Europe Caught Off-Balance

Summary

The eurozone slowed somewhat more than expected in Q4 of last year, with growth shrinking to 0.1% in the quarter. Looking at individual countries, the biggest surprises were the contraction in activity in Italy (-0.3% QoQ) and France (-0.1% QoQ) and the stagnation of the German economy.

Key points

• Key points:
• Evidence suggests that domestic demand lost some of its steam, while exports recovered following the disappointing figures observed toward the middle of the year.
• That said, confidence indicators from the beginning of the year are holding up relatively well.

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