Week Ahead (13 February)
Monday, 13 Monday– Eurogroup to meet to discuss fiscal response to energy market developments
The Eurogroup meets today to discuss inter alia the fiscal response of member states to energy market developments. The director of the EU Agency for the Cooperation of Energy Regulators (ACER), Christian Zinglersen, will update ministers on recent energy market developments. The European benchmark price for natural gas has dropped to about €50/MWh, after reaching a historic high of €300/MWh in August, partially easing a cost-of-living crisis in Europe.
Following Russia’s invasion of Ukraine, member states introduced generous subsidy schemes to mitigate the impact of inflationary pressures and skyrocketing energy prices on consumers. Although natural gas prices are still higher than the historical average, their decline in recent months has led several member states to consider completely scrapping electricity subsidies. Other items on the Eurogroup’s agenda include recent development in the Eurozone labour market, and macroeconomic and financial developments taking into account the Commission’s winter interim economic forecast, which was published earlier today.
Tuesday, 14 February - Eurostat flash GDP and employment estimate for Q4 to be released, following the publication of the Commission’s winter economic forecast
On Tuesday, Eurostat will release its latest flash estimate of GDP and employment statistics for Q4 2022.
According to the European Commission’s winter forecast, published earlier today, the EU and the Eurozone will avoid a contraction in Q1 2023, in contrast with earlier forecasts, indicating a slight improvement in confidence. Overall, GDP in 2023 is now projected to grow by 0.8% in the EU and 0.9% in the euro area. Furthermore, the forecast slightly lowers the projections for inflation for both 2023 and 2024. In the EU, it is projected to fall from 9.2% in 2022 to 6.4% in 2023 and 2.8% in 2024. In the euro area it is projected to fall from 8.4% in 2022 to 5.6% in 2023 and 2.5% in 2024.
Tuesday, 13 February – Apple to defend its contactless payment system in EU hearing
On Tuesday, Apple’s competition executives will be in Brussels to defend the company in a hearing on EU antitrust charges against Apple Pay. It will take place nine months after the European Commission accused Apple of abusing its market position, in a statement of objections claiming that Apple’s anti-competitive practices dated back to 2015 when Apple Pay was launched.
Apple responded last year by stating that Apple Pay was only one of the several options available to European consumers and that it had ensured equal access to its Near-Field Communication technology used for contactless transactions.
The hearing will offer the company’s executives the opportunity to convince EU antitrust regulators that its payment system is not blocking rivals’ access to its contactless payments technology and avoid hefty fines.
Tuesday, 14 - Wednesday, 15 February – UK unemployment and monthly inflation figures to be published
UK unemployment and consumer price monthly inflation figures will be released this week, amid increasing fears that the UK economy is heading toward a recession in the first half of 2023.
The release will follow last Friday’s announcement that UK’s GDP is estimated to have fallen by 0.5% in December 2022, according to the Office for National Statistics (ONS), following 0.1% growth in November. The ONS’s first quarterly estimate showed that there was no growth in Q4 2022. This means that the UK has narrowly avoided entering into a recession, following a GDP contraction of 0.3% in Q3 2023.
Last month, it was announced that the consumer price index (CPI) rose by 10.5% in the 12 months to December 2022, down from 10.7% in November and 11.1% in October. Despite this downward trend, inflation is still more than five times higher than the bank’s declared target rate of 2%, fueling debate on whether the Bank of England should continue raising interest rates. Earlier this month, the BoE announced its tenth consecutive rate hike, by raising interest rates by 50 basis points to 4%.
Wednesday, 15 & Thursday, 16 February – CSO to release data on consumer prices and residential property prices in Ireland
The Central Statistics Office will release data this week showing the latest trends in consumer pricing and residential house prices in Ireland.
The Consumer Price Index data will be released on Thursday, covering the situation through January. December’s Consumer Price Index data release revealed that prices were 8.2% higher than during June 2021, with notable jumps in prices for housing, water, electricity, gas, and other fuels (up by 25.9%) and Food & Non-Alcoholic Beverages (up by 11.7%). Nevertheless, inflation dropped from its annual increase of 8.9% in the 12 months to November 2022, demonstrating a downward trend. This week’s release is expected to confirm this downward trend after CSO’s flash inflation estimate for December dropped to 7.7%.
Furthermore, Residential house price data will be released the previous day, reflecting the situation in December. Last month's release showed that prices for houses and apartments in Ireland had risen by 8.6% across the country when compared to November 2021, down from 9.7% in October and from a height of 15.1% in March 2022.
Friday, 17 February – Deadline for online platform to report the number of active end users under Digital Services Act
On Friday, the deadline for online platforms to publicly disclose the number of active end users under the Digital Services Act (DSA) expires. The DSA entered into force on 16 November. It aims to tackle disinformation and increase transparency, by empowering users to report illegal content more effectively and obliging any platform operating in the EU to remove illegal content. In other words, the DSA will force social media companies like Meta and Twitter to moderate their content more aggressively.
Depending on the reported user number, the Commission will decide on whether a platform meets the criteria to be designated as a very large online platform or search engine. Although the DSA will be fully applicable to all entities in its scope 15 months after entering into force, the largest online platforms and online search engines will have to meet their obligations earlier. More specifically, four months after their designation, online platforms with more than 45 million users will have to provide the Commission with their first annual risk assessment exercise. They will also have to step up compliance efforts to ensure that they limit the spread of illegal content and disinformation in line with the DSA’s requirements. Otherwise, they could face fines of up to 6% of their annual global turnover for breaches of DSA.