Don't give up in to defeatism

• Greek elections
• Inflation in negative territory
• ECB ready to act

While the US economy has accelerated before the end of the year, the eurozone did not get off to a good start in 2015. The financial markets are mainly preoccupied by Greece and the prospect of early elections there at the end of January. If the polls are to be believed, Syriza could win these elections and lead the next coalition government. This is a party that is seeking the end of austerity measures and a fresh restructuring of Greek public debt. However, as we stress, the economic interests of both Greece and its creditors argue for compromise. Mediocre economic figures do little to deflect attention from political uncertainties. Industrial production fell in November 2014 in several of the eurozone's major economies, not just France, due to lower energy production. In addition, confidence surveys published this week (PMI, European Commission) suggested that the economy remained weak at the end of last year. Lastly, in December inflation slipped into negative territory (-0.2%) for the first time since 2009. Driven largely by the fall in energy prices, this phenomenon is, for the time being, neither widespread nor selfsustaining, two features of true deflation. But the risk is definitely there and the ECB is readying itself to act.