Our compact monthly update on developments in the real economy and on financial markets.

Justified hopes (2020/5/27)

Now that the economy has bottomed, political policy-makers are seeking to spur the recovery. The Reconstruction Fund can make a contribution here, opening a new chapter in the mutualisation story.

Clear & concise

  • The economic will turn out to have touched bottom in the second quarter.
  • Despite the clear rebound, pre-crisis levels will not be hit in many places until 2023.
  • EU Reconstruction Fund is likely to be a (temporary) step towards a transfer union.
  • The ECB will further expand its purchase programmes in spite of the FCC’s verdict.
  • Asset-allocation wise, we are upgrading periphery bonds from underweight to neutral.

Read more Justified hopes (Perspectives edition 06/2020)

The coronavirus pandemic has triggered a deep (albeit temporary) recession (5-year forecast, 2020/3/19)

The coronavirus outbreak has triggered a deep global recession. Once the pandemic has been contained, we forecast a rapid recovery, followed by years of moderate growth. Yields are set to remain low.

Clear & concise

  • The 2020 global recession will be deeper than the one caused by the financial crisis;
  • Monetary and fiscal loosening will only take effect after the virus has been contained;
  • The economy, along with higher-risk asset prices, will recover from H2 2020 onwards.
  • A further surge in indebtedness implies persistently loose monetary policy worldwide;
  • Sustainability & digitalisation will play an even bigger role for the economy & markets.

Read more The coronavirus pandemic has triggered a deep (albeit temporary) recession (edition 03/2020)