The euro-area economy is on a weak footing as it faces perilous uncertainties in 2019, from home-grown political difficulties to global stock-market turmoil and trade wars.
The first significant batch of data released at the start of the year showed inflation was lower than expected in December and confirmed earlier reports that growth in manufacturing and services eased to the weakest since 2014. Weaker inflation underlines policy makers’ stance that any exit from unconventional stimulus must be gradual. Consumer prices increased an annual 1.6 percent in December, down from 1.9 percent in November.
The euro-area economy stumbled at the end of 2018 as violent protests in France depressed output and consumption, political instability continued to rock Italy and Germany’s car industry struggled to rebound from changes in regulation in the fall.
Data next week will give a better picture of the state of the euro area, with reports on industrial production from the region’s four largest economies and economic confidence in the 19-nation bloc.
