Domestic consumption likely to lead euro area Q4 GDP

The CPI index in euro area posted a marginal improvement in November as it stood at 0.2% year on year. Similarly, the Markit manufacturing PMI index also increased to 51.6 for December.

Though there is a modest recovery in the economic activity is observed in last week, but they are unlikely to accelerate further. Weaker net exports and lower service inflation figure are likely to weaker the economic momentum of the euro area.

Cheap oil prices, low interest rates, and improvement in private consumption are supporting the economic growth. The economy being driven by domestic consumption is expected to grow at 0.3% q/q in Q4 2015, estimates Barclays.