Europe still avoids recession. Confidence at its lowest. Inflation reaches +10%. The ECB follows a more moderate strategy. Yield curves still positive. Excessive fall in European real estate. Equity risk premium of 45%.

Key points

• Can Europe repeat its relative performance in Q3 and avoid a decline in GDP?
• Still uncertain outlook for Q4
• Leading indicators still very hesitant
• Household confidence at historic low
• No sustainable respite for inflation yet
• Decline in household and business confidence
• More flexible and progressive ECB policy
• Yield curves still positive
• Securitised real estate is in turmoil
• Risk premium still high for European equities

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