...And this has worked: euro area exports have gained significant market share this year.

In particular, the weaker euro has allowed a shift in exports away from EM towards DM.

Latest European Commission surveys show very strong euro area investment plans for 2016.

Currency wars everywhere, euro and underwhelming excess reserves edition on.ft.com/1NnBXAo

The big news in the UK GDP data release was the large downwards revision to nominal growth.

UK NGDP growth now at its slowest since the great recession, driven by sharp slowdown in corporate earnings.

Since 2003 Germany’s cumulative current account surplus=€1.8tn but its NIIP has only risen €1.4tn cc Adam Tooze

We’re having a mini relaunch of CS European Economics Twitter. So expect more regular tweets. Starting with the UK…

…Another way of showing the fall in the saving ratio is the gap between income and consumption growth. Something’s got to give.

Draghi's speech last week suggests the pace of QE to keep policy stance "broadly unchanged" will depend on growth - we think PMIs important

Our decision tree analysis finds PMI manf. new orders above 56.2 has indicated hawkish ECB in past. Yesterday it hit a new 6y high of 58.7

That said, composite PMI looks to have fallen below its hawkish threshold in June. But should be enough growth ammo to keep ECB eyes on exit

The decision tree that we found best describes ECB policy looks like this. QE enlargements are classified as a cut. Taper will be a hike.

The upward revision this morning takes composite PMI back above the 56.1 threshold that has historically indicated a hawkish ECB.

It's worth noting that composite PMI has been spot on in showing last 4 qs’ GDP growth. It indicates an acceleration to 0.7-0.8%q/q in Q2.

We don’t think the end of QE will be a trigger for unsustainable fiscal dynamics in any euro area country. For three reasons.

1) ESCB to continue to own a sizable portion of government debt, that portion is effectively financed at the negative depo rate…

…by the end of QE we estimate 0.3-0.5% GDP boost to primary balance in the periphery through interest payments returned to treasury by NCBs

2)QE stock effect should keep rates subdued. Alongside less “Eurexit” risk, marginal issuance rate should still support falling average rate

3)Stronger, broad based growth should be a prerequisite for tapering. That’s more important for debt dynamics than the ECB policy it elicits