EU: No expectations of a political shock - Nomura

Analysts at Nomura offered this outlook for Europe.

Key Quotes:

• "• We see a growth of 1.8% this year (above consensus) falling to 1.5% in 2018 and 2019 as Brexit materialises. 
• • Inflation is set to rise thanks to sterling’s depreciation, though we think the spike will be short-lived. 
• • As such, the Bank of England should look through rising inflation and leave rates (and QE) on hold until H2 2019. 
• • We are relatively optimistic on the Eurozone outlook and expect further positive data surprises. 
• • On monetary policy, we expect the ECB to announce a tapering programme in H2 2017 to commence in early 2018. 
• • We do not believe a large political shock will emerge this year that would destabilise Europe’s economies."