Here’s how the European Central Bank or ECB could unwind or reduce its balance sheet plus what is the new normal for the ECB?

The European Central Bank (ECB) only started its Quantitative Easing (or QE) program in March 2015 in order to fight ultralow inflation in the Eurozone (also called the Euro Area). It somewhat worked by weakening the Euro (€), increasing exports, giving the stock market a boost and drastically lowering financing costs for European governments and corporations. This caused the ECB balance sheet to soar over €4.5 trillion or 45% of Eurozone GDP.

ECB Balance Sheet until November 2018
Data Source: ECB

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Eurozone Q3 2018 GDP up by 0.2% and European Union Q3 2018 GDP up by 0.3%, both lowest since 2013; Italy grew 0%; Eurozone economic sentiment falls for the 10th consecutive month

Seasonally adjusted GDP rose by 0.2% in the Eurozone or Euro Area and by 0.3% in the European Union (EU) during the third quarter of 2018, compared with the previous quarter, according to a preliminary flash estimate published by Eurostat, the statistical office of the European Union. In the second quarter of 2018, GDP had grown by 0.4% in the euro area and by 0.5% the European Union.

Q3 2018 GDP Eurozone and EU
Source: Eurostat

Continue reading “Eurozone Q3 2018 GDP up by 0.2% and European Union Q3 2018 GDP up by 0.3%, both lowest since 2013; Italy grew 0%; Eurozone economic sentiment falls for the 10th consecutive month”

Here’s how the demographic and economic statistics look for candidate members of the European Union

We will be publishing a number of statistics for the United Kingdom (and the European Union) over the next few days in the run up to a major piece we will be publishing on the real economics of Brexit.

Montenegro, the former Yugoslav Republic of Macedonia, Albania, Serbia, Turkey, Bosnia and Herzegovina and Kosovo are countries on the road to join the European Union.

European Union Membership 2018
Compiled by thistimeitisdifferent.com

 

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Euro Area or Eurozone Money Velocity seems to be shockingly low

We couldn’t find any official Money Velocity numbers for the Euro Area (Eurozone) so calculated it using the Equation of Exchange

Equation of Exchange

MV=PQ

Money Supply (M) * Money Velocity (V) = Price level (P) * Real economic output (Q)

Which means Money Supply * Money Velocity = Nominal GDP

Therefore, Money Velocity = Nominal GDP/Money Supply

We have the numbers for both Money Supply (from OECD – Organization for Economic Co-operation and Development) and Nominal GDP (from Eurostat) for the Euro Area.

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The European Union (and not China or the United States) accounted for the most trade in goods and services combined together

We will be publishing a number of statistics for the United Kingdom (and the European Union) over the next few days in the run up to a major piece we will be publishing on the real economics of Brexit.

The European Union (EU28 or EU) accounted for around one sixth of world trade in goods in 2016, with a 16.3% share of exports and a 15.0% share of imports. Turning to services the EU28’s contribution to world trade (mainly due to the United Kingdom which is leaving the European Union) was even greater, totalling 24.7% of exports and 21.1% of imports.

EU Share of total world trade
Data Source: Eurostat, the International Monetary Fund (IMF) and the World Trade Organization (WTO)

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Eurozone Q2 2018 GDP up by 0.3% and European Union Q2 2018 GDP up by 0.4% as Household saving rate falls to the lowest in over a decade

Seasonally adjusted GDP rose by 0.3% in the Eurozone and by 0.4% in the European Union (EU28) during the second quarter (Q2) of 2018, compared with the previous quarter, according to a preliminary flash estimate published by Eurostat, the statistical office of the European Union.

EU GDP until Q2 2018 chart
Source: Eurostat

Continue reading “Eurozone Q2 2018 GDP up by 0.3% and European Union Q2 2018 GDP up by 0.4% as Household saving rate falls to the lowest in over a decade”