Chart 1: Export orders are particularly weak in the euro area PMI index, new export orders in the manufacturing sector
65
65 Euro area
Global
United States
China
60
60
55
55
50
50
45
45
40 Jan-16
Apr-16
Jul-16
Oct-16
Jan-17
Apr-17
Jul-17
Oct-17
Jan-18
Apr-18
Jul-18
Oct-18
Jan-19
40
Source: IHS Markit PMI indicators.
Chart 2: Investment goods production has slowed sharply in the euro area and Japan Y-o-y % changes, 3-month moving average
10
Euro area
Japan
USA
10
8
8
6
6
4
4
2
2
0
0
-2
-2
-4
-4
-6
-6
-8 -8 Jan-2016 Apr-2016 Jul-2016 Oct-2016 Jan-2017 Apr-2017 Jul-2017 Oct-2017 Jan-2018 Apr-2018 Jul-2018 Oct-2018 Jan-2019 Source: OECD (2019), OECD Main Economic Indicators (database).
1
Chart 3: Business confidence is deteriorating, especially in manufacturing Balances, % (seasonally-adjusted)
A. Manufacturing
20
Euro area
EU28
10
10
0
0
-10
Long-term average, euro area
-10
-20
Long-term average, euro area
-30 -40
B. Services
20
-20 Euro area
EU28
-30
2007
2009
2011
2013
2015
2017
2019
-40
2007
2009
2011
2013
2015
2017
2019
Source: European Commission (2019), Business and Consumer Surveys.
Chart 4: The euro area’s labour market is robust % of labour force 13
Unemployment rate (lhs)
Wagesš (rhs)
Y-o-y % changes 4.0
12
3.5
11
3.0
10
2.5
9
2.0
8
1.5
7
1.0
6
0.5
5
2007 2008 2009 2010 2011 2012 2013 2015 2016 2017 2014 1. Nominal wages per employee. Source: OECD (2019), OECD Economic Outlook: Statistics and Projections (database, provisional).
2
2018
0.0
Chart 5: Export volumes declined in the euro area Y-o-y % changes, 3-month moving averageยน
7
Intra-EA
7
Extra-EA
6
6
5
5
4
4
3
3
2
2
1
1
0
0
-1
-1
-2 2016M03 2016M06 2016M09 2016M12 2017M03 2017M06 2017M09 2017M12 2018M03 2018M06 2018M09 2018M12
-2
1. Goods, seasonally and working-day adjusted volume indices. Source: Eurostat.
Chart 6: Export orders declined sharply in Germany PMI index, new export orders in the manufacturing sector
65
65
60
60
55
55
50
50
45
45 Germany
France
Italy
Spain
40
40
35 Jan-16
Apr-16
Jul-16
Oct-16
Jan-17
Apr-17
Jul-17
Source: IHS Markit PMI indicators.
3
Oct-17
Jan-18
Apr-18
Jul-18
Oct-18
Jan-19
35
Table 1: Recent growth performance Annualised quarterly real GDP growth, % 2018 Q1
Q2
Q3
Q4
European Union
1.7
1.9
1.3
1.2
Euro area
1.5
1.7
0.5
0.9
Germany
1.5
1.8
-0.8
0.1
France
0.9
0.7
1.1
1.3
Italy
0.8
0.2
-0.6
-0.4
Spain
2.5
2.4
2.2
2.2
United Kingdom
0.2
1.6
2.8
0.9
Source: OECD (2019), OECD Economic Outlook: Statistics and Projections (database, provisional).
Table 2: OECD Interim Economic Outlook forecasts, March 2019
4
Chart 7: Investment remains weak in the euro area Index, 2007Q4=100
110
110 Private investment
Public investment
100
100
90
90
80
80
70
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
70
1. Volume, deflated by the GDP deflator; private investment is obtained as gross fixed capital formation of the total economy minus public investment (government fixed capital formation, in the appropriation account). Source: OECD (2019), OECD Economic Outlook: Statistics and Projections (database, provisional).
Chart 8: In the euro area, potential growth has not fully recovered from the crisis Y-o-y % changes
2.0
2.0
1.5
1.5
1.0
1.0
0.5
0.5
0.0
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
0.0
Source: OECD (2019), OECD Economic Outlook: Statistics and Projections (database, provisional).
Chart 9: The impact of co-ordinated policy support on euro area’s GDP Differences from baseline
0.9
Structural only
0.8
Fiscal
0.9
Combined
0.8
0.7
0.7
0.6
0.6
0.5
0.5
0.4
0.4
0.3
0.3
0.2
0.2
0.1
0.1
0
2019
2020
2021
Source: OECD calculations using NIGEM.
5
2022
long-run
0
6