Euro zone and U.S. manufacturing expand, China struggles

By Jonathan Cable and Caroline Valetkevitch

LONDON/NEW YORK (Reuters) – Euro zone businesses ramped up activity this month as the European Central Bank started printing money to spur economic growth, while a slowdown among Chinese factories fueled expectations of more monetary stimulus.

U.S. manufacturing activity growth also edged up despite a stronger U.S. dollar and the threat of an interest rate rise from the Federal Reserve later this year.

The Eurozone Composite Flash Purchasing Managers’ Index (PMI) from data vendor Markit, based on surveys of thousands of companies and seen as a good growth indicator, jumped to a near- four-year high of 54.1 from February’s 53.3.

The surveys pointed to first-quarter euro zone economic growth of 0.3 percent, Markit said, matching the previous three months’ but shy of the 0.4 percent median forecast in a Reuters poll taken earlier this month. [ECILT/EU]

The ECB began its quantitative easing program to buy bonds worth more than a trillion euros in March.

“I wouldn’t want to give QE too much credence at this stage. The ECB has only been buying for a couple of weeks and QE takes a long time to have any impact – if at all,” said Peter Dixon at Commerzbank. “The outright QE itself has had zero impact; growth was already happening.”

A sub-index measuring euro zone prices jumped to an eight-month high of 49.0. But it has spent three years below the break-even level of 50, suggesting inflation will not return any time soon.

Oil prices have tumbled over the past nine months and inflation rates across the world have followed suit.

European shares and the euro edged up after the surveys were published but the slowdown in China kept oil and commodities-linked assets under pressure. [MKTS/GLOB]

CHINA BRAKES

China’s flash HSBC/Markit PMI dipped to an 11-month low of 49.2 in March, below the 50 level that separates growth from contraction.

“The deteriorating PMI confirmed that downside risks to China’s 2015 growth have started to materialize. We expect an accelerated monetary easing cycle and somewhat loosening of the fiscal stance,” said Jian Chang at Barclays.

Some analysts expected China’s first-quarter economic growth to slip below the government’s new full-year target of 7.0 percent, widely seen as the level needed to keep employment steady.

China’s economic slowdown is stabilizing, with employment and services among the bright spots, Vice Premier Zhang Gaoli said on Sunday.

The country’s leaders have said they would be willing to tolerate somewhat slower growth as long as the labor market remained resilient. But the latest PMI employment sub-index contracted for a 17th straight month, hitting its lowest since the depths of the global financial crisis.

U.S. MANUFACTURING GROWTH AT FIVE-MONTH HIGH

Growth in the U.S. manufacturing sector edged up to a five- month high in March, according to Markit.

The preliminary U.S. Manufacturing Purchasing Managers’ Index rose to 55.3, its highest since October, when the final PMI was 55.9.

“Manufacturing regained further momentum from the slowdown seen at the turn of the year, with output, new orders and employment growth all accelerating in March,” said Chris Williamson, Markit’s chief economist.

The flash reading of the index measuring new orders also rose in March to the highest since October, coming in at 56.4, compared with February’s final reading of 55.8.

Employment growth also rose in March from February, Markit said.

(Corrects paragraph 15, subhead, to 5-month high from 4-month high for U.S. PMI)

(Additional reporting by Kevin Yao in Beijing; Editing by Jeremy Gaunt, Clive McKeef and Dan Grebler)

Europe risks, U.S. caution could delay British rate rises

(Update 2)

LONDON (Oct 9): The risk of a new recession in the euro zone and caution from the U.S. Federal Reserve are weighing on expectations of the timing of a first increase in British borrowing costs, potentially delaying it.

The Bank of England, as expected, kept its benchmark interest rate at a record low at 0.5 percent on Thursday, the level at which it has sat since the financial crisis.

Although Britain’s economy has surged since mid-2013, the BoE has kept rates on hold due to a combination of weak pay growth and inflation below its 2 percent target.

So far, only two of the Monetary Policy Committee’s nine members have voted for a hike. But expectations have been strong that rates could start to rise in February next year.

Now British policymakers are casting a nervous eye at the euro zone and in particular Germany, which this week announced a string of far weaker than expected economic data.

Adding to the sense that rate rises might come later than recently thought, the Fed has sounded worried about the impact on the U.S. economy of the slowdown in Europe and in Asia.

British finance minister George Osborne called on the European Central Bank to do more to help growth, despite the concerns of Germany about the risks of the central bank buying government bonds, the most powerful stimulus at its disposal.

“You need credible fiscal plans, and the Germans would certainly agree with me on that, but I think you also need the European Central Bank doing its bit to help,” he told the BBC.

In Britain, there are some tentative signs of a cooling. The British Chambers of Commerce warned of a “first alarm bell” for the recovery after firms reported the weakest export growth in almost two years and a big slowdown in manufacturing.

British house prices nationwide showed their smallest increase in 15 months, according to a survey this week.

If sustained, the slowdown could feed into next year’s general election and Conservative Prime Minister David Cameron’s bragging rights over an improved economy.

Investors earlier on Thursday showed they were less convinced that the BoE would raise interest rates in early 2015.

Short-dated gilt prices rallied with other major government bonds and short sterling interest rate futures <0#FSS:>, bets on when rates will rise, rose strongly.

Rob Wood, a former BoE economist, said the cooling of Britain’s economy had been gentle so far and Germany’s economy could bounce back if the ceasefire in Ukraine holds and eases concerns that have weighed on the economies of eastern Europe.

“Still, the key point is that if euro zone, and especially German, sentiment and growth does not turn up over the next few months then the BoE could delay a rate hike,” said Wood who is chief UK economist at Berenberg bank. “Our base case is that the BoE will hike in February, but latest developments raise the risk that the BoE will wait longer to hike.”

Blame Europe

The BoE made no statement alongside its monthly policy announcement, which included a commitment to maintain at 375 billion pounds ($ 607.5 billion) the stockpile of assets which it acquired under its programme of government bond purchases.

Minutes of the MPC’s meeting are due to be published in just under two weeks’ time. The minutes of last month’s meeting suggested growing concern at the situation in Europe.

In September, MPC members saw only a modest direct impact of the euro zone’s slowdown, but minutes of their meeting showed they felt “a prolonged period of poor growth and very low inflation could have a larger impact if it led once again to uncertainty about the sustainability of euro-area public and external debt”.

Data on Tuesday showed German industrial output in August plunged at its steepest rate since the depths of the financial crisis. The International Monetary Fund has given a nearly 40 percent probability that the euro zone would enter recession over the next year.

The British economy struggled to grow during 2011 and 2012 when the euro zone was deep in a debt crisis that threatened to break up the single currency area.

Economists say the current growth problems in the single currency area will not deliver as big a hit to Britain. But the slowdown is a problem for the British manufacturing sector which accounts for about 10 percent of the country’s total economy.

Data published earlier this week showed British manufacturing edged up just 0.1 percent between August and July. Surveys have suggested that problems in the euro zone weighed on the sector more heavily in September.

($ 1 = 0.6173 British pounds)

Sterling struggles as UK rate hikes put into doubt

* Sterling down 0.5 pct vs euro after IMF

* Inflation and wage growth data eyed

* Carney says euro zone weakness will not dictate UK policy

* British 10-year gilt yields touch 16-month low

By Jemima Kelly

LONDON, Oct 13 (Reuters) – Sterling fell towards a four-week low against the euro on Monday on growing expectations that a global slowdown will lead to the Bank of England delaying interest rate rises until well into 2015.

Traders said UK inflation and wage growth data — due on Tuesday and Wednesday respectively — would be crucial, with any disappointment likely to further disappoint rate hike hopes and send the pound lower.

The failure of real wages to pick up, in turn reducing the risk of a bounce in inflation, has been the big hole in the argument for raising UK rates so far.

Money market rates have already shown investors backing away from the expectation of a BoE rate increase by the end of the year — a bet that drove sterling to a six-year peak against the dollar in July — as numbers from the UK have raised the prospect of an end-of-year economic slowdown.

“I would expect sterling to come under a bit of pressure ahead of tomorrow’s inflation data,” Western Union’s UK market analyst, Nawaz Ali, said.

“The next couple of days — the inflation data and the wage growth data — are going to give us a lot of answers to questions on BoE policy and the pound’s outlook from here.”

The euro strengthened by over half a percent against the pound on Monday to 78.97 pence, close to a 3-1/2 week high of 79 pence. That came as the yield gap between two-year British gilts and German bunds narrowed to its lowest in two months.

Sterling also weakened against the dollar, falling 0.1 percent to $ 1.6060. Sterling’s losses came despite a sluggish dollar which fell broadly after dovish comments from a host of U.S. Federal Reserve officials.

At a meeting in Washington over the weekend, financial leaders took stock of a weaker economic outlook and Fed officials said U.S. rate hikes could be delayed if global growth is weaker than anticipated.

But BoE Governor Mark Carney said on Monday that weakness in the euro zone — fast becoming the world’s central economic concern again — would not dictate UK monetary policy, and would only be one factor the bank considers when deciding when to raise interest rates.

“I still don’t like sterling,” Societe Generale (Paris: FR0000130809 – news) macro strategist, Kit Juckes, said, noting that he thought it likely that markets will have pushed back their expectations of a rate increase before May by the end of the week, after the inflation and wage data had been digested.

GILT YIELDS TUMBLE

Rate hike jitters also hit gilt yields, with British 10-year government bond yields falling to a 16-month low.

Yields on 10-year debt were down more than 4 basis points at 2.18 percent by 1435 GMT, adding to last week’s 19-basis-point drop, which was the largest weekly decline in more than a year. Earlier on Monday the yield was as low as 2.174 percent, its lowest since June 2013.

Investors were also focussing more on political risk in Britain.

Latest polling showed support for anti-EU party UKIP at 25 percent and the party’s leader said he would demand an immediate referendum on European Union membership as the price of supporting any coalition government after elections next May.

“I think most people still think this is a temporary phenomena that will not prove be as important a factor in the elections as it looks at the moment,” said a dealer with one London-based bank.

“But there’s no denying the nerves it will stir up in the run-in if support for UKIP does not fall off.” (Additional reporing by William Schomberg and Patrick Graham; Editing by Louise Ireland)

UK-BRITAIN-ECONOMY-BOE:Bank of England keeps rates at record low
Reuters Pedestrians walk past the Bank of England in the City of London May 15, 2014. REUTERS/Luke MacGregor

By William Schomberg

LONDON (Reuters) – The risk of a new recession in the euro zone and caution from the U.S. Federal Reserve are weighing on expectations of the timing of a first increase in British borrowing costs, potentially delaying it.

The Bank of England, as expected, kept its benchmark interest rate at a record low at 0.5 percent on Thursday, the level at which it has sat since the financial crisis.

Although Britain’s economy has surged since mid-2013, the BoE has kept rates on hold due to a combination of weak pay growth and inflation below its 2 percent target.

So far, only two of the Monetary Policy Committee’s nine members have voted for a hike. But expectations have been strong that rates could start to rise in February next year.

Now British policymakers are casting a nervous eye at the euro zone and in particular Germany, which this week announced a string of far weaker than expected economic data.

Adding to the sense that rate rises might come later than recently thought, the Fed has sounded worried about the impact on the U.S. economy of the slowdown in Europe and in Asia.

British finance minister George Osborne called on the European Central Bank to do more to help growth, despite the concerns of Germany about the risks of the central bank buying government bonds, the most powerful stimulus at its disposal.

“You need credible fiscal plans, and the Germans would certainly agree with me on that, but I think you also need the European Central Bank doing its bit to help,” he told the BBC.

In Britain, there are some tentative signs of a cooling. The British Chambers of Commerce warned of a “first alarm bell” for the recovery after firms reported the weakest export growth in almost two years and a big slowdown in manufacturing.

British house prices nationwide showed their smallest increase in 15 months, according to a survey this week.

If sustained, the slowdown could feed into next year’s general election and Conservative Prime Minister David Cameron’s bragging rights over an improved economy.

Investors earlier on Thursday showed they were less convinced that the BoE would raise interest rates in early 2015.

Short-dated gilt prices rallied with other major government bonds and short sterling interest rate futures , bets on when rates will rise, rose strongly.

Rob Wood, a former BoE economist, said the cooling of Britain’s economy had been gentle so far and Germany’s economy could bounce back if the ceasefire in Ukraine holds and eases concerns that have weighed on the economies of eastern Europe.

“Still, the key point is that if euro zone, and especially German, sentiment and growth does not turn up over the next few months then the BoE could delay a rate hike,” said Wood who is chief UK economist at Berenberg bank. “Our base case is that the BoE will hike in February, but latest developments raise the risk that the BoE will wait longer to hike.”

BLAME EUROPE

The BoE made no statement alongside its monthly policy announcement, which included a commitment to maintain at 375 billion pounds the stockpile of assets which it acquired under its programme of government bond purchases.

Minutes of the MPC’s meeting are due to be published in just under two weeks’ time. The minutes of last month’s meeting suggested growing concern at the situation in Europe.

In September, MPC members saw only a modest direct impact of the euro zone’s slowdown, but minutes of their meeting showed they felt “a prolonged period of poor growth and very low inflation could have a larger impact if it led once again to uncertainty about the sustainability of euro-area public and external debt”.

Data on Tuesday showed German industrial output in August plunged at its steepest rate since the depths of the financial crisis. The International Monetary Fund has given a nearly 40 percent probability that the euro zone would enter recession over the next year.

The British economy struggled to grow during 2011 and 2012 when the euro zone was deep in a debt crisis that threatened to break up the single currency area.

Economists say the current growth problems in the single currency area will not deliver as big a hit to Britain. But the slowdown is a problem for the British manufacturing sector which accounts for about 10 percent of the country’s total economy.

Data published earlier this week showed British manufacturing edged up just 0.1 percent between August and July. Surveys have suggested that problems in the euro zone weighed on the sector more heavily in September.

(Additional reporting by Andy Bruce and William James; Editing by Jeremy Gaunt)

UK-BRITAIN-ECONOMY-BOE:Bank of England keeps rates at record low
Reuters Pedestrians walk past the Bank of England in the City of London May 15, 2014. REUTERS/Luke MacGregor

By William Schomberg

LONDON (Reuters) – The risk of a new recession in the euro zone and caution from the U.S. Federal Reserve are weighing on expectations of the timing of a first increase in British borrowing costs, potentially delaying it.

The Bank of England, as expected, kept its benchmark interest rate at a record low at 0.5 percent on Thursday, the level at which it has sat since the financial crisis.

Although Britain’s economy has surged since mid-2013, the BoE has kept rates on hold due to a combination of weak pay growth and inflation below its 2 percent target.

So far, only two of the Monetary Policy Committee’s nine members have voted for a hike. But expectations have been strong that rates could start to rise in February next year.

Now British policymakers are casting a nervous eye at the euro zone and in particular Germany, which this week announced a string of far weaker than expected economic data.

Adding to the sense that rate rises might come later than recently thought, the Fed has sounded worried about the impact on the U.S. economy of the slowdown in Europe and in Asia.

British finance minister George Osborne called on the European Central Bank to do more to help growth, despite the concerns of Germany about the risks of the central bank buying government bonds, the most powerful stimulus at its disposal.

“You need credible fiscal plans, and the Germans would certainly agree with me on that, but I think you also need the European Central Bank doing its bit to help,” he told the BBC.

In Britain, there are some tentative signs of a cooling. The British Chambers of Commerce warned of a “first alarm bell” for the recovery after firms reported the weakest export growth in almost two years and a big slowdown in manufacturing.

British house prices nationwide showed their smallest increase in 15 months, according to a survey this week.

If sustained, the slowdown could feed into next year’s general election and Conservative Prime Minister David Cameron’s bragging rights over an improved economy.

Investors earlier on Thursday showed they were less convinced that the BoE would raise interest rates in early 2015.

Short-dated gilt prices rallied with other major government bonds and short sterling interest rate futures , bets on when rates will rise, rose strongly.

Rob Wood, a former BoE economist, said the cooling of Britain’s economy had been gentle so far and Germany’s economy could bounce back if the ceasefire in Ukraine holds and eases concerns that have weighed on the economies of eastern Europe.

“Still, the key point is that if euro zone, and especially German, sentiment and growth does not turn up over the next few months then the BoE could delay a rate hike,” said Wood who is chief UK economist at Berenberg bank. “Our base case is that the BoE will hike in February, but latest developments raise the risk that the BoE will wait longer to hike.”

BLAME EUROPE

The BoE made no statement alongside its monthly policy announcement, which included a commitment to maintain at 375 billion pounds the stockpile of assets which it acquired under its programme of government bond purchases.

Minutes of the MPC’s meeting are due to be published in just under two weeks’ time. The minutes of last month’s meeting suggested growing concern at the situation in Europe.

In September, MPC members saw only a modest direct impact of the euro zone’s slowdown, but minutes of their meeting showed they felt “a prolonged period of poor growth and very low inflation could have a larger impact if it led once again to uncertainty about the sustainability of euro-area public and external debt”.

Data on Tuesday showed German industrial output in August plunged at its steepest rate since the depths of the financial crisis. The International Monetary Fund has given a nearly 40 percent probability that the euro zone would enter recession over the next year.

The British economy struggled to grow during 2011 and 2012 when the euro zone was deep in a debt crisis that threatened to break up the single currency area.

Economists say the current growth problems in the single currency area will not deliver as big a hit to Britain. But the slowdown is a problem for the British manufacturing sector which accounts for about 10 percent of the country’s total economy.

Data published earlier this week showed British manufacturing edged up just 0.1 percent between August and July. Surveys have suggested that problems in the euro zone weighed on the sector more heavily in September.

(Additional reporting by Andy Bruce and William James; Editing by Jeremy Gaunt)

Europe risks, U.S. caution weigh on chances of British rate rise

By William Schomberg

LONDON (Reuters) – The risk of a new recession in the euro zone and caution from the U.S. Federal Reserve are weighing on expectations of the timing of a first increase in British borrowing costs, potentially delaying it.

The Bank of England, as expected, kept interest rates at a record low on Thursday, leaving Bank Rate at 0.5 percent, the level at which it has sat since the worst of the financial crisis five-and-a-half years ago.

Britain’s economy has staged a much stronger than expected recovery since mid-2013. But a combination of weak pay growth and inflation below the BoE’s 2 percent target has allowed the central bank to keep rates unchanged.

So far only two of the MPC’s nine members have voted for a rate hike, but expectations have been strong for hike as soon February next year.

Now British policymakers are casting a nervous eye at the euro zone and in particular Germany, which this week announced a string of far weaker than expected economic data.

Adding to the sense that rate rises might come later than recently thought, the Fed has sounded worried about the impact of the slowdown in Europe as well as in Asia.

In Britain itself, there are some tentative signs of a cooling. The British Chambers of Commerce warned on Thursday of a “first alarm bell” for Britain’s rapid economic recovery after firms reported the weakest export growth in almost two years and a big slowdown in manufacturing.

London house prices also fell last month for the first time in more than three years, and prices nationwide showed their smallest increase in 15 months.

If sustained, the slowdown could feed into next year’s general election and Conservative Prime Minister David Cameron’s bragging rights over an improved economy.

Investors earlier on Thursday showed they were less convinced that the BoE would raise interest rates in early 2015.

Short-dated gilt prices rallied along with other major government bonds and short sterling interest rate futures – <0#FSS:> which are bets on when interest rates will rise – rose strongly.

“We’re leaning more and more towards June, and maybe it’ll even be after that,” said Marc Ostwald, a strategist at ADM Investor Services International, when asked when the BoE might kick off its long-awaited rate hikes.

BLAME EUROPE

The BoE made no statement alongside its monthly policy announcement, which included a commitment to maintain at 375 billion pounds the stockpile of assets which it acquired under its programme of government bond purchases.

Minutes of the MPC’s meeting are due to be published in just under two weeks’ time. The minutes of last month’s meeting suggested growing concern at the situation in Europe.

In September, MPC members saw only a modest direct impact of the euro zone’s slowdown, but minutes of their meeting showed they felt “a prolonged period of poor growth and very low inflation could have a larger impact if it led once again to uncertainty about the sustainability of euro-area public and external debt”.

Indeed British finance minister George Osborne said on Thursday the euro zone risked slipping back into crisis.

Data on Tuesday showed German industrial output in August plunged at its steepest rate since the depths of the financial crisis. The International Monetary Fund has given a nearly 40 percent probability that the currency bloc would enter recession over the next year.

The British economy struggled to grow during 2011 and 2012 when the euro zone was deep in a debt crisis that threatened to break up the single currency area.

Economists say the current growth problems in the single currency area will not deliver as big a hit to Britain. But the European slowdown is a problem for the British manufacturing sector which accounts for about 10 percent of the country’s total economy.

Data published earlier this week showed British manufacturing edged up just 0.1 percent between August and July. Surveys have suggested that problems in the euro zone weighed on the sector more heavily in September.

(Additional reporting by Andy Bruce Editing by Jeremy Gaunt.)

Euro at Potentially Significant Turning Point

Euro at Potentially Significant Turning Point

Euro at Potentially Significant Turning Point

Fundamental Forecast for Euro: Neutral

  • Euro at risk as results from recent ECB actions cast doubt on future policy
  • Volume figures nonetheless warn of EUR bounce, and positions confirm risk
  • Help Identify Critical Turning Points for EUR/USD with DailyFX SSI

The Euro tumbled to fresh lows versus the high-flying US Dollar on a week of bad news for Europe and much better developments out of the US. But why might the Euro/Dollar exchange rate be at risk of an important bounce?

Almost all traditional fundamental signals point to further Euro weakness, and yet we see clear warning signs that such news and sentiment may be overdone. Everyone is bearish at major market bottoms and bullish at the tops, and that in itself is an important trigger which favors some sort of Euro bounce. Beyond that, however, we see technical reasons why the US Dollar rally may be overdone.

High FX market volatility continued to drive the safe-haven US currency higher across the board as the combination of a US Federal Reserve Meeting, key European Central Bank results, and the highly-anticipated Scotland independence referendum fueled major moves. Yet the week ahead promises far less foreseeable event risk, and our forward-looking DailyFX 1-Week Volatility Index has pulled back sharply. The US Dollar’s strong correlation to volatility leaves it at risk on such a slowdown.

It’s possible but unlikely that the Euro sees strong reactions to upcoming European Purchasing Managers Index (PMI) survey results, a German IFO Business Climate report, and a late-week GfK Consumer Confidence data release. Thus we’ll focus on how US Dollar traders react to calmer markets; we suspect that the EURUSD could bounce as sellers lose enthusiasm.

Recent FXCM Execution Desk numbers show that total Euro trading volume slowed even as it tumbled to fresh lows. While momentum clearly favors further losses, the slowdown acts as clear warning that markets may soon capitulate.

And thus we’re left with somewhat of a dilemma: on the one hand we believe that the Euro will remain in a downtrend, but too many signs warn of a near-term price and sentiment extreme. We advise caution on fresh EURUSD-short positions in the days ahead.

Written by David Rodriguez, Quantitative Strategist for DailyFX.com David specializes in automated trading strategies. Find out more about our automated sentiment-based strategies on DailyFX PLUS.

Contact and follow David via Twitter: https://twitter.com/DRodriguezFX

Euro-Zone Manufacturing Misses Forecast


Manufacturing activity in the euro zone slowed more sharply than first estimated in May, a sign that economic growth in the currency area is unlikely to prove strong enough to quickly boost the annual rate of inflation from levels that are so low as to concern the European Central Bank.

Data firm Markit’s survey of 3,000 manufacturing companies across the currency bloc found that while activity continued to increase, it did so at a slower pace than in April, and more slowly than estimated when the preliminary results were published last month.

The Purchasing Managers Index fell to 52.2 from 53.4 in April. A reading above 50.0 for the index indicates an expansion in activity.

“The slowdown in euro-zone manufacturing activity in May reinforces belief that the ECB will deliver a package of measures at its June 5 policy meeting, including interest rate cuts and liquidity measures,” said Howard Archer, an economist at IHS Global Insight.

Activity in Germany’s manufacturing sector slowed more sharply than first estimated, while France was the weakest of the euro-zone economies covered by the surveys–its PMI indicated that activity declined.

German manufacturers have been one of the driving forces behind the euro zone’s return to growth from the second quarter of last year. And while there are signs the country’s services sectors is making a larger contribution to growth, a sustained slowdown in German manufacturing would be a fresh source of worry for euro-zone policy makers.

“In Germany, the pace of expansion eased, possibly linked to some concerns over the situation in Ukraine, or perhaps simply due to the timing of Easter,” said Chris Williamson, Markit’s chief economist. “Without any clear cause, the slowdown in the region’s largest economy will perhaps be the biggest concern for the euro zone’s growth trajectory if a rebound isn’t forthcoming in June.”

Only Spain and the Netherlands recorded an acceleration of growth during the month.

The surveys indicated that manufacturers are hiring workers to meet rising new orders, although at a rate so modest that it seems likely to take many months before there is a significant fall in the currency area’s unemployment rate from near record highs.

For the ECB, there was also some welcome news on inflation, with first reporting they raised their prices after two months of cuts.

Write to Paul Hannon at [email protected]

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

    (END) Dow Jones Newswires   06-02-140515ET   Copyright (c) 2014 Dow Jones & Company, Inc. 




Recession Stalks Germany as Breakeven Rates Drop: Euro Credit – Businessweek

The falling cost of protecting against inflation in the German bond market portends a deeper slowdown in Europe’s largest economy, signalling the effects of the continent’s debt crisis are edging closer to the core. The two-year breakeven …

Euro-Zone Producer Price Inflation Slows – Wall Street Journal


Wall Street Journal

Euro-Zone Producer Price Inflation Slows
Wall Street Journal
Euro-zone producer price inflation slowed to its weakest rate in more than two years in May, pointing to a slowdown in consumer prices that would give the European Central Bank more room to cut its key interest rate.
Euro zone factory prices slip, fuel ECB rate cut callsReuters

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