Peter Praet Member of the Executive Board of the ECB The ECB asset purchase programme and European financial markets TSI Congress Berlin 28 September 217
Global and EA PMI composite output (diffusion index; SA; monthly data) Global PMI Composite Global: 1999-217 average Global PMI ex. EA Composite EA PMI Composite 6 6 55 55 5 5 45 45 4 4 35 27 29 211 213 215 217 35 27 29 211 213 215 217 Sources: Markit, ECB staff calculations. Latest observation: August 217. Source: Markit. Latest observation: August 217. 217-9-28 2
Industry.7.6.5.4.3.2.1-44 -39-35 -3-26 -21-17 -12-8 -3 1 6 1 Retail.6.5.4.3.2.1. -3-27 -23-2 -17-13 -1-7 -3 4 7 1.4.3.2.1 Construction Business and consumer sentiment (relative frequency) Households.7.6.5.4.3.2.1. -41-37 -34-3 -26-22 -18-15 -11-7 -3 4 Services.5.4.3.2.1. -35-29 -24-18 -12-7 -1 4 1 16 21 27 32. -46-42 -37-32 -27-22 -17-12 -7-3 2 7 12 Source: European Commission. Note: Historical distribution of balances of opinion for five different sectors. Sample: January 2- August 217. Latest observation: August 217. 217-9-28 3
M3 and loan growth (annual percentage changes) Central bank balance sheets (Jan. 27 = 1) 14 M3 loans to the private sector 6 Eurosystem Federal Reserve 12 1 5 8 4 6 4 3 2 2-2 1-4 27 29 211 213 215 217 27 29 211 213 215 217 Source: ECB. Latest observation: August 217. Sources: ECB and Federal Reserve. Latest observation: 22 September 217. 217-9-28 4
Bank loans to the private sector (annual percentage changes) DE ES EA 3 25 2 15 1 5-5 -1 23 25 27 29 211 213 215 217 Source: ECB. Latest observation: August 217. 217-9-28 5
HICP inflation and HICP excluding food and energy (annual percentage changes) Risk neutral probability density function of euro area inflation over the next five years HICP HICP excluding food and energy 4.5 4. 3.5 3. 2.5 2. 1. 1.2.5. -.5-1. 1999 21 23 25 27 29 211 213 215 217 APP Announcement (21 Jan 15) Latest observation (22 Sep 17) -3. -2.5-2. - -1. -.5..5 1. 2. 2.5 3. Source: Eurostat. Latest observation: August 217. 217-9-28 6 Sources: Bloomberg, Reuters, and ECB calculations. Note: Density functions are computed from 5-year maturity zero-coupon inflation option floors under the assumption of risk neutrality. These risk neutral density functions may differ significantly from physical (or "true") probability distributions. Shaded areas indicate the probability mass assigned to an inflation rate below.% over the next 5 years. Latest observation: 22 September 217.
Measures of underlying inflation (annual percentage changes) Components of HICP excluding food and energy (annual percentage changes, percentage point contributions) 3. HICP excluding food and energy HICP excluding food, energy, travel-related items and clothing Long-term average HICP excluding food and energy U2 Core Super-core 2. Clothing Travel Services excluding travel NEIG excluding clothing HICP excluding energy and food 2.5 2. 1. 1..5.5.. 21 211 212 213 214 215 216 217 Sources: Eurostat and ECB calculations. Note: The dynamic factor model (U2 Core) is based on the full 93 HICP items from each of 12 countries. Super-core is based only on those items in HICP excluding food and energy that are sensitive to slack as measured by the output gap. The range includes exclusion-based measures, trimmed means and a weighted median. Latest observation: August 217. 217-9-28 7 -.5 21 211 212 213 214 215 216 217 Sources: Eurostat and ECB calculations. Latest observations: August 217.
Inflation in Services and Compensation per Employee in Services (annual percentage change) Wage Phillips curve (x-axis: percentage points; y-axis: annual percentage changes) 26 Q1-28 Q1 28 Q2-214 Q3 4. HICP services Compensation per employee 4. 214 Q4-217 Q1 217 Q2-219 Q3 Simple fitted Phillips curve 3.5 3.5 3. 2.5 2. 1..5 Compensation per employee 3. 2.5 2. 1..5. 27 29 211 213 215 217 Sources: Eurostat and ECB calculations. Note: The latest observations are 217 Q3 (latest data point refers to August 217) for HICP services, and 217Q2 for compensation per employee. 217-9-28 8. 14 15 16 17 18 19 2 21 Broad unemployment rate Sources: Eurostat and ECB calculations. Note: Broad unemployment rate includes (i) total unemployed, (ii) underemployed part-time workers who currently have jobs, although not at the optimal weekly hours they would like, and (iii) inactive persons who are marginally attached to the labour market, as a percent of the labour force plus all marginally attached workers. The difference between the unemployment rate and the broad unemployment rate is assumed to decline at the same pace as observed in the past 6 quarters. The black line represents a simple fitted Phillips curve. Latest observation: 217Q1.
Implied unemployment gaps (percentage points) Unemployment rate Broad unemployment rate 2 1-1 -2-3 -4-5 -6 26 28 21 212 214 216 Sources: Eurostat (EU LFS). Note: Seasonally adjusted data. Broad unemployment rate includes (i) total unemployed, (ii) underemployed part-time workers who currently have jobs, although not at the optimal weekly hours they would like, and (iii) inactive persons who are marginally attached to the labour market, as a percent of the labour force plus all marginally attached workers. To obtain the implied unemployment gaps both unemployment rates are expressed as differences to their 26 average plus the 26 unemployment gap from the June 217 BMPE. Latest observation: 217Q2 for unemployment and 217Q1 for broad unemployment. 9 217-9-28
Evolution of OIS forward curves (percentages per annum) Key financial indicators since June 214 and impact of policy measures (basis points and index points) 5 1 Aug 7 1 Apr 1 3 May 14 26 Sep 17 5 Policy measures: credit easing, APP, and DFR Change 25 Sep 217-4 Jun 214 25 4 4 2-5 -5 3 3 15 2 2-1 -1 1 1 1-15 -15 5-1 1 2 3 4 5 6 7 8 9 1 Forward start in years -1-2 EA 1y yield OIS 1y yield OIS 1y yield NFC bond yield Bank bond yield -2-5 Euro Stoxx Source: ECB. Latest observation: 26 September 217. Sources: Bloomberg, ECB, ECB calculations. Latest observation: 25 September 217. 217-9-28 1