What's going on?

Data on the eurozone�s economic growth in the last quarter of 2018 was released on Thursday � and it wasn�t too bad. Unless you�re Italian, that is…

What does this mean?

The euro-spending economy grew by 0.2% in the fourth quarter compared to the third � 1.2% up on the same time a year ago. That�s exactly what economists had predicted, having analyzed swaths of data in January showing that any hope of a growth improvement was a long shot.


Still, at least the eurozone did grow overall. The Italian economy shrank for the second quarter in a row compared to the previous one, according to data out on Thursday � meaning the country�s now in a dreaded recession. Struggling industries like fishing and forestry shouldered the blame � increasing the risk that the country fails to repay its positively Apennine debts.

Why should I care?

The bigger picture: Europeans drowning their sorrows.

Consumer goods giant Unilever reported fourth-quarter sales that missed investors� forecasts on Thursday. That was thanks to �developed markets�: European sales were only 1% higher than last year, while American sales didn�t grow at all. Europe�s meager growth might be explained by falling consumer confidence leading shoppers to rein in spending on big-name brands (especially as Unilever raises their prices). Instead, they drink: British spirit maker Diageo�s results for the last six months were better than expected, helped by surprisingly strong European sales.

For markets: Investors skirted the issue.

Investors� Thursday focus seemed to be on the US Federal Reserve�s comments late on Wednesday. The Fed said it could be patient with future interest rate increases � and flexible about the speed at which it removes other market props in place for a decade. In spite of Europe�s weak economy, investors bought up stocks globally, since lower-for-longer rates should help companies grow more quickly. That helped give world stocks their best month since March 2016, and US stocks their best January since 1987.