Fading inflation pressures should boost real household incomes in the months ahead, helping support a stronger-than-anticipated rebound in consumer demand within key European markets. Industrial production levels might eke out a modest improvement if Chinese stimulus spending begins flowing in earnest and global inventory cycles normalize. And as rate expectations fall, financial conditions in the euro area are easing almost as quickly as in the United States. We think this could translate into a snapback in credit demand across the economy.
Bloomberg financial conditions indices