The Weekly BriefContributor Global Markets Insights Strategy Team
While market volatility has increased in recent weeks, it is important for investors to stay focused on the fundamentals
Last week’s data releases show that the eurozone continues to expand at a healthy pace, with real GDP for the last quarter of 2017 increasing by 2.7% year on year (y/y). Importantly, this expansion has been broad based across the region. In the last year, growth in France, Germany and Italy accelerated significantly, while in Spain it remained strong. Recent data suggests that these levels can be sustained. The January eurozone composite Purchasing Manager’s Index came in at 58.8, a level that has historically been consistent with GDP growth above 2% (y/y). Robust global growth combined with improving domestic economies should remain supportive of European equities over the coming year.
Real GDP growth in the eurozone remains strong
% change year on year
Source: German Federal Statistical Office, INE, INSEE, Istat, Thomson Reuters Datastream, J.P. Morgan Asset Management. Data as of 16 February 2018.
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