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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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There are multiple potential explanations for the resilience of eurozone industry despite spiking energy costs and weakening demand: we identify idiosyncratic data and waning supply-side constraints as primary explanations.
- On the data side, Irish readings are distorting the aggregate print due to high volatility related to transfer pricing by multinational corporations. When removing Irish IP data from the set, eurozone industrial production strength doesn’t hold up. Excluding Ireland and reweighted, MNI’s calculation of month-on-month production stalled at 0.0%, whilst year-on-year growth was a more tame +2.4%.
- Likewise, September data was also boosted by a giant jump in Belgian pharmaceutical production. As such, overall production in the euro area was likely contractionary.
- Secondly, there is also a large element of supply-side bottlenecks easing, which is allowing production to ramp up to clear existing backlogs.
- But looking forward, despite resilience thus far, industrial production appears set to drag substantially on eurozone growth as the bloc enters an anticipated winter recession.
- Euro Q3 manufacturing PMIs recorded the fastest decline in outstanding orders since the initial 2020 pandemic shock.
Source: MNI From Eurostat Data
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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