EUROZONE DATA
Key themes to note are (1) the Eurozone ex-France and Germany continues to outperform the two largest economies, but (2) services cost pressures across the region remain elevated, even as pricing power limits some of the pass-on to end consumers.
Key notes from the release:
- “The two largest euro area economies continued to underperform the wider region…This performance contrasted with continued growth across the rest of the euro area, albeit the latest increase in output was the least marked since January”.
- Following President Lagarde’s seemingly increased focus on downside growth risks, particularly from net trade: “New export orders (which include intra-eurozone trade) fell more quickly than total new business as firms in the eurozone continued to struggle to secure sales from international clients”,
- “Cost pressures continued to be more pronounced in the service sector than in manufacturing, with services input prices up substantially in the latest survey period”.
- “While the pace of cost inflation quickened in July, output prices increased at a softer pace as falling demand limited company pricing power”.
- “Rates of charge inflation were broadly similar across Germany, France and the rest of the eurozone”.
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