Mon, Jun 14, 2021 @ 07:56 GMT
HomeContributorsFundamental AnalysisEU Raises Its GDP Outlook For Both 2021 And 2022

EU Raises Its GDP Outlook For Both 2021 And 2022


  • German Apr Final CPI reading confirms its highest annual pace in two years.
  • UK Q1 GDP data showed the economy weathered coronavirus restrictions better than initially feared; markets expect growth to continue to accelerate in the coming months.
  • Awaiting US inflation data but unlikely to have Fed move away from its loose monetary policy despite higher inflation.


  • South Korea Apr Unemployment Rate: 3.7% v 3.9% prior.
  • Australia Debt Agency AOFM) comments on the 2021-22 bond issuance program. 2020-21 It cuts its planned issuance for the current fiscal year from A$210B to A$210B.


  • Total global cases 159.3M; total deaths: 3.31M.


  • UK Chief Negotiator Frost stated that the Northern Ireland protocol could not last in its current state and was presenting significant challenges for businesses –


  • Fed’s Bullard (non-voter, dove): reiterates expects to see more inflation in 2021 and noted it was too early to talk about tapering asset purchases.
  • Fed’s Kashkari (dove, non-voter) reiterated the stance that the US was a long way from maximum employment.
  • Fed’s Harker (non-voter) saw no reason for Fed to pull back on stimulus now; the Fed policy to hold steady for now. Saw inflation reaching 2.3% this year, with core inflation at 2%; monetary and fiscal aid creates upside risk for inflation.
  • Fed’s Bostic (FOMC voter): we’re on the road to recovery but a long way to go.


  • Weekly API Crude Oil Inventories: -2.5M v -7.7M prior.
  • IAEA: Iran’s Natanz plant has enriched uranium to 63%, higher than the announced 60% earlier; complicates talks to revive its nuclear deal with world powers.

Speakers/Fixed income/FX/Commodities/Erratum


  • Indices [Stoxx600 +0.32% at 437.98, FTSE +0.61% at #, DAX +0.14% at 15,141.05, CAC-40 +0.04% at 6,269.74 , IBEX-35 +0.06% at 8,993.00, FTSE MIB +0.10% at 24,421.50, SMI +0.18% at 11,009.52, S&P 500 Futures -0.29%].
  • Market Focal Points/Key Themes: European indices open generally flat and failed to gain direction later in the session with mixed performance across the board; better-performing sectors include materials and consumer discretionary; sectors inclined to the downside include industrials and financials; Swedish markets to close early; UDG Healthcare to be acquired by Nenelite; earnings expected in the upcoming US session include Wendy’s, Hera, Pirelli, and Sonos.


  • Consumer discretionary: Ahold Delhaize [AD.NL] +4% (earnings), Carrefour [CA.FR] +2% (earnings), Ubisoft [UBI.FR] -7% (earnings), TUI Group [TUI1.DE] -3% (earnings), Delivery Hero [DHER.DE] -2% (expands in Germany).
  • Financials: Commerzbank [CBK.DE] +7% (earnings), ABN AMRO Bank [ABN.NL] -7% (earnings).
  • Healthcare: UDG Healthcare [UDG.UK] +22% (to be acquired; earnings), Bayer [BAYN.DE] +3% (earnings), Merck KGaA [MRK.DE] -1% (earnings).
  • Telecom: Deutsche Telekom [DTE.DE] +2% (earnings).


  • EU Commission Spring Forecasts raised its 2021 and 2022 growth forecasts and saw all EU economies returning to pre-pandemic growth by the end of 2022.
  • France Fin Min Le Maire stated that 2021 French GDP growth to be among the strongest in the region.
  • UK Chancellor of the Exchequer Sunak (Fin Min): Household incomes have been protected during the pandemic which will bode well for spending this year.
  • EU Economic Commissioner Gentiloni (Italy): To keep budget rules suspended through 2022.
  • Finland Finance Ministry forecasted 2021 GDP growth at 2.6% and saw 2022 growth at 2.5%.
  • Turkey President Erdogan stated that would take normalization steps after the holiday; COVID-19 restrictions to be eased gradually from the week of May 16th (next week).
  • Philippines Central Bank (BSP) Policy Statement noted that its accommodative stance to help quicken recovery but noted that sustained support for domestic demand remained a priority. CPI to return to target in 2021-22 period aided by PHP currency (Peso) and that risks to inflation outlook were broadly balanced.
  • IEA Monthly Oil Report noted that the world had used up it pandemic oil glut. Cut its 2021 global oil demand growth from 5.7M BPD to 5.4M BPD.

Currencies/Fixed Income

  • Recent weakness in global equity markets helped to stem the USD losses as safe-haven flows surfaced. Dealers note that any strength in the greenback would be short-lived as any higher US inflation data would unlikely to have Fed move away from its loose monetary policy. Analysts currently expect no US rate hikes for the next two years.
  • Italy 10-year govt yield at 1.00% (highest since Sept) as dealers note concerns that ECB could implement a premature tapering of its Pandemic Emergency Purchase Program (PEPP).

Economic data

  • (SE) Sweden Apr PES Unemployment Rate: 3.7 v 4.0% prior.
  • (FI) Finland Mar Final Retail Sales Volume Y/Y: 6.4% v 5.8% prelim.
  • (FI) Finland Mar Current Account Balance: -€0.8B v +€0.2B prior.
  • (UK) Q1 Preliminary GDP Q/Q: -1.5% v -1.6%e; Y/Y: -6.1% v -6.1%e.
  • (UK) Mar Monthly GDP M/M: 2.1% v 1.5%e.
  • (UK) Q1 Preliminary Private Consumption Q/Q: -3.9% v -1.8%e; Government Spending Q/Q: 2.6% v 0.6%e; Gross Fixed Capital Formation Q/Q: -2.3% v -0.8%e; Exports Q/Q: -7.5% v7.3%e; Imports Q/Q: -13.9% v -7.3%e.
  • (UK) Q1 Preliminary Total Business Investment Q/Q: -11.9% v -2.5%e; Y/Y: -18.1% v -7.4% prior.
  • (UK) Mar Industrial Production M/M: 1.8% v 1.0%e; Y/Y: 3.6% v 2.9%e.
  • (UK) Mar Manufacturing Production M/M: 2.1% v 1.0%e; Y/Y: 4.8% v 3.7%e.
  • (UK) Mar Construction Output M/M: 5.8% v 1.0%e; Y/Y: 6.0% v 0.2%e.
  • (UK) Mar Index of Services M/M: 1.9% v 1.8%e; 3M/3M: -2.0% v -1.7%e.
  • (UK) Mar Visible Trade Balance: -£11.7B v -£14.3Be; Overall Trade Balance: -£2.0B v -£4.9Be; Trade Balance Non EU: -£6.6B v -£10.7B prior.
  • (NO) Norway Q1 GDP Q/Q: -0.6% v +0.8% prior; GDP Mainland Q/Q: -1.0% v -0.7%e.
  • (NO) Norway Mar GDP M/M: -0.4% v -0.3%e; GDP Mainland M/M: -0.5% v -0.4%e.
  • (DE) Germany Apr Final CPI M/M: 0.7% v 0.7%e; Y/Y: % v 2.0%e.
  • (DE) Germany Apr Final CPI EU Harmonized M/M: 0.5% v 0.5%; Y/Y: 2.1% v 2.1%e.
  • (FR) France Apr Final CPI M/M: 0.1% v 0.2%e; Y/Y: 1.2% v 1.3%e; CPI (ex-tobacco) Index: 105.00 v 105.07e.
  • (FR) France Apr Final CPI EU Harmonized M/M: 0.2% v 0.3%e; Y/Y: 1.6% v 1.7%e.
  • (SE) Sweden Apr CPI M/M: 0.2% v 0.2%e; Y/Y: 2.2% v 2.2%e; CPI Level: 340.37 v 340.23e.
  • (SE) Sweden Apr CPIF M/M: 0.3% v 0.2%e; Y/Y: 2.5% v 2.4%e.
  • (SE) Sweden Apr CPIF (ex-energy) M/M: 0.4% v 0.4%e; Y/Y: 1.7% v 1.6%e.
  • (PH) Philippines Central Bank (BSP) left the Overnight Borrowing Rate unchanged at 2.00% (as expected).
  • (CN) China Apr New Yuan Loans (CNY): 1.470 v 1.600Te.
  • (CN) China Apr Aggregate Financial (CNY): 1.85T v 2.290Te.
  • (CN) China Apr M2 Money Supply Y/Y: 8.1% v 9.2%e; M1 Money Supply Y/Y: 6.2% v 7.1%e; M0 Money Supply Y/Y: 5.3% v 4.0%e.
  • (EU) Euro Zone Mar Industrial Production M/M: 0.1% v 0.8%e; Y/Y: 10.9% v 11.8%e.
  • (GR) Greece Apr CPI Y/Y: -0.3% v -1.6% prior; CPI EU Harmonized Y/Y: -1.1% v -2.0% prior.

Fixed income Issuance

  • (IN) India sold a total INR360B vs. INR360B indicated in 3-month, 6-month, and 12-month bills.
  • (NO) Norway sold NOK3.0B vs. NOK3.0B indicated in 1.375% 2030 Bonds; Avg Yield: 1.44% v 1.45% prior; bid-to-cover: 2.06x v 2.34x prior.
  • (IT) Italy Debt Agency (Tesoro) sold €7.5B vs. €7.5B indicated in 12-month Bills; Avg Yield: -0.433% v -0.436% prior; Bid-to-cover: 1.42x v 1.37x prior.

Looking Ahead

  • (RO) Romania Central Bank (NBR) Interest Rate Decision: Expected to leave Interest Rate unchanged at 1.25%.
  • 05:20 (EU) Daily ECB Liquidity Stats.
  • 05:30 (HU) Hungary Debt Agency (AKK) to sell 12-month Bills.
  • 05:30 (PT) Portugal Debt Agency (IGCP) to sell €1.0-1.25B in 2031 and 2035 OT bonds.
  • 05:30 (ZA) South Africa announces details of next bond auction (held on Tuesdays).
  • 06:00 (IE) Ireland Mar Property Prices M/M: No est v 0.3% prior; Y/Y: No est v 3.0% prior.
  • 06:00 (PT) Portugal Apr Final CPI M/M: No est v 0.4% prelim; Y/Y: No est v 0.5% prelim.
  • 06:00 (PT) Portugal Apr Final CPI EU Harmonized M/M: No est v 0.5% prelim; Y/Y: No est v -0.1% prelim.
  • 06:45 (US) Daily Libor Fixing.
  • 07:00 (RU) Russia OFZ Bond auction (if any).
  • 07:00 (US) MBA Mortgage Applications w/e May 7th: No est v -0.9% prior.
  • 07:00 (MX) Mexico Mar Industrial Production M/M: 0.7%e v 0.4% prior; Y/Y: +0.6%e v -4.5% prior; Manufacturing Production Y/Y: +2.1%e v -4.7% prior.
  • 07:00 (UK) Weekly PM Question time in House.
  • 08:00 (IN) India Apr CPI Y/Y: 4.1%e v 5.5% prior.
  • 08:00 (IN) India Mar Industrial Production Y/Y: +20.0%e v -3.6% prior.
  • 08:00 (HU) Hungary Central Bank (MNB) Apr Minutes.
  • 08:00 (BR) Brazil Mar IBGE Services Sector Volume Y/Y: +2.6%e v -2.0% prior.
  • 08:00 (UK) Daily Baltic Dry Bulk Index.
  • 08:30 (US) Apr CPI M/M: 0.2%e v 0.6% prior; Y/Y: 3.6%e v 2.6% prior.
  • 08:30 (US) Apr CPI (ex-food/energy) M/M: 0.3%e v 0.3% prior; Y/Y: 2.3%e v 1.6% prior.
  • 08:30 (US) Apr CPI Index NSA: 265.592e v 264.877 prior; CPI Core Index SA: 271.950e v 271.214 prior.
  • 08:30 (US) Apr Real Avg Hourly Earning Y/Y: No est v 1.5% prior; Real Avg Weekly Earnings Y/Y: No est v 3.9% prior.
  • 09:00 (RU) Russia Apr Trade Balance: $7.7Be v $8.3B prior; Exports: $31.9Be v $29.3B prior; Imports: $24.6Be v $21.0B prior.
  • 09:00 (US) Fed Vice Chair Clarida.
  • 09:45 (UK) BOE buys £1.147B in APF Gilt purchase operation (7-20 years).
  • 10:30 (US) Weekly DOE Oil Inventories.
  • 11:05 (SE) Sweden Central Bank (Riksbank) Breman on panel.
  • 12:00 (CA) Canada to sell 2-year notes.
  • 13:00 (MX) Mexico Apr Total Formal Job Creation: No est v +88.8K prior.
  • 13:00 (US) Treasury to sell 10-year notes.
  • 14:00 (US) Apr Monthly Budget Statement: -$100.0Be v -$660B prior.
  • 18:45 (NZ) New Zealand Apr Food Prices M/M: No est v 0.0% prior.
  • 19:01 (UK) Apr RICS House Price Balance: 62%e v 59% prior.
  • 19:50 (JP) Japan Mar Current Account Balance: ¥2.765Te v ¥2.917T prior; Adjusted Current Account Balance: ¥1.878Te v ¥1.795T prior; Trade Balance (BoP Basis): ¥787.7Be v ¥524.2B prior.
  • 21:00 (AU) Australia May Consumer Inflation Expectation Survey.
  • 23:00 (KR) South Korea Mar M2 Money Supply M/M: No est v 1.3% prior; “L” Money Supply M/M: No est v 1.0% prior.
  • 23:35 (JP) Japan to sell 30-Year JGB Bonds.


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