a lot of negative pressure on stock markets around the EU, and of course the euro itself.

None of these numbers are worth trading in and of themselves. However, traders should be keeping some type of spreadsheet on economic figures in the European Union and any other area they trade in. This spreadsheet should include several figures from several parts of the economy.

Ultimately, these types of numbers help fill in the “big picture”, something that is difficult to keep track of. That is why it’s so important to keep track of all of them in an organized fashion.

So far, they are starting to show signs of life. Therefore, although weak, the European Union may assume its worst days are behind it.

Written By
Alan Penny

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