Weekly Economic Briefings > Eurozone Weekly Economic Briefing > Eurozone

Since the roller-coaster start to the year, market sentiment has subsequently stabilised reflecting the renewed round of policy easing in Asia and in Europe. Increasingly, this is being reflected in the latest survey data. The hard data, meanwhile, have been much stronger throughout the first quarter reflecting the continued strength and resilience of euro area domestic demand. As a result, euro area GDP looks set to grow by 0.5% q/q in Q1 which would be its strongest performance in 12 months. On the policy front, the minutes of last months ECB meeting continue to suggest the ECB is focused on using its non-conventional measures to flatten the yield curve and push low interest rates out to longer maturities. While on the one hand, this suggests there is scope for the ECB to cut the deposit rate again if needed, it is also the case that growth has turned out much stronger than envisaged in March. This suggests there is no further monetary easing on the horizon for the time being.