Eurozone growth, inflation on benign path

Eurozone growth and inflation remain on a benign path, a slew of fresh data suggested on Friday, supporting economists' bets that no further European Central Bank rate cuts are coming in the near future.

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Growth has been surprisingly resilient to trade uncertainty, thanks in part to a tight labour market, and inflation has been hovering near the ECB’s 2% target all year, in line with longstanding projections.

While national data show big differences across the bloc, from a booming Spain to Germany's struggles to escape years of stagnation, the combined picture suggested steady inflation and continued, even if lukewarm, economic growth.

“None of today’s large number of varied data releases suggests that growth or inflation will noticeably deviate from the ECB's baseline view in the near-term,” Mateusz Urban at Oxford Economics said.

Inflation held steady at 0.8% in France, accelerated to 2.6% in Germany, eased a touch to 3.1% in Spain, and slipped to 1.1% from 1.3% in Italy.

When combined with numbers from other smaller countries, the data suggested that inflation in the 20-nation bloc as a whole was unchanged at 2.1%, a nonevent for the ECB when rate-setters meet on December 18.

Policymakers’ sanguine view is also likely to be supported by the ECB’s own consumer expectations survey, which pointed to unchanged price growth expectations three and five years out, and indicated broadly steady income and spending plans.