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danielkral.bsky.social
Europe macro at Oxford Economics. Opinions my own.
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Is France facing a Greek-style sovereign debt crisis? No. At the height of the € debt crisis, Greek govt was spending almost 20% of all its revenue on interest payments. France is spending less than 4% (even less when subtracting interest paid on debt held by central bank).

submitted 97 days ago • 1 comment

Fixed investment has been hammered by high interest rates & weak demand. Germany is the worst performer (no surprises), France propped up by fake IP and Spain & Neth. around pre-pandemic level (way below trend). After Superbonus-fuelled bonanza in Italy comes the inevitable - a protracted recession.

submitted 97 days ago • 0 comments

Current cold spell across Europe drives an earlier drawdown from gas storages than in previous years, as wholesale prices hit the highest in a year. Gazprom cutting off Austria this week and uncertainty over Ukraine transit route next year means Europe again bidding up spot LNG.

submitted 108 days ago • 0 comments

Hard to see how the EU would benefit from a big US-China trade war. Chinese exporters would seek to replace lost US market and flood the world with goods at dumping prices, undermining EU companies at home and abroad - worsening EU trade balance & compounding the "China shock" for industry.

submitted 110 days ago • 0 comments

Or we can recycle Eurozone's large private sector surpluses into government deficits and allow the debt-to-GDP ratio and the ECB's balance sheet to balloon up, keeping debt servicing costs contained. Having our welfare state with no growth. Like, you know, Japan.

submitted 110 days ago • 0 comments

@ec.europa.eu analysis points to a sizeable fiscal tightening in EU next year. RRF / EU funds key offset in large recipients (CEE & South Europe). Largest tightening planned in FRA but unlikely to fully materialize. Large loosening in DNK, LAT, HUN (big assumptions on frozen EU funds in HUN tho).

submitted 110 days ago • 0 comments

IRL, BEL, NLD have the largest direct trade exposure to US. But this is distorted by IRL contract manufacturing and large Dutch & Belgian ports handling much of EU trade. Also, their large pharma surpluses are rarely mentioned. This leaves GER, FIN, SWE, ITA & auto-heavy CEE economies most at risk.

submitted 111 days ago • 1 comment