1 May 2015
Eurozone GDP and rates outlook – Goldman Sachs
FXStreet (Barcelona) - According to Goldman Sachs, Eurozone GDP growth might stand at 1.5% in 2015 and 1.7% in 2016, and ECB might maintain its overnight rates between 0% to -0.05% till Q3, 2017.
Key Quotes
“For the Euro area as a whole, we forecast growth of 1.5% in 2015 and 1.7% in 2016. The growth outlook at the country level still shows divergent trajectories, with growth below 1% in Italy, but somewhat above that threshold in Germany and Spain.”
“We forecast Euro area growth to move higher, driven by modest improvements across all major components of domestic demand. Support from monetary policy will also contribute to that recovery. Still, the list of necessary adjustments in the periphery remains long, ranging from cleaning up the banking system and labour market reform to increasing competitiveness.”
“The refi/depo rates are at 0.05%/-0.20%. The ECB announced ABS and covered bond purchases starting in October and an expansion of its asset purchase programme to include sovereign debt. The purchase program started on March 9, and bonds with a negative yield as low as the deposit rate (-20bp) will be purchased. Total purchases will be made at a rate of €60bn per month. The programme is “intended” to end September 2016.”
“We expect the ECB to maintain Euro area overnight rates (EONIA) at close to their current levels (between 0% and -0.05%) until 2017Q3.”
Key Quotes
“For the Euro area as a whole, we forecast growth of 1.5% in 2015 and 1.7% in 2016. The growth outlook at the country level still shows divergent trajectories, with growth below 1% in Italy, but somewhat above that threshold in Germany and Spain.”
“We forecast Euro area growth to move higher, driven by modest improvements across all major components of domestic demand. Support from monetary policy will also contribute to that recovery. Still, the list of necessary adjustments in the periphery remains long, ranging from cleaning up the banking system and labour market reform to increasing competitiveness.”
“The refi/depo rates are at 0.05%/-0.20%. The ECB announced ABS and covered bond purchases starting in October and an expansion of its asset purchase programme to include sovereign debt. The purchase program started on March 9, and bonds with a negative yield as low as the deposit rate (-20bp) will be purchased. Total purchases will be made at a rate of €60bn per month. The programme is “intended” to end September 2016.”
“We expect the ECB to maintain Euro area overnight rates (EONIA) at close to their current levels (between 0% and -0.05%) until 2017Q3.”