EUROZONE DATA
MNI (London)
- Eurozone economic sentiment improved by 2.8 points in January, outpacing forecasts at 99.0 as economic uncertainty fades and future outlooks including softer inflation and demand recovery into 2023 improve.
- This was the fourth consecutive month of improvements, which were largely sector-wide barring the weakening in construction.
- Government energy bill support has helped drive improvements in consumers' outlooks (confirmed at -20.9), yet whether the January improvement in purchasing intentions feeds into higher consumer spending remains uncertain.
- Eurozone growth is currently forecasted to dip into a contraction at -0.1% q/q in Q4, with initial downside risks larger after the Germany miss.
- Eurozone economic sentiment signals initial signs of demand resurgence, which will be necessary if the bloc is to avoid recession. Yet as monetary tightening begins to filter into Q1 investment, this recovery is likely to be more muted than currently foreseen.
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