- European economy shows poor performance in first half of 2016
The European economy did not perform well with political uncertainty and weak macroeconomic indicators in the first half of the year.
Political uncertainty with the Brexit vote, turmoil in the banking sector, weak growth momentum and apathetic low inflation are considered to be the main problems for Europe.
All in all, the Brexit decision and the possible effects of developments in the global economy will continue to be closely monitored by market and investors in the second half of the year.
- Eurozone flash PMI edged up to seven-month high
The euro area economy continued to expand at a steady pace in August. At 53.3 points, up from 53.2 in July, the flash estimate of the Eurozone market’s Purchasing Manager Index (PMI) inched up to a seven-month high.
But in contrast, Eurozone consumer confidence weakened. Figures from the European Commission show that Eurozone consumer confidence fell unexpectedly in August. The Commission’s initial reading on sentiment fell from -7.9 to -8.5, the lowest since April’s reading of -9.3 while economists forecasted a reading of -7.7.
- News from Germany
Germany's gross domestic product (GDP) rose by 0.4 percent in the second quarter, compared with the first quarter of the year, the Federal Statistics Office (Destatis) said Friday in its second quarter growth estimate.
GDP was supported by a rise in exports and household consumption.
Growth was better than expected but failed to match the first quarter’s 0.7 percent growth.
According to the Munich-based Institute for Economic Research (Ifo),
German industry is again anticipating fewer orders from abroad. Ifo exports expectations fell from 5.0 balance points in July to 4.7 points in August.
-The week ahead
This week, markets will continue to monitor the ECB's Governing Council Members’ speeches.
On the data side, unemployment data, flash estimate Euro area inflation and industrial producer prices will be on the top of the agenda for the markets.