Eurozone Recovery Tracker slows down further over Christmas

Our eurozone Recovery Tracker saw further deterioration over the Christmas period, falling 1.5pts to 79.1 in the three weeks ended December 26. High-frequency data tend to be noisy around the end of the year. But the direction of travel is clear, and the indicators seem to confirm a further slowdown ahead.

What you will learn:

• There’s a growing divergence between the subcategories of the Tracker. Consumer spending and mobility have fallen sharply as the health situation deteriorates. On the other hand, however, financial conditions and the labour market remain resilient, while industry is making sustained gains.
• We expect voluntary social distancing and widespread absenteeism due to self-isolation rules to weigh on economic activity in the next few weeks as the Omicron variant surges.
• Given its high transmissibility, the wave is likely be sharp but short-lived, while the booster rollout should limit severe outcomes.