Eurozone key events for next week - Danske

According to analysts from Danske Bank, the main event next week is the European Central Bank meeting. Also, retail sales, Sentix Investor Confidence and German industrial production data will be released. 

Key Quotes: 

“In the euro area, the main event next week is the ECB meeting on Thursday. We expect the ECB to remain on hold at the meeting. The ECB has stressed that more data is needed before the growth and inflation outlook can be fully reevaluated. Initial figures suggest resilience in economic sentiment following the UK’s decision to leave the EU, so we expect the ECB to maintain its current stance. In addition, we expect QE purchases to be maintained at the current pace, although we believe it will eventually extend the programme beyond March 2017. Regarding TLTRO II, the ECB has stated ‘additional demand could be expected for the forthcoming TLTRO II operations’, which supports our view that the ECB will maintain a patient stance until the allotment results of the second TLTRO II auctions (due to be published on 22 September).”

“On Monday, we are due to get the retail sales figures for July. Retail sales increased 0.4% m/m in May, with a 0.0% m/m change in June. Post the Brexit vote, economic indicators have so far been fairly resilient. The German retail figures for July surprised on the upside with a 1.7% m/m increase in July from June. We expect an increase for the euro area in line with the German increase, confirming the economic resilience.”

“Sentix Investor Confidence is also scheduled for release on Monday. Sentix rose from July to 4.2 in August and we expect the positive trend to continue with an increase to 4.7 in September, as positive risk sentiment is on the increase.”

“On Wednesday, the German industrial production figures for July are due to be released. German industrial production is especially important following the Brexit vote due to the size of the German manufacturing sector. The industrial production figures for June showed strength and we expect July figures to follow a similar trend and confirm the economic resilience.”