Archive

Euro area Unemployment Rate 6.4% (consensus 6.5%) in Nov-23

- The Euro area unemployment rate for November 2023 was 6.4%, slightly below the consensus forecast of 6.5%, indicating a marginal improvement in joblessness.
- The unemployment rate was 0.13 percentage points below the one-year average and 0.23 percentage points below the long-run average, suggesting a relatively tight labour market situation.

EA: Inflation Springs as Energy Fades

• EA inflation undershot expectations for the fourth consecutive month but smashed the downtrend with a 0.5pp rise to 2.9% for Dec-23.
• The run of downward surprises means Dec-23 inflation is 0.8pp lower than expected in Oct-23. However, it is close to expectations a year earlier.
• Fading energy price disinflation drove the upside move in a timely reminder that all the EA’s other special aggregates remain well above 2%, discouraging ECB rate cuts.

By Philip Rush

EA: German Reflation About to Blow

• The final EA HICP inflation print confirmed the surprisingly soft flash of 2.4% for Nov-23. Core inflation was also steady at 3.56%, while the HICPxT unsurprisingly hit 2.29%.
• The downtrend is still set to break in December on base effects from last year’s energy price subsidies in Germany. Underlying inflation mostly remains around 2% (annualised).
• Italy dipped low, which would warrant rate cuts in the unlikely event that it broadens and sustains. Wage pressures should pose resistance and discourage cuts until mid-24.

By Philip Rush

Euro area Private Labour Costs 5.7% y-o-y in Q3-23

- Euro area private labour costs recorded a year-on-year growth of 5.7% in Q3-23, surpassing the previous quarter's 4.5% and indicating a notable acceleration.
- The current data reveals an increase of 0.48 percentage points above the one-year average and 2.34 percentage points above the long-run average, suggesting a robust rise in labour costs compared to historical trends.