Filtered by Region: Europe Use setting Europe
GDP growth in the euro-zone is likely to be only slightly stronger this year than in the second half of 2018. Hopes for a sharp rebound in export demand will probably be disappointed, meaning that the manufacturing sector will not turn the corner for a …
17th April 2019
The ECB struck a moderately dovish tone at its policy meeting this week, but with economic growth still fairly slow it will need to follow its words with actions. Meanwhile, industrial production data suggest that Italy’s recession might have come to an …
12th April 2019
The slight pick-up in Swiss inflation in March does not change our view that the headline rate will fall back into negative territory in mid-2019 and that core price pressures will remain extremely weak. … Swiss Consumer Prices …
2nd April 2019
Growing safe-haven flows in 2019 and the ECB re-starting its net asset purchases in 2020 may mean that the yields of “core” European government bonds (EGBs) fall further over the next two years. … The 10-year Bund yield may be heading to …
20th March 2019
We don’t think the increase in euro-zone industrial production in January marks a turning point for the economy, given that the business surveys for February were weak and global demand is still sluggish. Indeed, with growth and inflation likely to remain …
15th March 2019
Near zero low risk-free rates will support Western European office and industrial pricing, despite a softer rental growth outlook. In contrast, with the retail sector also dealing with structural headwinds, we think that a poorer outlook for income …
The recent poor performance of “average” retail property will persist over the next few years as investors shy away from risky cash flows. However, we also expect prime high streets to underperform the other sectors, as a handful of markets see softening …
13th March 2019
We are more dovish than investors about the outlook for monetary policy in most developed markets. If we are right, “core” government bond yields are likely to fall, or remain very low, this year. … Monetary policy likely to keep “core” bond yields …
6th March 2019
Italy’s economy is unlikely to come out of recession in the first half of this year. Several temporary factors might lead to a small expansion in the second half of the year, but even if this happens we still think that the economy is likely to contract …
5th March 2019
The continued lack of price pressures in Switzerland will reaffirm the SNB’s dovish stance. Meanwhile, private sector activity data from Sweden for January suggest that the economy made a weak start to 2019. … Swiss CPI (Feb.19) & Sweden Priv. Sec. Prod. …
In light of the changes to our valuation weightings this quarter, many markets are closer to fair value than in our last Valuation Monitor . That said, the majority of property markets (51 out of 93) are still overvalued, with valuations against equities …
1st March 2019
In his semi-annual testimony to Congress, Jerome Powell reiterated that the Fed is deciding how and when to end its balance sheet rundown. Although some officials have indicated that it could finish as soon as this year, we doubt that this would have a …
28th February 2019
February’s euro-zone Economic Sentiment Indicator (ESI) confirmed the message from other surveys that despite weakness in the industrial sector, the overall economy is still growing. That said, the risks are skewed to the downside, with slower global …
27th February 2019
The small rise in the composite PMI for the euro-zone, from 51.0 in January to 51.4 in February, came as a bit of a relief – especially as this was the first increase in six months. However, it leaves the index consistent with quarterly GDP growth of …
22nd February 2019
With Germany having narrowly avoided recession and Italy’s downturn dragging on, policymakers at the ECB will soon have to provide more clarity about which tools they are willing to use if the economic data don’t improve. … China and Germany, another …
15th February 2019
We doubt that German and Swiss government bond yields will drop much further. But if they do fall deep into negative territory, there probably won’t be much that the ECB or the SNB will be willing or able to do. … ECB and SNB unlikely to put a floor under …
13th February 2019
The publication of macroeconomic forecasts by the European Commission is not normally a market-moving event. But the extent of the downward revisions to its GDP forecasts seemed to take the financial markets by surprise when they were published on …
8th February 2019
Economic activity finished last year on a weak note and most business surveys suggest that things did not improve in January. Italy went back into recession in the second half of 2018 and the evidence suggests that economic activity there has continued to …
6th February 2019
At the end of last year, Italy fell back into recession but Spain’s economic growth rate accelerated. We think that this divergence will continue. Next week is a quieter one for data releases; we think data for December will show a small rebound in German …
1st February 2019
With risk-free rates expected to stay low, the continued attractiveness of commercial property returns means that investment in 2019 likely to be close to last year’s record level. … Allure of property to keep investment strong in …
Weaker demand, the ongoing transition away from coal and rising supply from Russia will lead to lower European coal prices in 2019. We forecast that the price of Rotterdam coal will fall from $80 per tonne currently to $70 by end-year. … European coal …
31st January 2019
The further drop in the EC’s Economic Sentiment Indicator (ESI) in January adds to the evidence that the euro-zone economy got off to a slow start to 2019. … EC Business and Consumer Survey …
30th January 2019
The latest batch of business surveys suggest that the euro-zone economy may be stalling rather than just slowing. We think the ECB will tweak its forward guidance in March, and will at least consider more radical options soon. Meanwhile, we’re braced for …
25th January 2019
The latest ECB Bank Lending Survey shows that consumers’ and firms’ demand for credit is softening, adding to the evidence that the euro-zone economy has lost momentum. … ECB Bank Lending Survey (Q4 …
22nd January 2019
We think that government bonds in the euro-zone “periphery” will fare quite poorly in the next two years – particularly in Italy and Greece – as growth disappoints and deficits overshoot expectations; European elections raise concerns; and the ECB …
This week saw more evidence that the euro-zone economy has lost a lot of momentum. Meanwhile, the UK parliament rejected the EU Withdrawal Agreement, once again raising the spectre of a no deal Brexit. And in Greece, Prime Minister Alexis Tsipras narrowly …
18th January 2019
The euro-zone should regain some momentum in the coming months, at least compared to its dire performance at the end of last year. But we think the economy will expand by just 1% in 2019 as a whole. Demand in key export partners is set to slow further, …
With plenty of capital still waiting to be deployed and attractive returns on offer, investment in European commercial property is likely to be strong again this year. However, a swing back towards core strategies suggests that investors are increasingly …
In a busy election calendar this year, the focus will be on the rise of populist and euro-sceptic parties. Elections for the European Parliament in May are the most high profile event, but there will also be national elections in Belgium, Portugal, Greece …
17th January 2019
The euro-zone has shifted down a gear but has not (yet) gone into reverse. Italy probably experienced a technical recession last year and Germany only narrowly avoided one. More importantly, the breadth of the downturn, which affected all major countries …
16th January 2019
We think that loose monetary policy and safe-haven flows will keep the German 10-year government bond yield around its current level this year and next. Yields in most other “core” countries are also likely to remain low, although we expect them to rise a …
Sharp falls in industrial production in November last year mean that Germany and Italy may have experienced technical recessions in 2018. And GDP in the euro-zone as a whole probably increased by only around 0.2% in Q4. Meanwhile, officials at the ECB are …
11th January 2019
With interest rates likely to be structurally lower in the future, prime property yields are unlikely to return to historical levels. As such, we have re-weighted our valuation scores to exclude the comparison with the long-term average property yield. …
9th January 2019
Following on from the disappointing German industrial production data released earlier today, the drop in the EC’s Economic Sentiment Indicator (ESI) for December is yet another sign that there was a broad-based loss of momentum in the euro-zone towards …
8th January 2019
Data released this week suggest that the economy lost more momentum at the end of last year and that GDP growth in 2019 won’t be as good as in 2018. … Euro-zone economy continues to lose …
4th January 2019
Commercial property capital values will rise again in 2019, supported by an improved outlook for yields, which will, at a European level, edge slightly lower this year. However, a weakening economic backdrop will also mean that occupier market momentum …
A no deal Brexit is unlikely to provide much support for property in the rest of Europe. The negative impact on euro-zone occupier markets should be modest, but investors, rather than reallocate UK capital to continental markets, are most likely to hold …
21st December 2018
This week, Italy’s Government again showed itself to be more flexible than many had anticipated. But its fiscal problems are far from over and, in our view, public debt still looks unsustainable in the long run. Meanwhile, data released this week added to …
Scandinavian property yields are now set to mark time in 2019 before rising from 2020, despite slowing rental growth. Copenhagen industrial is our top pick for the region. Total returns will be higher in emerging Europe, as yields have more scope to fall …
20th December 2018
Following this week’s ECB meeting, and the latest data on economic growth in the currency union, the chance that the Bank raises interest rates next year has fallen. … ECB dovish as PMI confirms growth …
14th December 2018
With growth in the euro-zone slowing faster than expected and the chances of the ECB delaying its first interest rate hike increasing, property yields are now more likely to plateau next year, than rise. … Property yields to …
London office and retail property are set to produce only middling performance in the next few years, when compared to Western Europe’s other major markets. We think London’s large development pipeline will constrain rental value growth in the office …
12th December 2018
The latest data on economic activity in the euro-zone have been weak, but policymakers at the ECB will have been encouraged by the continued acceleration in wage growth. At its meeting on Thursday, the Bank looks set to confirm that it will end its net …
7th December 2018
With all of the hype around the potential impact of online retailing on industrial occupier demand, there has been a big shift in the relative pricing of industrial assets. Although rents in the UK have surged, supply-side constraints, rather than demand, …
After contracting in Q3, activity surveys suggest that Italy’s economy is on the brink of recession. Indeed, the Composite PMI was unchanged at 49.3 in November, which on past form points to GDP falling by as much as 0.3%. Whether or not the economy tips …
6th December 2018
We think that this week’s decline in Italian bond yields will be reversed before long, weighing on the economy. Meanwhile, data released this week showed that core inflation in the euro-zone edged down to just 1.0% in November. But there are still …
30th November 2018
The sharp drop in oil prices this month supports our long-held view that lower inflation will give consumer spending a boost. And we doubt that the sell-off in the equity market will do much damage to the wider economy. … Fall in oil prices to boost …
23rd November 2018
The number of European property markets that appear to be overvalued continues to rise. With prime property yields still edging lower and government bond yields higher in Q3, the majority of markets recorded a deterioration in valuation scores. What’s …
20th November 2018
The EU looks set to launch disciplinary proceedings against Italy, perhaps as soon as next week. But unless the situation in Italy escalates dramatically, the ECB is unlikely to respond. Instead, the Bank is more focused on the risks to the wider outlook …
16th November 2018
The 0.2% quarterly fall in German GDP in Q3 partly reflected temporary factors, but will still serve as a warning to the ECB to bide its time before communicating any policy normalisation. … German GDP …
14th November 2018
