Eurozone: Focus on CPI and unemployment data this week – RBC CM

Elsa Lignos, Senior Currency Strategist at RBC Capital Markets, suggests that the Eurozone markets focus this week will be on the release of CPI and unemployment data which are both out on Friday.

Key Quotes

“The effects of previous energy price falls begin to drop out of the HICP index in coming months, so headline inflation will begin to pick up as a result. The drag from the two main impacted categories of the inflation basket (transport and home heating) has already begun to ease, and that process should accelerate into the first half of next year. As a result, we see September’s HICP printing at 0.4% y/y, but with core inflation remaining unchanged at 0.8%.

Meanwhile the rate of decline in euro area unemployment has moderated in recent months although the overall trend is still downward. As a result, we see the unemployment rate remaining unchanged in August at 10.1%, which would represent the fifth consecutive month of no change.”