15 April 2002, 11:27 OUTLOOK Euro zone data in coming week to show recovery still fragile
LONDON (AFX) - Euro zone economic figures due out over this week
are expected to show that recovery in the area remains fragile despite
favourable early signs, economists said.
Core inflation may pick up while industrial output is unlikely to
have improved by any significant degree just yet, they added.
The key data for the week is the euro zone March HICP numbers, they
said.
"We do not expect a revision to the flash estimate but core
inflation could edge higher," economists at UBS Warburg wrote.
While the consensus forecast echoed this view, some economists see
the core rate racing to 0.7 pct.
Data out of Spain, the Netherlands, Belgium and Greece all suggest
inflation edged higher or was at least stable in March. Preliminary
evidence suggests higher energy prices but lower food costs.
But core inflation may rise ifthe data coming out of Germany, Italy
and France is any indication, economists said.
Bank of America economist Lorenzo Codogno noted that German
February industrial production should remain relatively weak although,
"a decent pick up in activity is still expected over the next couple of
months.
"The construction sector should have posted a decent rebound due to
mild weather conditions. Intermediate goods should have also performed
decently well," he said.
The median forecast is for a 0.4 pct rise on the month and a 4.3
pct decline on the year. However, estimates were wide ranging with some
economists expecting a jump of 1.4 pct in month-on-month terms while
others predicted a fall of 0.7 pct.
Euro zone-wide industrial production in February is expected to
have recovered from a flat reading the previous month, suggesting that
a recovery is on the cards, economists said.
A leading sentiment indicator, the ZEW index is seen to have
registered a rise in April although concerns over higher oil prices is
likely to have kept gains in check, economists said.
In France, household consumption is likely to show another monthly
rise but a reduced pace.
"Car sales rebounded in March, but in seasonally adjusted terms,
the performance was poor, dragging on overall seasonally adjusted
consumption," Codogno said.
According to the median of analyst forecasts, March household
consumption grew by 0.2 pct from February and by 0.8 pct from a year
earlier. However, one estimate was as low as -0.6 pct on the month.
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