Market Update
European Indexes Inch Higher In Cautious Trading, Natural Gas Ease
Bridgette Randall
12 Jun, 2023
Frankfurt
European markets traded higher in cautious trading ahead of rate decisions this week.
Major averages in London, Paris and Frankfurt advanced and bond yields edged slightly lower.
Investors are anticipating the European Central Bank to lift its policy rate by 25 basis points but market participants appear to be divided on the future rate path in the U.S.
The U.S. Federal Reserve is expected to announce its rate decision on Wednesday, the European Central Bank of Thursday and the Bank of Japan on Friday.
Resource and energy stocks traded lower after crude oil prices eased for the third day in a row on demand growth worries. Natural gas prices declined after traders took profit following a sharp rally in the previous week.
In the absence of economic news, investors debated recent economic data. The economy in the eurozone entered a technical recession after the first quarter growth was revised to a contraction of 0.1%, matching the performance in the previous quarter.
China's producer prices fell for the eighth month in a row and dropped at the sharpest pace in seven years in May, highlighting uneven and weak economic rebound and weak consumer demand.
Europe Indexes & Yields
The DAX index increased 0.7% to 16,058.96, the CAC-40 index increased 0.6% to 7,257.83 and the FTSE 100 index traded up 0.1% to 7,568.16.
The yield on 10-year German Bunds inched lower to 2.35%, French bonds traded lower to 2.89%, the UK gilts edged up to 4.26% and Italian bonds decreased to 4.07%.
The euro edged lower to $1.078, the British pound to $1.258 and the. Swiss franc to 90.36 cents.
Brent crude decreased $1.39 to $73.39 a barrel and the Dutch TTF natural gas decreased €2.66 to €29.39 per MWh.
Natural gas prices eased 8% after last week's rally of 35% and investors took profit despite falling supplies and weak demand in the region. U.S. natural gas supplies are diverted to the Asian markets because of growing demand for cooling to combat elevated temperatures.
Turkstream pipeline which transports natural gas from Russia to Turkey has been shut down for maintenance work.
Norway's Equinor delayed the restart of its Hammerfest LNG plant to June 14 because of technical difficulties.
Despite the restricted natural gas supply, storage facilities in the European Union are 70.4% full and the region's government is looking to rebuild its storage to 90% by November 1.
Europe Stock Movers
UBS Group AG increased 0.5% to CHF 18.29 after the Swiss bank said it has completed the purchase of Credit Suisse Group AG.
Novartis Group AG increased 1% to CHF 90.99 after the Swiss pharmaceutical company agreed to acquire Seattle-based biotech company Chinook Therapeutics for up to $3.5 billion.
Telecom Italia SpA declined 1.3% to €0.25 after the company received two revised offers from existing bidders for its NetCo unit.
Tullow Oil Plc declined 1.5% to 25.33 pence after the UK-based energy explorer said it is open to all possibilities for its oil field in Ivory Coast.
SES SA declined 15.60% to €4.71 after the Paris-based satellite company said its chief executive Steve Collar will leave the company at the end of June.
Frasers Group increased 0.4% to 687.50 pence after UK-based retailer said it has acquired 18.9% stake in the online electrical retailer AO World Plc for £75 million.
European Markets Fall Ahead of Rate Decisions Next Week
Bridgette Randall
09 Jun, 2023
Frankfurt
European markets traded in a tight range and investors remained on the sidelines ahead of rate decisions next week.
Benchmark indexes in London, Paris and Frankfurt traded with a downward bias and investors debated the rate path and reviewed the region's economy.
The Euro Area entered into a technical recession after GDP declined for two quarters in a row.
Inflation has been on the downward slide but prices are still rising at a faster pace than the 2% target set by the central bank.
The European Central Bank is expected to lift its benchmark rate by 25 basis points despite the recent weakening of price increases by sharp fall in energy prices.
Goods inflation has cooled but service prices are rising at a faster pace and core inflation has stayed between 4% and 5%.
The ongoing challenging economic conditions were visible in the latest industrial production data.
Italy's industrial production declined 1.8% from the previous month in April and dropped 7.2% from a year ago, the statistical agency ISTAT reported Friday.
For the week, the DAX index declined 0.9%, the CAC-40 index dropped 1% and the FTSE 100 index eased 0.6%.
For the year so far, the DAX index has gained 13%, the CAC-40 advanced 9.2% and the FTSE 100 index edged up 0.1%.
Turkish lira declined to 23.50 against the U.S. dollar and dropped to a new low and extended loss to 18% since May 28 when President Erdogan was reelected.
Europe Indexes & Yields
The DAX index decreased 0.3% to 15,951.57, the CAC-40 index declined 0.2% to 7,208.63, and the FTSE 100 index inched lower 0.4% to 7,570.66.
The yield on 10-year German Bunds inched lower to 2.41%, French bonds traded lower to 2.96%, the UK gilts edged down to 4.21% and Italian bonds decreased to 4.19%.
The euro edged lower to $1.072, the British pound to $1.252 and the. Swiss franc to 90.17 cents.
Crude oil is set to decline for the second week in a row as China demand growth worries outweighed the additional production cuts announced by Saudi Arabia last weekend.
China's producer prices fell at the sharpest pace in May in seven years and dropped for the eighth month in a row and consumer prices rose modestly in the month.
Brent crude decreased $0.14 to $75.81 a barrel and the Dutch TTF natural gas increased €1.21 to €28.15 per MWh.
Europe Stock Movers
Croda International declined 10.2% to 5,254.0 pence after the company reported weaker-than-expected results.
The chemical company estimated pre-tax profit of £143 million for the period between January and May 2023 and pre-tax profit for the full-year 2023 between £370 million and £400 million.
The weak outlook dragged chemical stocks.
Energy and resource stocks traded lower after crude declined for the second week in a row.
Shell Plc, BP Plc, Repsol, Eni and TotalEnergies declined between 0.3% and 0.6%. Glencore, Antofagasta, and Anglo American declined between o.2% and 0.5%.
Banks were also under pressure ahead of the rate decision next week.
Barclays, BNP Paribas, Deutsche Bank and UniCredit SpA declined between 0.6% and 1.2%.
China's Inflation Data Show Weak Demand and Uneven Recovery
Brian Turner
09 Jun, 2023
New York City
China's annual inflation edged slightly higher to 0.2% in May from 0.1% in April, the National Bureau of Statistics reported Friday.
On a monthly basis, inflation declined 0.2% from April when prices eased 0.1%.
Producer price index, a measure of wholesale prices, dropped 4.6% in May, faster than 3.6% in April, said the statistical agency in a separate report.
Prices fell for the eighth month in a row and dropped the most since February 2016.
On a monthly basis, producer prices in May fell for the second month in a row to 2.6% after falling 0.5% in April.
China's marginal consumer price inflation and producer price deflation is in sharp contrast to elevated inflation in other large economies.
China's wholesale prices declined because of the fall in international commodities prices and weak demand at home.
Major U.S. Averages Advanced, Global Markets May Face Rate Hikes Next Week
Barry Adams
08 Jun, 2023
New York City
Benchmark indexes climbed a tall wall of worries and investors debated rate path and health of the U.S. economy.
Treasury yields diverged and the yield spread between 2-year and 10-year notes widened but the yield on 30-year Treasury bonds hovered below 4.0%.
The Federal Reserve is scheduled to announce its rate decision after the 2-day meeting on June 14 and investors are divided with some forecasting rates to increase by 25 basis points.
Despite nine rate hikes over the last fourteen months, inflation has stayed above the Fed's target level of 2% and inflationary forces are weakening but price increases have spread to broader activities in the economy.
Lagged effects of rate hikes have still not worked its way to the broader economy, but elevated rates are likely to stay higher for longer.
The U.S. Federal Reserve, the Bank of Japan and the European Central Bank are scheduled to announce their rate decisions next week.
As earnings season for the first quarter is winding down, investors are revising expectations downward for the current quarter.
Stretched household budgets, because of elevated inflation, are likely to keep consumer spending in check for the rest of the year.
In addition, higher rates and tighter credit conditions after the recent collapse of several regional banks is also negatively impacting lending to small and medium-sized businesses.
Jobless Claims Advanced Third Week In a Row
The initial claims of jobless benefits increased to 261,000 in the week ending on June 3, the U.S. Department of Labor reported Thursday.
Weekly claims rose to the highest level since October 2021 and rose for the third week in a row.
Initial claims in the previous week were slightly revised higher to 233,000 from the previous estimate of 232,000.
Continuing claims declined 37,000 1.757 million from 1.794 million in the previous week.
U.S. Indexes & Yields
The S&P 500 index increased 0.5% to 4,288.97 and the Nasdaq Composite increased 0.9% to 13,224.58.
The yield on 2-year Treasury notes decreased to 4.45%, 10-year Treasury notes edged up to 3.79% and 30-year Treasury bonds rose 3.95%.
Crude oil traded lower after reports suggested that the U.S. and Iran are nearing a deal to ease sanctions in exchange for Iran reducing its uranium enrichment.
Crude oil increased $2.46 to $70.03 a barrel and natural gas prices increased 1 cent to $2.30 a thermal unit.
U.S. Stock Movers
GameStop Corp declined 21.6% to $20.46 after the company ousted chief executive Matthew Furlong and said Ryan Cohen will take over as executive chairman.
Signet Jewelers Limited dropped 9% to $63.01 after the specialty retailer lowered its revenue and earnings estimate for the full-year and forecasted weaker-than-expected second quarter revenue and operating income.
Lucid Group increased 3.1% to $6.60 after the electric vehicle maker's head of China operations Zhu Jiang said the company is preparing to launch its operations and enter the Chinese market.
HashiCorp Inc plunged 21.4% to $27.40 after the cloud computing company reported weaker than expected earnings.
In addition, the company announced its plan to reduce its workforce by 8% citing macroeconomic headwinds.
In Cautious Trading European Markets Lacked Direction
European markets traded in a narrow range and investors remained cautious ahead of rate decisions next week.
Bond yield in the region rose ahead of the European Central Bank's rate decision next week. The yields were also on the rise after the Bank of Canada and the Reserve Bank of Australia lifted rates by 25 basis points.
The U.S. Federal Reserve is also likely to lift its key lending rate by 25 basis points.
Tech stocks led decliners in the region and energy stocks led gainers in volatile trading in Paris, London and Frankfurt.
Market sentiment was cautious after the eurozone economy unexpectedly shrank in the first quarter of 2023 following a downwardly revised final quarter of 2022, dragging the region into technical recession.
Technical Recession in Euro Area
The Euro Area economy unexpectedly shrank 0.1% in the first quarter, the statistical office of the European Union Eurostat reported Thursday.
The GDP growth estimate for the final quarter of 2022 was revised to a decline of 0.1% from flat, indicating that the economy of the currency union entered a technical recession.
On an annual basis, seasonally adjusted GDP increased 1.0% in the first quarter of 2023, slower than the 1.8% rise in the final quarter of 2022.
Poland recorded the highest increase of 3.8% in GDP compared to the previous quarter, followed by 2.0% in Luxembourg and 1.6% in Portugal.
Ireland's GDP shrank the most in the currency union with a fall of 4.6%, followed by 2.1% decline in Lithuania and 0.7% decrease in the Netherlands.
GDP contracted 0.3% in Germany but expanded 0.5% in Spain, 0.2% in France and 0.6% in Italy.
Europe Indexes & Yields
The DAX index increased 0.2% to 15,991.76, the CAC-40 index increased 0.2% to 7,221.56, and the FTSE 100 index fell 0.3% to 7,599.74.
The yield on 10-year German Bunds inched higher to 2.46%, French bonds traded higher to 3.01%, the UK gilts edged up to 4.29% and Italian bonds increased to 4.26%.
The euro edged lower to $1.072, the British pound to $1.246 and the Swiss franc to 90.95 cents.
Brent crude increased $0.95 to $75.98 a barrel and the Dutch TTF natural gas increased €0.74 to €27.07 per MWh.
Europe Stock Movers
FirstGroup Plc soared 15.5% to 137.50 pence after the transportation company announced a stock buyback plan of £115 million.
The company also swung to a pre-tax profit in fiscal 2023 after revenue picked up.
RWS Holdings Plc increased 14.3% to or 259.80 pence after the company launched a stock repurchase plan of up to £50 million.
In the first-half, revenue increased and profit declined but the company confirmed that the full-year outlook is in line with market expectations.
Wizz Air Holdings Plc increased 0.2% to 2,784.0 pence after the deep discount airline said loss shrank in the fiscal 2023 on higher revenue.
The airline forecasted profitability in the fiscal year 2024.
Crest Nicholson Holdings Plc dropped 8.2% to 229.04 pence after the company reported weaker-than-expected revenues in the first-half but swung to a profit from a loss in the corresponding period a year ago.
Saint Gobain SA increased 1.2% to €56.73 after the French building materials company estimated fiscal 2023 operating margin between 9% and 11%.
Mitie Group Plc added 0.5% to 96.90 pence after the outsourcing company reported higher revenue but flat after-tax earnings.
Australia and Canada Lift Rates, India Holds
The Reserve Bank of India held its repo rate at 6.5% and the Bank of Canada and the Reserve Bank of Australia lifted their reference rates by 25 basis points.
Japan Q1 GDP Revised Higher
Japan's economic growth in the first quarter was revised to 0.7% from the previous estimate of 0.4%, the Cabinet Office reported Thursday.
On an annual basis, GDP growth was revised to 2.7% from 1.6% in the preliminary estimate.
Capital spending was revised higher to 1.4% from 0.9% in the preliminary estimate, private demand rose 1.2% from 0.8% and domestic demand was revised higher to 1.0% from 0.7%.
Upward revision in the Japan's GDP surprised economists and benchmark indexes in Tokyo trade at 33-year highs.
The Japanese yen strengthened 0.1% to 139.97 against the U.S. dollar after the release of data.
Movers: GameStop, HashiCorp, Lucid Group, Signet Jewelers
Scott Peters
08 Jun, 2023
New York City
The S&P 500 index increased 2.58 points to 4,269.62 and the Nasdaq Composite increased 0.2% to 13,135.62.
The yield on 2-year Treasury notes decreased to 4.45%, 10-year Treasury notes edged up to 3.79% and 30-year Treasury bonds rose 3.95%.
GameStop Corp declined 21.6% to $20.46 after the company ousted chief executive Matthew Furlong and said Ryan Cohen will take over as executive chairman.
Net sales in the first quarter ending in April declined to $1.237 billion from $1.378 billion and net loss shrank to $50.5 million from $157.9 million and diluted loss per share fell to 17 cents from 52 cents a year ago.
Signet Jewelers Limited dropped 9% to $63.01 after the specialty retailer lowered its revenue and earnings estimate for the full-year and forecasted weaker-than-expected second quarter revenue and operating income.
Sales in the fiscal first quarter ending in April declined 9.3% to $1.7 billion and same store sales declined 13.9% from a year ago.
Sales in North America declined 8.4% to $1.6 billion and same store sales fell 14.2% from a year ago.
The company swung net income attributable to shareholders to $88.8 million from a loss of $92.1 million and diluted earnings per share was $1.79 compared to ($1.89).
The company declared quarterly dividend per share of 23 cents to shareholders on record July 28 and payable on August 25.
The company repurchased $39.1 million of its shares in the first quarter.
Lucid Group increased 3.1% to $6.60 after the electric vehicle maker's head of China operations Zhu Jiang said the company is preparing to launch its operations and enter the Chinese market.
HashiCorp Inc plunged 21.4% to $27.40 after the cloud computing company reported weaker than expected earnings.
Revenue in the first quarter ending in April increased 37% to $138.0 million and net loss shrank to $53.2 million from $82.2 million and diluted loss per share fell to 28 cents from 43 cents a year ago.
The company estimated fiscal second quarter revenue between $137 million and $139 million and non-GAAP loss per share between 14 cents and 16 cents.
The company estimated full-year revenue between $564 million and $570 million and non-GAPP loss per share between 24 cents and 27 cents.
In addition, the company announced its plan to reduce its workforce by 8% citing macroeconomic headwinds.
With Stocks On Hold, U.S. Treasury Yields Show Divided Bond Market
Barry Adams
08 Jun, 2023
New York City
Benchmark indexes traded sideways and investors debated rate path and health of the U.S. economy.
Treasury yields diverged and the yield spread between 2-year and 10-year Treasury notes widened, indicating rising stress in the bond market ahead of the rate decision next week.
The Federal Reserve is scheduled to announce its rate decision after the 2-day meeting on June 14. Investors are divided with some forecasting rate to increase by 25 basis points.
Despite nine rate hikes over the last fourteen months, inflation has stayed above the Fed's target level of 2%.
Lagged effects of rate hikes have still not worked its way to the broader economy, but elevated rates are likely to stay higher for longer.
As earnings season for the first quarter is winding down, investors are revising expectations downward for the current quarter.
Stretched household budgets because of elevated inflation are likely to keep consumer spending in check for the rest of the year.
In addition, higher rates and tighter credit conditions after the recent collapse of several regional banks is also negatively impacting lending to middle America.
Jobless Claims Advanced Third Week In a Row
The initial claims of jobless benefits increased to 261,000 in the week ending on June 3, the U.S. Department of Labor reported Thursday.
Weekly claims rose to the highest level since October 2021 and rose for the third week in a row.
Initial claims in the previous week were slightly revised higher to 233,000 from the previous estimate of 232,000.
Continuing claims declined 37,000 1.757 million from 1.794 million in the previous week.
U.S. Indexes & Yields
The S&P 500 index increased 2.58 points to 4,269.62 and the Nasdaq Composite increased 0.2% to 13,135.62.
The yield on 2-year Treasury notes decreased to 4.45%, 10-year Treasury notes edged up to 3.79% and 30-year Treasury bonds rose 3.95%.
Crude oil increased $0.36 to $72.93 a barrel and natural gas prices increased 1 cent to $2.34 a thermal unit.
U.S. Stock Movers
GameStop Corp declined 21.6% to $20.46 after the company ousted chief executive Matthew Furlong and said Ryan Cohen will take over as executive chairman.
Signet Jewelers Limited dropped 9% to $63.01 after the specialty retailer lowered its revenue and earnings estimate for the full-year and forecasted weaker-than-expected second quarter revenue and operating income.
Lucid Group increased 3.1% to $6.60 after the electric vehicle maker's head of China operations Zhu Jiang said the company is preparing to launch its operations and enter the Chinese market.
HashiCorp Inc plunged 21.4% to $27.40 after the cloud computing company reported weaker than expected earnings.
In addition, the company announced its plan to reduce its workforce by 8% citing macroeconomic headwinds.
Europe Movers: Crest Nicholson, FirstGroup, Mitie Group, RWS Holdings, Saint Gobain, Wizz Air
Bridgette Randall
08 Jun, 2023
Frankfurt
The DAX index increased 0.2% to 15,998.35, the CAC-40 index increased 0.2% to 7,220.64, and the FTSE 100 index inched lower a fraction to 7,623.46.
The yield on 10-year German Bunds inched higher to 2.46%, French bonds traded higher to 3.01%, the UK gilts edged up to 4.29% and Italian bonds increased to 4.26%.
FirstGroup Plc soared 15.5% to 137.50 pence after the transportation company announced a stock buyback plan of £115 million.
The company also swung to a pre-tax profit in fiscal 2023 after revenue from continued operations increased to £4.7 billion from £4.6 billion a year ago.
Total revenue declined to £4.8 billion from £5.6 billion and adjusted attributable profit surged to £82.1 million from £45.9 million a year ago.
RWS Holdings Plc increased 14.3% to or 259.80 pence after the company launched a stock repurchase plan of up to £50 million.
In the first-half, revenue increased and profit declined but the company confirmed that the full-year outlook is in line with market expectations.
Revenue in the first-half ending in March increased to £366.3 million from £357.3 million and reported profit before-tax declined to £28.7 million from £32.9 million and basic earnings per share decreased to 5.4 pence from 6.1 pence a year ago.
The company increased its interim dividend to 2.40 pence from 2.25 pence a year ago.
Wizz Air Holdings Plc increased 0.2% to 2,784.0 pence after the deep discount airline said loss shrank in the fiscal 2023 on higher revenue.
Revenue in the fiscal year 2023 ending in March increased to 3.9 billion from 1.7 billion and reported loss shrank to 535.1 million from 642.5 million and load factor improved to 87.4% from 78.1%.
The airline forecasted profitability in the fiscal year 2024.
Crest Nicholson Holdings Plc dropped 8.2% to 229.04 pence after the home builder reported weaker-than-expected revenues in the first-half but swung to a profit from a loss in the corresponding period a year ago.
Revenue in the first-half ending in April declined to £282.7 million from £364,7 million and swung to a pre-tax profit of £28.4 million from a loss of £52.5 million.
The company confirmed pre-tax profit in the fiscal year 2023 in-line with market expectation of £73.7 million.
Saint Gobain SA increased 1.2% to €56.73 after the French building materials company estimated fiscal 2023 operating margin between 9% and 11%.
Mitie Group Plc added 0.5% to 96.90 pence after the outsourcing company reported higher revenue but flat after-tax earnings.
Revenue in the fiscal year 2023 increased to £4.05 billion from £3.99 billion a year ago and the company won a total contract value of £4.3 billion with renewal rate of over 90% and book-to-bill ratio of 105%.
Net income in the year jumped to 91 million from 31 million and basic earnings per share rose to 6.8 pence from 2.2 pence a year ago.
The company announced a new £50 million stock repurchase plan in April and the purchase of £25 million in progress.
European Markets Turn Cautious, Technical Recession In Eurozone
Bridgette Randall
08 Jun, 2023
Frankfurt
European markets traded in a narrow range and investors remained cautious ahead of rate decisions next week.
Bond yield in the region rose ahead of the European Central Bank's rate decision next week. The yields were also on the rise after the Bank of Canada and the Reserve Bank of Australia lifted rates by 25 basis points.
The U.S. Federal Reserve is also likely to lift its key lending rate by 25 basis points.
Tech stocks led decliners in the region and energy stocks led gainers in volatile trading in Paris, London and Frankfurt.
Market sentiment was cautious after the eurozone economy unexpectedly shrank in the first quarter of 2023 following a downwardly revised final quarter of 2022, dragging the region into technical recession.
Technical Recession in Euro Area
The Euro Area economy unexpectedly shrank 0.1% in the first quarter, the statistical office of the European Union Eurostat reported Thursday.
The GDP growth estimate for the final quarter of 2022 was revised to a decline of 0.1% from flat, indicating that the economy of the currency union entered a technical recession.
On an annual basis, seasonally adjusted GDP increased 1.0% in the first quarter of 2023, slower than the 1.8% rise in the final quarter of 2022.
Poland recorded the highest increase of 3.8% in GDP compared to the previous quarter, followed by 2.0% in Luxembourg and 1.6% in Portugal.
Ireland's GDP shrank the most in the currency union with a fall of 4.6%, followed by 2.1% decline in Lithuania and 0.7% decrease in the Netherlands.
GDP contracted 0.3% in Germany but expanded 0.5% in Spain, 0.2% in France and 0.6% in Italy.
Europe Indexes & Yields
The DAX index increased 0.2% to 15,998.35, the CAC-40 index increased 0.2% to 7,220.64, and the FTSE 100 index inched lower a fraction to 7,623.46.
The yield on 10-year German Bunds inched higher to 2.46%, French bonds traded higher to 3.01%, the UK gilts edged up to 4.29% and Italian bonds increased to 4.26%.
The euro edged lower to $1.072, the British pound to $1.246 and the Swiss franc to 90.95 cents.
Brent crude increased $0.72 to $77.68 a barrel and the Dutch TTF natural gas increased €2.15 to €28.48 per MWh.
Europe Stock Movers
FirstGroup Plc soared 15.5% to 137.50 pence after the transportation company announced a stock buyback plan of £115 million.
The company also swung to a pre-tax profit in fiscal 2023 after revenue picked up.
RWS Holdings Plc increased 14.3% to or 259.80 pence after the company launched a stock repurchase plan of up to £50 million.
In the first-half, revenue increased and profit declined but the company confirmed that the full-year outlook is in line with market expectations.
Wizz Air Holdings Plc increased 0.2% to 2,784.0 pence after the deep discount airline said loss shrank in the fiscal 2023 on higher revenue.
The airline forecasted profitability in the fiscal year 2024.
Crest Nicholson Holdings Plc dropped 8.2% to 229.04 pence after the company reported weaker-than-expected revenues in the first-half but swung to a profit from a loss in the corresponding period a year ago.
Saint Gobain SA increased 1.2% to €56.73 after the French building materials company estimated fiscal 2023 operating margin between 9% and 11%.
Mitie Group Plc added 0.5% to 96.90 pence after the outsourcing company reported higher revenue but flat after-tax earnings.
OECD Lifted Global Economic Growth Outlook
Brian Turner
08 Jun, 2023
New York City
Global economic growth is likely to pick up in the remainder of 2023, but the recovery is expected to be anemic, the OECD said in its quarterly update released Wednesday.
GDP growth in 2023 was revised higher to 2.7% from 2.6% but the outlook for 2024 was left unrevised at 2.9%.
Despite the slight pick up in the global growth, downside risks persists because of the uncertainties related to the Ukraine war, higher inflation and milder weather in Europe may not be repeated next year.
GDP growth in the Euro Area is likely to pick up from 0.9% in 2023 to 1.5% in 2024 because the sharp decline in energy prices is expected to increase real income and contribute to acceleration in economic growth.