EBF Mid-Year Economic Outlook 2014

8/10/2019 EBF Mid-Year Economic Outlook 2014

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CONTACT

Raymond Frenken

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SUB-EDITOR

Alison Bell

Editor

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DESIGN & LAYOUT

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TERMS & CONDITIONS

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Mar-14

Jan-14

Nov-13

Sep-13

Jul-13

May-13

Mar-13

Jan-13

Nov-12

Sep-12

Jul-12

May-12

Mar-12

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Jan-11

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Sep-10

Jul-10

May-10

Mar-10

Jan-10

Nov-09

Sep-09

Jul-09

May-09

Mar-09

Jan-09

Nov-08

Sep-08

Jul-08

E ' , ,

w, %

Assets Loans Deposits

1. The CEG Consensus

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2. Global Economic Environment

90

95

100

105

110

115

120

125

130

May-14

Apr-14

Mar-14

Feb-14

Feb-14

Jan-14

Dec-13

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Feb-12

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Jan-12

B C O, USD


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Focus box 1: Trends in the banking sector

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4. Fiscal policy and the economy

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-3

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Euro Area, General Government, Excessive Deficit

Procedure, Net Lending/Net Borrowing, % of GDP,

Market Prices

AMECO, DG ECFIN CEG forecasts Maximum (SGP)

3. Domestic Economy

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AMECO DG ECFIN CEG forecasts Maximum (SGP)


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Euro Area, Unemployment Rate, %

DG ECFIN AMECO CEG forecasts

5. Inflation and monetary policy outlook


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S: ECB

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EURO AREA HCPI, %

Euro Area, Policy Rates, Main Refinancing Operations Rate, Effective Date

Inflation

Monetary policy medium-term target


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04-2014

03-2014

02-2014

01-2014

12-2013

11-2013

10-2013

09-2013

08-2013

07-2013

06-2013

05-2013

04-2013

03-2013

02-2013

01-2013

12-2012

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09-2012

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07-2012

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04-2012

03-2012

02-2012

01-2012

12-2011

11-2011

10-2011

09-2011

08-2011

07-2011

06-2011

ECB RATES, EONIA (SWAP RATES) & EURIBOR (FIXING)

BENCHMARKS, %

ECB Main refinancing rate ECB Deposit facility 3-month Euribor 6-month Euribor


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Focus box 2: Negative interest rates

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6. The euro

7. Risk to the scenario

1.20

1.25

1.30

1.35

1.40

1.45

May-14

Apr-14

Mar-14

Feb-14

Jan-14

Dec-13

Nov-13

Oct-13

Sep-13

Aug-13

Jul-13

Jun-13

May-13

Apr-13

Mar-13

Feb-13

Jan-13

Dec-12

Nov-12

Oct-12

Sep-12

Aug-12

Jul-12

Jun-12

May-12

Apr-12

Mar-12

Jan-12

USD / EUR EXCHANGE RATE


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B) Risks emerging from the global environment

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ANNEX 1:

MID-YEAR POLL ON THE EURO AREA ECONOMIC OUTLOOK FOR 2014

2011 2012 2013

Commission's

Forecasts

Full-year

2013

Mid-year

2013Spring 2014

(Ann.% change)

Gross domestic product (GDP) 1.6 -0.7 -0.4 1.1 0.9 1.4 1.0 0.9 1.4

Priva te consumption 0.3 -1.4 -0.7 0.7 0.5 1.0 0.5 0.3 0.8

Public consumption -0.1 -0.6 0.1 0.4 -0.3 0.8 0.1 0.0 0.7

Gross fixed investment (GFCF) 1.6 -4.0 -3.1 2.4 1.4 3.4 1.5 1.3 2.3

Exports 6.5 2.5 1.3 3.9 3.1 4.6 4.2 4.7 4.0Imports 4.5 -0.9 -0.1 3.7 2.9 4.3 3.7 3.8 3.8

(Ann.% change)

Unemployment ra te (%) 1 0.1 11.3 12.0 11.9 11.7 12.2 12.1 12.4 11.8

Wages (Unit Labour Cost) 0.8 1.9 1.2 1.2 0.5 2.0 1.2 1.0 0.7

Prices (HCPI) 2.7 2.5 1.4 0.9 0.7 1.2 1.4 1.6 0.8

Core HCPI 1 .4 1.5 1.1 0.9 0.7 1.1 1.2 1.4

3. Public finances: (% GDP)

Government Balance -4.1 -3.7 -3.0 -2.6 -3.0 -2.5 -2.8 -2.5 -2.5

Government Debt 8 8.2 92.8 95.1 95.9 94.3 97.3 96.6 95.7 96.0

4. External sector: (% GDP)

Trade Balance 0.3 1.4 1.4 2.2 1.5 3.1 1.7 1.8 2.4

Current Account Bala nce 0.4 1.8 2.6 2.4 1.6 3.0 2.2 1.6 2.9

(p.m.) US growth (Ann.% change) 1.8 2.8 1.9 2.7 2.5 3.0 2.7 2.7 2.8

(p.m.) Oil price (Brent, annual average) USD / b 111.0 111.8 108.7 106.8 102.0 110.0 105.6 106.7 107.6

5. Monetary and financial indicators:

June 1 .25 1.00 0.50 0.22 0.10 0.25 0.38 0.64

December 1 .00 0.75 0.25 0.19 0.10 0.25 0.41 0.73

3 month interest rate

(EURIBOR) (year-end) 1 .36 0.19 0.29 0.27 0.10 0.40 0.36 0.57

10 year government bond

yield (Bund) (year-end) 1 .83 1.32 1.90 1.94 1.50 2.20 2.39 2.24

M3 growth (annual growth) 1.5 3.0 2.3 2.5 1.5 4.0 2.90 4.00

Credit to private sector

(M3 definition) (annual growth) 2.1 -0.3 -1.6 -1.2 -2.5 1.5 0.80 1.23

Exchange rate USD/EUR (year-end) 1 .29 1.32 1.38 1.31 1.26 1.35 1.26 1.26 1.38

Interest rate on ECB's main

refinancing operations

1. Output and aggregate demand:

2. Labour market and prices:

Earlier CEG Outlooks

2014

range

2014

mean

TABLE 1 CEG Consensus 2014 2014


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ANNEX 2:

MID-YEAR POLL ON THE EURO AREA ECONOMIC OUTLOOK FOR 2015

2011 2012 2013

Commission's

Forecasts

Spring 2014

(Ann.% change)

Gross domestic product (GDP) 1.6 -0.7 -0.4 1.5 1.1 1.7 1.6

Private consumption 0.3 -1.4 -0.7 1.1 0.8 1.4 1.3

Public consumption -0.1 -0.6 0.1 0.5 0.0 0.9 0.5Gross fixed investment (GFCF) 1.6 -4.0 -3.1 3.0 1.6 4.2 4.2

Exports 6.5 2.5 1.3 4.3 3.1 5.7 5.3

Imports 4.5 -0.9 -0.1 4.3 3.1 5.9 5.5

(Ann.% change)

Unemployment rate (%) 10.1 11.3 12.0 11.7 11.3 12.1 11.4

Wages (Unit Labour Cost) 0.8 1.9 1.2 1.2 0.2 2.4 0.8

Prices (HCPI) 2.7 2.5 1.4 1.4 1.0 2.0 1.2

Core HCPI 1.4 1.5 1.1 1.1 0.8 1.4

3. Public finances: (% GDP)

Government Balance -4.1 -3.7 -3.0 -2.3 -2.7 -1.8 -2.3

Government Debt 88.2 92.8 95.1 96.0 94.5 98.5 95.4

4. External sector: (% GDP)

Trade Balance 0.3 1.4 1.4 2.1 1.0 3.2 2.3

Current Account Bala nce 0.4 1.8 2.6 2.3 0.8 2.9 2.9

(p.m.) US growth (Ann.% change) 1.8 2.8 1.9 3.0 2.3 3.5 3.2

(p.m.) Oil price (Brent, annual average) USD / b 111.0 111.8 108.7 104.3 97.0 110.0 102.9

5. Monetary and financial indicators:

June 1.25 1.00 0.50 0.21 0.10 0.50

December 1.00 0.75 0.25 0.33 0.10 0.75

3 month interest rate

(EURIBOR) (year-end) 1.36 0.19 0.29 0.47 0.10 1.40

10 year government bond

yield (Bund) (year-end) 1.83 1.32 1.90 2.44 1.80 3.15

M3 growth (annual growth) 1.5 3.0 2.3 3.6 2.0 6.0

Credit to private sector

(M3 defini tion) (annual growth) 2.1 -0.3 -1.6 1.0 -1.0 3.0

Exchange rate USD/EUR (year-end) 1.29 1.32 1.38 1.29 1.22 1.35 1.38

Interest rate on ECB's main

refinancing operations

2. Labour market and prices:

1. Output and aggregate demand:

TABLE 2 CEG Consensus 2015 2015

2015

range

2015

mean


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EBF Economic Outlook Nr 37

EBF Mid-Year Economic Outlook 2014

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