The headline release from the eurozone in Friday was the flash inflation rate for August. It is expected that it will ease to 2% in August, lower than the 2.1% that the markets had expected. We also saw the unemployment rate come in at 8.2% in July, which was the same as the previous month and in line with expectations. It is the lowest rate since November 2008.
Retail sales in Germany were extremely disappointing in July. A 0.2% fall had been expected, but sales actually dropped by 0.4%. This comes a month after a downwardly revised 0.9% rise in June. The euro didn’t do too well against sterling or the dollar, but movements were pretty quiet throughout the day.
Like the UK, we will see the Markit manufacturing PMI figures in Germany and the eurozone. Both are expected to dip a little to 56.1 and 54.6 respectively. The highlight of this week is the third estimate of the eurozone’s GDP growth rate for the second quarter of 2018. It is expected that growth will slow to 2.2% from 2.5% in the previous period.
