Yahoo Finance

Economic Calendar:

Friday, 27^th September

• French Consumer Spending (MoM) (Aug)

The Majors

The European majors found much-needed support on Thursday, following 3 consecutive days in the red for the DAX30 and CAC40. Leading the way was the CAC40, which rose by 0.66%. DAX30 and EuroStoxx600 weren’t far behind, with gains of 0.44% and 0.61% respectively.

More positive comments from the U.S President on a willingness to form a trade agreement with China provided support to the European majors.

News of China increasing the import of pork was also positive going into the European open.

The more positive sentiment towards trade, coupled with an all-important pickup in German consumer sentiment delivered on the day.

Brexit and Impeachment talk from the U.S limited the upside for the European majors on the day, however.

The Stats

It was a quiet day on the Eurozone economic calendar on Thursday. Economic data was limited to Germany’s GfK Consumer Climate figures for September.

According to the latest GfK Consumer Climate Study for September,

• After 2 consecutive monthly declines, the economic outlook indicator rose by 3 points to -9.0 points. While up for the month, consumers continued to see a clear slowdown in the U.S economy.

• Year-on-year, the economic outlook indicator was down by 33.6 points.

• Income expectations also fell for a 2^nd consecutive month. The income expectations indicator fell by 3.3 points to 46.8 points.

• Year-on-year, the indicator was down by 8 points.

• The Propensity to buy indicator rose by 6.3 points to 55.1, supported by the ECB’s monetary policy decision. The ECB monetary policy decision weighed on the propensity to save, however, which fell to its lowest level since Apr-16.

The Economic Bulletin

Following the consumer climate figures, the ECB released its September Economic Bulletin. Key points included:

• Incoming information since the last meeting indicates a more protracted weakness of the euro area economy, the persistence of downside risks and muted inflationary pressures.

• Robust employment growth and increasing wages continue to underpin the resilience of the euro area economy.

• Economic data and survey information continue to point to moderate but positive growth in the 3^rd

• While the manufacturing sector feels the impact of the weakness of international trade, service, and construction services show ongoing resilience. Support comes from favorable financial conditions, further employment gains and rising wages, an expansionary fiscal stance and moderate growth in global activity.

• The economy is projected to grow by 1.1% in 2019, 1.2% in 2020 and by 1.4% in 2021. Compared with June 2019, growth was revised down for 2019 and 2020.

• Headline inflation is likely to decline before rising again towards the end of the year.

• Underlying inflation remained muted and indicators of inflation expectations stand at low levels.

• Over the medium-term, underlying inflation is expected to increase, supported by ECB monetary policy measures, economic expansion, and wage growth.