Real GDP growth forecast for 1Q14 lowered to 2.0% on incoming January data; forecast for 2Q14 still 2.5%. Most evidence suggests that the downside surprises in the data are not predominantly weather effects. CPI and core CPI up 0.1% in January; CPI and PPI detail suggest core PCE will be 0.05% and only 1.0%oya.
PMI expected to increase 0.4pt to 52.5 next week. Euro area IP rebounded in November. We nudge down our 4Q13 GDP estimate in Germany and nudge it up in France. French president Hollande announces plans for structural reforms.