Eurozone - Better growth, but less inflation

        Analysts at BBH note that Eurozone reported better growth, but less inflation, than expected as the first look at Q3 GDP showed a 0.6% increase, and Q2 was revised to 0.7% from 0.6%.

       “Growth is not the immediate challenge in the eurozone.  Unemployment also continues to fall.  At 8.9% in September, it is a new cyclical low.  That the August figure was revised to 9.0% from 9.1% underscores the trend improvement.”

       “On the other hand, price pressures eased.  The headline pace slipped to 1.4%, but the real challenge to the ECB comes from the core rate, even though it does not directly target it.  The core rate slipped to 0.9% from 1.1%.  This indicates that it is not just energy prices, which Draghi had warned would likely drag inflation lower in the near-term.  The key issue is what the ECB will do next September, as its course until then has been largely mapped out, with all the due caveats of its flexibility.”