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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.
EUROZONE
The estimated probability of a recession in the euro area in October, ie 6-months ahead, remained subdued around 20% to 25%. The recession outlook improves the closer we are to end-2023 and currently it looks as though there will be a euro area slowdown but not a slump. The ECB meets today (see MNI ECB Preview - May 2023) and is expected to hike rates 25bp. Market and economic developments are supporting a low risk of a recession and thus also support further ECB tightening given that inflation is well above its target.
- Our April estimate assumes that the number of unemployed was steady and that M3 growth eases further to 2% y/y.
- The equation from 1985 indicates a 19.6% chance of a recession 6-months ahead down from 21.3%. Equities, economic sentiment and continued falling unemployment have been supporting economic growth and keeping the risk of a recession subdued.
- The 1998-estimation shows a slightly higher recession probability at 26% down from 28%.
- Econometric estimates are only estimates and not projections.
Euro area recession probability in 6 months estimations
Source: MNI - Market News/Refinitiv
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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