Slew of Disappointing EU Economic Figures

Alan Penny

3 January 2020

2 min read

EU/US flags

  • French Preliminary CPI M/M
  • Spanish Unemployment Change
  • German Unemployment Change
  • EU Private Loans Y/Y

Early on Friday the EU released a handful of economic figures. These EU economic figures showed a less than exciting outlook for Europe. The EU has been flat on its back for some time, and quite frankly needs some good news to move forward. There are now plenty of issues in the European Union and the latest grouping of announcements only drives that point home further.

EU economic figures announcements

The announcements during the early hours on Friday included the French Preliminary CPI month over month figures, the Spanish Employment Change figures, the German Unemployment Change figures, as well as EU Private Loans year over year. These figures were very disappointing which shows a continuation of what has been occurring for some time.

This will have very little effect on inflation and should keep the ECB on the sidelines as far as the French situation is concerned

The French Preliminary CPI month over month figures came out at 0.4%, which is better than the anticipated 0.3% but doesn’t exactly breathe confidence. This will have very little effect on inflation and should keep the ECB on the sidelines as far as the French situation is concerned. The Spanish Unemployment Change figures came out at a loss of 34,600 jobs, instead of the expected loss of 40,200 claims. German Unemployment Change rose by 8000, instead of the expected rise of 3000.

Private loans for the European Union came out at 3.5%, under the 3.6% anticipated. In other words, the European Union is still very unstable and messy. This will probably continue to weigh upon European equities and most certainly economic outlook.

Growth looking lackluster

The main take away with these economic announcements is that it still looks very lumpy as far as growth is concerned in the European Union. It should continue to be a bit lackluster overall. Europe is still a place that will lag behind North America and Asia, although there are a certain amount of value hunters looking to get involved in the European Union.

Most of the upcoming trades in the European Union will have a lot to do with an individual’s timeframe. Investors might find that the European Union may offer a bit of value. However, traders might find that European assets will continue to be a bit soft. Confidence still must be taking a bit of a backseat due to Brexit and the plethora of bad economic numbers.

The Europeans will still take a backseat to many other economies around the world. The most recent batch of economic numbers are yet another sign that the EU is still relatively far away from anything representing significant growth. Those looking for a longer-term “buy-and-hold” strategy may find value in the European stock markets and possibly even the currency. This should be recognized as a multi-year setup. In the meantime, Europe continues to struggle overall.

Written By
Alan Penny

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