UNCERTAINTY ABOUNDS ON THE WORLD STAGE.
European businesses are on high alert as economic data generally deteriorates and uncertainty related to the US-China trade war, looming Brexit, and political changes in Italy accumulates. The automotive industry is struggling; annual Exports of Road Vehicles are down 3.7% from one year ago. Automotive producers face stricter carbon emission rules ahead, which could further hinder this critical industry. Annual average Europe Industrial Production has generally trended lower since an October 2018 peak and recently passed a new milestone, dipping 0.1% below the year-ago level. This signifies a transition to the next phase of the business cycle: Phase D, Recession. The European Central Bank is expected to respond with a stimulus package, but its economic arsenal is limited due to already low interest rates.