Euro Zone GDP figure strengthens ECB hawks

Hawkish policymakers at European Central Bank (ECB) likely to feel extra energized from today's released GDP figures. According to latest from Eurostat,

• Euro area, headline GDP grew by 0.3% in fourth quarter, which is 1.6% more than figure of last year. This makes Euro area GDP growth comparable to that of UK, which grew 0.5% and US, which grew 0.3%.

• High level of growth were registered in relatively smaller economies. Estonia grew +1.3%, Slovakia grew 1%. Contraction of -0.3% was registered in Latvia.

• Gross fixed capital formation has been key driver of growth, which rose by 1.3%. Compared to that household consumption expenditure rose by +0.2% only. Greater increase in imports by +0.7%, over exports has been a drag.

• Among the big four, Sapin grew by +0.8%, Germany and France grew by +0.3% and Italy grew by mere 0.1% in fourth quarter.

With market volatility stabilizing, oil and industrial commodity prices rising, inflation expectations rising, hawks have now another argument, stable growth to argue against further monetary stimulus.

Euro is currently trading at 1.101 against Dollar.