Erste Asset Management - Blog

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Gerold Permoser am 26th November 2015

EAM discloses CO2 footprint of its equity funds

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Erste Asset Management discloses the CO2 footprint of its equity funds for the first time. The CO2-intensity of all EAM equity mutual funds is at 70.6% as compared to the MSCI world index. Our three responsible equity flagship funds are even below 50% of the referential value.

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Gerold Permoser am 18th November 2015

The US dollar is lead currency

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A young father is always pressed for time. What he needs is in particular is a good strategy. One of my strategies in selecting reading material is to just wait. Time will tell what is interesting and what is not. Which is why last week I read a book that had come out in 2011: Exorbitant Privilege: The Rise and Fall of the Dollar, by Barry Eichengreen, ( an acclaimed) professor of economic history.

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Peter Szopo am 13th November 2015

Interest rate lift-off – Stay cool

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Following last week’s surprisingly strong employment report, the odds that the US Federal Bank will start raising its policy rate at the next FOMC-meeting in December jumped to almost 70%. Of course, 70% is still short of 100%, but most observers believe that something terrible must happen in the next four weeks to make the Fed reconsider, particularly in light of President Yellen’s statement in September that the FOMC’s thinking suggests a “call for a funds rate increase later this year”.

While the case for starting the lift-off remains a close call as Kenneth Rogoff pointed out, it has strengthened in recent weeks as US economic data have turned more positive relative to expectations, according to Citi’s economic surprise index. Most importantly, the improvement in the job market is continuing. The US economy has been adding, on average, 200,000 jobs in the non-farm sector each month in 2015.Read more

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Sevda Sarp am 02nd November 2015

Turkish Elections Update

With the current outcome, the uncertainties in Turkish economies are off the table. AKP (governing party Justice and Development) will now have 316 seats in the parliament. This is enough to form a single party government, still, it falls short of constitutional majority – the most market friendly outcome. There will be a positive sentiment as Turkey goes back to business. After a period of deepened political uncertainties, the election outcome leads to some relief on Turkish capital markets.

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Gerhard Winzer am 02nd November 2015

Janet Yellen: Inflation Fighter

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The US central bank Fed hinted at an increase of the Fed funds rate in December at its meeting on 28 October. A bias towards such an increase is referred to as tightening bias.

If the economic data permit it, the Fed will increase the Fed funds rate from practically zero percent. The extent and the speed of the increases will remain low. On a global scale, we can see deflation pressure (pressure for prices and wages to fall). The strong US dollar already has a negative impact on the US economy, the financial markets are still unstable, and the so-called natural interest rate, which comes with full employment and stable and low inflation, has fallen clearly in the past years. The outlook for the risky segments of the financial market remains positive in the short run, but uncertain in the medium term.

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