Let’s start with a trip down memory lane: Do you remember the scenery 30 years ago – on the financial markets, and in our personal lives? The 1980s – many of the older generation are still thinking back to the “good old times”. There were no smartphones and no data kraken. Instead, we had shoulder […]
The heightened uncertainty over whether Italy will repay its debts and whether it will remain a member of the eurozone has led to a sell-off in securities. Our chief economist Gerhard Winzer gives an overview.
Positive opportunities still outnumber the negative ones on the capital markets – that was the conclusion of our Investment Committee. Our willingness to take risks is still optimistic and also moderately higher than in April.
European banks (as measured by the Stoxx 600 Banks Index) had a decent year in 2017: the index climbed more than 8%, slightly outperforming the broader European market (Stoxx 600 Index). The strongest positive impulse came from the French elections in April last year, where the populist threat was successfully defeated by Emmanuel Macron, arguably the most market-friendly candidate among the contenders. A robust European economy and a solid business sentiment throughout the year also helped banking shares go higher.
The Council of the European Central Bank pulled an impressive stunt at the monetary policy meeting on 26 October. ECB President Mario Draghi announced to reduce the extremely supportive monetary policy in the near future while …
Economic growth in the Eurozone has embarked on a clear upward trend. At the same time, the fear of falling wages and prices has disappeared for now. The worries over a possible break-up of the European Union have also eased. Against this backdrop, the ECB President Draghi issued a slightly more optimistic growth forecast yet again on 27 April at the press conference of the European Central Bank. This is another tiny step indicating a possible reduction of the monetary support in the medium term.
The first weeks of the new year have already picked up from where the trends that started in 2016 and the hypotheses for 2017 left off: higher growth, normalisation of inflation, increased uncertainty with regard to the effects of Trumponomics, and a gradual end of the loose monetary policy.
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.
Author: Martina Groll, Senior Fund Manager The bond purchase programme of the European Central Bank has caused a drought on the bond markets. As a result, investors now have to take into account the liquidity risk on top of the interest rate risk and the default risk.
The Council of the European Central Bank (ECB) further loosened its monetary policy on 10 March 2016. In view of the decline of the leading economic indicators and the excessively low inflation in the Eurozone, the bundle of measures introduced by the ECB is necessary. But, to paraphrase Mohamed El-Erian, the expansive central bank policy […]