Analysts at ABN AMRO highlighted that considering the deterioration in the contribution of net exports to growth in Q3, domestic demand growth probably strengthened that quarter in the Eurozone.
Key quotes
“We think this pick-up will be temporary and we expect slowdown in Q4. Private consumption growth will probably weaken as labour market conditions are deterioration.”
“Besides private consumption, fixed investment is also expected to slow down as a result of the ongoing weakness in exports and industrial production since the start of last year. Indeed, business surveys suggest that the weakness in manufacturing has started to spill over to the services sector.”
“Looking forward, we expect GDP growth to slow further – to around zero – as domestic demand growth should slow down.”
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