Important Information for Visitors

Privacy Policy    Disclaimer   Contact Us

Home

© Copyright 2016 Topdown Charts Limited

ChartBrief #13 European Misery Index

September 30, 2016

The latest Eurozone unemployment and inflation data were just released with the unemployment rate still stuck at 10.1% and headline inflation creeping up to 0.4% y/y (0.2% previous, and core inflation at 0.8%).  Whenever I see the unemployment rate and inflation rate in close proximity I think of the "Misery Index" - the sum of the two, so what better opportunity than to put a graph up of the European Misery Index!

The chart shows the misery index for the Eurozone  (unemployment rate + core CPI inflation rate) -- inverted (so higher misery is in the lower part of the graph).  Reason I invert it is because I also have the Eurozone consumer confidence index on there and strangely enough the consumer confidence index tends to correlate pretty well with the misery index.  This makes sense, a falling unemployment rate and relatively contained inflation makes life easier for consumers, whereas high unemployment and/or high inflation makes life tough and so consumer confidence should be lower in that environment.  In order for the misery index to continue to head higher inflation needs to actually not go higher, as the ECB would like, and the unemployment rate would need to continue down (seems to have stalled recently)... Neither seem likely to move much in the near term, so consumer confidence is also likely to be range bound around current levels.

 

Bottom line: The Eurozone Misery Index has improved to around its long term average, but further improvement may be hard to come by.

 

 

Please reload

Follow us for updates:
  • Twitter Social Icon
  • LinkedIn Social Icon
Subscribe:

Top 5 Charts Of The Week

Institutional Reports

-Weekly Macro Themes

-Global Cross Asset Monitor

-Monthly Chartbook

access our exclusive research for deeper insights:

 

>>  Become a Client  <<

Search By Tags
Archive
Please reload

Important Notice

We offer exclusive insights for institutional clients with our suite of multi-asset investment research reports, personalized service, & global perspective.

Take a trial today...

Become a Client