ECB's Christmas Present Is Higher Growth Forecast

With the flash PMI surveys from both services and manufacturing out for December, the ECB is about to enjoy Christmas policy meeting in the relaxed and cheerful mood.

The economic activity in the Eurozone picked up strongly in December, with France being a particularly on a positive wave. While services activity eased off the peak in December, the manufacturing PMI rocked rising to 208-month high. 

Let me compute quickly, that is more than 17-year high.

Adding to this is the manufacturing in Germany. German manufacturing sector has already been strongly on the upside for some time now, but the December reading of 63.3 has sent it to fresh all-time high. Adding to that the services PMI rose to 24-months or 2-years high in December.

Summed up, the Eurozone manufacturing rose also to an all-time high with the economic growth now set to be higher than expected. 

The GDP growth rates are set to be upgraded by the ECB in December. Private research institution like IHS/Markit or German IFO Institute now all predict higher GDP growth rates for countries of the Eurozone.

German IFO Institute expects German GDP to rise 2.3 percent this year, followed by a 2.6 percent upturn in 2018 and 2.1 percent in 2019. IHS Markit said it expects fourth-quarter growth rates of 1.0 percent for Germany and 0.7-0.8 percent for France.

Draghi’s Christmas present for the people of the Eurozone will be his faith and conviction that accelerating economic growth rate will bring prosperity for the people. Also to all of those who did not invest in Bitcoin.