Filtered by Region: Europe Use setting Europe
Retail sales fall before new restrictions introduced September’s data show that euro-zone retail sales were coming off the boil even before many non-essential retailers were forced to shut up shop. Online spending will probably pick up again, but by …
5th November 2020
The new lockdowns in Germany and France, as well as the stricter virus containment measures in other countries, are likely to cause low inflation in the region to become even more entrenched. The lockdowns being implemented across the euro-zone are …
4th November 2020
A bleak winter ahead The final Composite PMIs suggest that economic activity in the euro-zone flat-lined in October. But with countries throughout the region entering new lockdowns or substantially tightening restrictions in November, the euro-zone …
We now expect euro-zone GDP to contract by 3% q/q in Q4 and to be unchanged in Q1 2021, based on the latest lockdown measures staying in place for three months. A return to the stricter measures of the first wave, which is a quite plausible, would result …
3rd November 2020
Time running out on Swiss recovery Data published on Friday showed a smaller-than-expected fall in the Swiss KOF Economic Barometer in October, from a downwardly-revised 110.1 in September to 106.6. This left it above its February level and suggests that …
30th October 2020
Record growth is of no comfort The massive increase in GDP in Q3 is of no comfort to French policymakers or households, who are now contending with a second national lockdown. Indeed, we expect GDP to fall by 2.5% q/q or so in Q4. The 18.2% q/q increase …
European investment activity is likely to remain subdued into 2021, as pricing has been slow to adjust and investors continue to push back investment decisions in the current uncertain environment. CBRE data showed that there were no signs of a recovery …
29th October 2020
We think the one-month national “lockdowns” will result in GDP contracting by around 2.5% q/q in France in Q4 while in Germany GDP will be flat at best. There is obviously a big risk that the lockdowns stay in place for much longer than a month, are …
Nordics not immune, but comparatively resilient In case you missed it, we released our latest Nordic & Swiss Economics Outlook this week. Of course, virus developments are the key uncertainty. However, assuming that the Nordics continue to avoid the scale …
23rd October 2020
Having outperformed in H1, the Nordic economies are set for some of the smallest falls in output in Europe this year. Of course, the virus is the key uncertainty for the outlook, but it is encouraging that Denmark’s second wave already looks to have …
20th October 2020
Overview – The second wave of coronavirus has caused the recovery to stall and we forecast euro-zone GDP to stagnate for the next six months, with an outright recession a significant downside risk. We think Spain’s economy will probably contract in Q4, …
19th October 2020
Switzerland in the grip of a second wave The share of virus tests returning positive results in Switzerland doubled in the first two weeks of October and mirrored similar rises seen in Italy and the UK over the same period. At about 7%, the positivity …
16th October 2020
Even though lockdown restrictions had eased, office take-up in Paris in Q3 was still well below pre-virus levels. And the recent imposition of tighter restrictions in Paris will likely curtail leasing activity in Q4. With similar strict measures likely in …
Government action has meant corporate bankruptcies have remained low, which has prevented a sharp rise in tenancy defaults and has supported income security on leases. But, as this support is gradually withdrawn, rising tenancy defaults in a weak occupier …
15th October 2020
With the virus spreading rapidly, governments are ramping up their containment measures. The new restrictions will be more targeted, regional and time-specific than in the first wave, but they are still likely to cause a new contraction in the services …
14th October 2020
The slowdown in the pace of monthly GDP growth in Norway in August was driven in large part by a fall in consumer spending. The post-lockdown spending splurge on goods appears to have peaked before spending on services was strong enough to pick up the …
13th October 2020
Strong retail sales the outlier, not the norm On the face of it, normality appears to have returned to at least one part of the euro-zone economy. Data this week showed a strong rise in retail sales volumes in August, to 3% above their pre-virus level. …
9th October 2020
Who’s afraid of the Big, Bad US Treasury? Thomas Jordan banged a familiar drum in a speech this week, yet again justifying the SNB’s FX interventions that have seen its balance sheet balloon over the past decade. He also stressed that the Bank’s must have …
The recent strength of retail sales data overstates demand on European prime high streets, with spending by tourists still absent and online purchases making an above-average contribution in most markets. That said, online spending growth has been …
Retail has been hit hard by the COVID-19 crisis and lasting changes to online spending will bring further pain. While our estimates suggest that the impact is likely to be less severe than structural change in offices, the rental outlook is expected to …
8th October 2020
Brighter outlook for the NOK next year Having fallen to four-month lows against the euro in late-September, the Norwegian krone and Swedish krona bounced back this week. While the NOK is vulnerable to falling further in the near term, we think that a …
2nd October 2020
While we continue to think that this year’s property downturn will be milder than in past cycles, next year’s recovery is looking more fragile. This in part reflects revisions to our economic view, but also structural changes which are weighing on the …
1st October 2020
Despite the sharp drop in GDP, the relatively small fall in world trade has meant that industrial rents in port cities held up better than expected during H1. And we think that the ongoing recovery in global trade will prevent rents from falling this …
Rising order backlogs to sustain industrial rebounds While Swiss inflation has risen since reaching a trough in June, it is likely to stay very weak in the near term. Meanwhile, the positive set of September manufacturing PMIs from Switzerland and Sweden …
Recent moves in real estate equity prices suggest that there is upside risk to our forecasts for industrial property values this year. However, even the industrial sector will not be immune if rising virus cases lead to widespread lockdowns. Earlier in …
30th September 2020
Overview – Investment activity and rents have felt the impact of the virus, with the retail sector bearing the brunt. Indeed, after falling by around 2% this year, we think that Scandinavian retail rents will end 2020 4% lower than in 2019. And with …
28th September 2020
The Swiss head to the polls After a virus-imposed hiatus, the Swiss are set to resume doing what they love best this Sunday: voting. Five separate referenda will be held, covering a range of topics including whether the government should buy some new …
25th September 2020
Risk of W-shaped recovery rising This week brought evidence that the economic recovery is grinding to a halt and that activity in the services sector is falling. And with the stringency of virus containment measures only going in one direction, there is a …
The fact that policymakers at the SNB and the Norges Bank left policy settings unchanged this morning came as no surprise. Both banks are likely to leave policy unchanged throughout our forecast horizon and, in the case of the SNB, probably until at least …
24th September 2020
A key assumption in our forecasts has been that there will not be a repeat of the spring’s strict nationwide lockdowns that would cause the recovery in economic activity to go into reverse. That assumption is looking a bit shakier in light of headlines …
18th September 2020
Overview – As widely expected, Q2 brought a range of disappointing data, from plunging investment volumes to further falls in retail rents. And while property values outside of retail have generally held up so far, fragile occupier demand and rising …
In contrast to the US where falling inventories may start to push up prices, euro-zone firms’ inventories suggest that near-term price pressures are weak. Euro-zone retail sales have recovered much more quickly than industrial production since lockdowns …
16th September 2020
As we have argued in our Global Property Focus , we think that some of the increase in remote working seen this year will become a permanent feature of working practices in office-based sectors in the coming years. In Europe, we estimate that this will …
14th September 2020
Given Norway’s decision to re-open its economy comparatively early, its post-lockdown experience has been watched closely for clues as to how other economies could expect to fare. The latest monthly data showed that mainland GDP continued to expand in …
11th September 2020
Sweden’s virus approach may be bearing fruit Interpreting Covid data is of course part science, part art, but the fact that confirmed virus cases per capita in Sweden fell below those in its Nordic peers in early-September appears to vindicate Sweden’s …
Norwegian inflation pressures set to ease before long Signs of rising domestic price pressures in Norway raise the chance of a hawkish shift by the Norges Bank at the next meeting. However, with imported price inflation set to peak soon, and services …
10th September 2020
The falls recorded so far, most notably in the CEE region, coupled with our view that the initial recovery in retail sales in Europe has started to run out of steam, has prompted us to downgrade our prime retail rental forecasts for the euro-zone and CEE. …
Even after the immediate threat of COVID has receded, we expect as many as 50% of office-based employees will work from home at least once a week. But the move away from cities and toward the suburbs should prove short-lived. Most of those leaving cities …
9th September 2020
Industrial rebound slowing German industry eked out a meagre increase in production in July, leaving output still well below its pre-crisis level. Production is likely to have increased again in August, but we now seem to be past the period of rapid …
7th September 2020
Riksbank still biding its time Policymakers at the Riksbank won’t admit it, but they will be feeling pretty comfortable with their position, all things considered. After all, the further increase in the services PMI in August suggests that activity in the …
4th September 2020
The reversal in equity dividend yields following the virus-related market rout in March lead to a broad-based improvement in property valuations. (See Chart 1.) Coupled with central banks’ assurances that policy will remain accommodative for some time to …
3rd September 2020
Signs of rising manufacturing backlogs bode well for the near term The positive set of August manufacturing PMIs from Switzerland and the Nordics suggests that the recovery in industrial activity continued over the summer. While the fortunes of industry …
1st September 2020
Euro-zone governments have been understandably keen to avoid repeating the blanket lockdowns of earlier this year in response to the resurgence in coronavirus cases over the past month or so. Low hospitalisation rates have allowed policymakers to focus on …
28th August 2020
Nordics top of the league in H1… The Nordic economies emerged at the top of the economic league in Europe in H1, with comparatively small declines in output. (See here .) The second reading of Swedish Q2 GDP, released this morning, shows that the …
Broad money growth accelerated to a 12-year high in July, but we think that this will prove to be temporary and is not likely to push up inflation. Meanwhile, growth in bank lending to firms has returned to more normal levels, while consumer credit …
27th August 2020
While Sweden’s economy got off relatively lightly in H1 thanks to the light-touch lockdown, Norway and Finland saw even smaller falls in activity at a lower human cost. Nonetheless, the success of the Nordics does not offer any obvious lessons for those …
26th August 2020
France’s virus-related slump in the first half of 2020 rivalled the big falls in GDP in Italy and Spain. But its recovery should be stronger because working from home is more common, the economy is less dependent on international tourism, and the …
24th August 2020
Q2 data was a mixed bag as all markets recorded shifts in yields while only a handful of markets saw moves in rents. That said, Scandinavian investment activity took a significant hit in Q2, and despite the pick-up in June and July, transactions look set …
“Two-speed” Swiss industry finds reverse gear The belated release of Q2 industrial production data from Switzerland on Thursday laid bare the stark divergence in fortunes within the sector. Total manufacturing output dropped by 8.3% q/q in Q2, which was …
21st August 2020
Investment and occupier demand plunged further in Q2. As expected, the retail sector bore the brunt of the impact, with capital values falling by almost 9% y/y. This drove down all-property capital value growth to just 3% y/y, the lowest since 2012 Q4. …
19th August 2020
