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Intesa Sanpaolo : Euro area and USA

Intesa Sanpaolo : Euro area – For the time being, data are confirming expectations for a much smaller contraction of growth in 4Q than in 2Q.

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Weekly Economic Monitor – 20. November 2020 

Intesa Sanpaolo – Research Department


For what concerns 2021, there is both good news (the vaccines make a strong recovery in 2H 2021 more likely) and bad (NGEU still on hold due to the Polish and Hungarian vetoes).

The week’s market movers

In the euro area, the round of November confidence surveys (PMI indices and EU Commission survey for the Eurozone, German Ifo, French INSEE, and Istat surveys in Italy) should outline a sharp correction, in the services sector in particular, hit hardest by the restrictive measures put in place in most euro area countries. The second reading of national accounts data for 3Q in Germany and France will confirm the sharp rebound over the summer months, although survey data (as also high frequency indicators) point to a potential new contraction in all the major countries in the closing stages of the year.

This week, focus in the United States will be on the flash PMI indices, expected to stay in expansionary territory, while correcting compared to October, especially in the nonmanufacturing sector. Consumer confidence is forecast to worsen in November, due to the deterioration of the health picture and to the disappointing outcome of the election for the Republicans, to the detriment of their optimism. Personal spending, personal income, orders of durable goods, and new home sales, are all forecast to increase, sending moderately positive indications for GDP growth in 4Q 2020. The minutes of the November FOMC meeting should shed light on potential changes to the asset purchase programmes.


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Source: BONDWorld