Central Banks startet to reduce their expansive monetary stance. The confidence to achieve the inflation goals improved, given the strong economic growth data. In the US the start of the tapering program is expected in autumn, the probability for a further increase in the Fed funds rate in December was lately at 40%. The ECB will start the discussion regarding a possible tapering also in autumn.
The IFO business climate index calculated by the Munich-based IFO Institute is regarded as the most important German economic indicator. At 115.1, the value released for June last week was the highest since the launch in January 1991. It was also clearly above the value that had been expected by the financial analysts on average. The signs for substantial economic growth in Germany seem favourable.
Author: Christin Bahr, Product Management Securities Erste Group
It has been half a year since the launch of the new hybrid bond fund. Reason enough for us to talk to Roman Swaton, Senior Fundmanager.
The global economy is growing moderately, inflation is low, and the monetary policy is loose. This environment supports many asset classes from bonds to equities. The political uncertainty has been absorbed rather well so far too. Will this situation last?
Investing for the long or the short term? This is the question bond investors ask. In this blog, we will have a look at German government bonds with a remaining time to maturity of two years (2Y; short) and ten years (10Y; long). More specifically, we are interested in the yield differential between the long- and the short-term interest rates. The technical term here is the “slope of the yield curve”.
USA, the land of unlimited possibilities, the Grand Canyon, and the Big Mac. Here, everything is bigger, better, and higher. But is this also true for interest rates?
Have you ever been to the Monte Carlo F! Grand Prix? If so, you may have witnessed the problem of turning into a curve too late. The race car hits the crasher barrier faster than the driver can react, and a lot of money has to be thrown at the repair job.
Author: Stephanie Clam Martinic
Senior Fund Manager Multi Asset Management
In 2016, election results surprised us twice: both the Yes vote for Brexit and Donald Trump’s victory in the USA were unexpected, but did happen. This prompts the question of whether the European Union (EU) is in peril because of the French elections in April.
Will Marine Le Pen win the presidential election in France and then lead the country – one of the original founders of the European Union – out of said union?
In our annual press conference I have presented the most relevant topics for the investment year 2017. The most relevant ones are: stronger expected global growth, an increase in inflation and elevated event risks due to political reasons.
Economic growth in the emerging markets has picked up substantially, while that in the industrialised economies has been rather stable. This has led to an increase in the growth differential in the emerging markets’ favour. Investor demand for emerging markets bonds has been on the rise in search of higher yields and interest rates.