Filtered by Region: Europe Use setting Europe
The latest Irish inflation figures revealed that core inflation tumbled deeper into negative territory in April, suggesting that the chance of a prolonged bout of negative inflation is growing. This should provide policymakers in the euro-zone as a whole …
21st May 2009
Surveys of German consumer sentiment have diverged markedly lately, with the EC survey pointin to very sharp falls in spending but the GfK version broadly consistent with stagnation. We think that the less pessimistic GfK survey, which is focused on …
20th May 2009
The Nordic authorities’ handling of the early 1990s banking crises has since been hailed as being close to best practice. Nonetheless, given that a global economic upturn was a key factor behind the subsequent Nordic economic recovery, merely following …
The latest RICS snapshot of global property markets offered some tentative hope that the pace of the correction in Western Europe might soon begin to moderate as improving investor demand helps to put a ceiling on yields. The survey showed no such …
19th May 2009
There was nothing in the latest euro-zone GDP releases to change materially our commercial property forecasts. If anything, however, the figures raised most concerns about the German property market, and, in particular, the industrial sector. … Latest GDP …
15th May 2009
Fiscal austerity is a thing of the past. However, in its just-released Regional Economic Outlook for Europe the IMF stressed that, without a credible and sustainable strategy to ensure fiscal sustainability, ballooning budget deficits will increase …
13th May 2009
The ‘bad bank’ plan approved by the German Cabinet today goes a bit further towards solving banks’ problems than measures existing elsewhere in the euro-zone. But while the plan should improve banks’ liquidity, it does little to reduce uncertainty related …
While the latest OECD leading indicators brought further signs of the ‘green shoots’ of recovery in some euro-zone economies, Germany continues to suffer from the weakness in global trade. Until that changes, the euro-zone recovery will be muted. … The …
12th May 2009
Although euro-zone retail sales have dropped lately, other types of spending appear to have held up relatively well. Sadly, it seems unlikely that this trend lasted into the first quarter and we expect total consumer spending to have contracted sharply. …
In the early stages of the correction, property yields in Oslo saw some of the largest rises of any European city. But the rate of increase slowed sharply in 2009Q1. However, it is too soon to interpret that as a sign that the upward shift in Norwegian …
8th May 2009
The ECB continues to lag behind. Although it delivered a 25bp interest rate cut today, the unconventional policy measures also announced look very timid compared to those already adopted by other central banks. … ECB disappoints on unconventional …
7th May 2009
Our forecasts envisage that, in general, rental values in the euro-zone will hold up better through the recession in retail than in industrial markets. But the same will not be true in emerging Europe. There, we expect retail rental values to fall as far, …
The old adage goes that if you ask ten economists their views on something you get ten different answers. But there is one topic where nearly all economists agreed some years back: the prognosis for Europe’s sick man, Italy, is terminal. However, without …
April’s business surveys provided some tentative signs that the euro-zone economy may start to contract at a less rapid pace in Q2. But any improvement will be from a very low base. Indeed, the latest news suggests that the economy may have contracted by …
6th May 2009
Today’s further cut in interest rates by the Norges Bank has brought rates close to their likely trough. But with the risk of deflation remaining pretty small and the economy still on track for one of the mildest recessions in Europe, the Bank is unlikely …
The Fed’s latest Senior Loan Officer Survey suggested that constraints on the supply of credit in the US have eased in the second quarter. (See our US Economics Update “Fed’s survey suggests credit crunch has eased”, 4th May.) Is the credit crunch easing …
5th May 2009
In some sectors, most notably the office market, commercial property yields stabilised in Q1, or at least rose more slowly. But we doubt the upward yield shift is over. In any event, the rental recession, which gathered pace in Q1, will ensure that …
1st May 2009
The ECB is almost certain to cut interest rates by 25 basis points to 1% this month, where they should remain for some time. But after last month’s hints that further unconventional policies could be announced at this meeting, the key interest will be in …
30th April 2009
The severe impact on Europe’s exporters of the outright collapse in global demand and tradeflows will cause most economies in the region to contract very sharply in 2009. Indeed, most will now see even deeper downturns than that likely in the US, with the …
29th April 2009
Initial estimates suggest that the Spanish economy may not have contracted quite as rapidly as some of the other major euro-zone economies in Q1. However, the housing market slump and the rapidly deteriorating labour market suggest that the Spanish …
The latest euro-zone money data suggest that the ECB’s liquidity provisions are doing nothing to boost broad money growth in the region. This will increase the pressure on the ECB to announce bold unconventional policy measures to encourage banks to lend …
Hopes that Europe might weather the global economic storm relatively well have been shattered as the region has followed the US into an extremely severe recession. Sadly, a reliance on exports will almost certainly mean that the euro-zone does lag behind, …
28th April 2009
The Financial Times recently reported that, according to internal analysis prepared for the Fed’s last policy meeting, the ‘ideal’ interest rate in the US should be minus 5%. The analysis was based on the so-called Taylor rule, which is often used as a …
Dublin aside, prime commercial property rental values have fallen further in Barcelona and Madrid than in any other major euro-zone city. That seems consistent with the dramatic rise in Spanish unemployment, which jumped by more than 800,000 persons in Q1 …
The Spanish unemployment rate rose at breakneck speed in Q1, suggesting that household spending is set to continue to plunge this year. Accordingly, we still think that the consensus forecast of a 2.9% fall in GDP in 2009 looks too optimistic. … Mounting …
24th April 2009
Real estate equity markets currently appear to be anticipating that commercial property capital values will fare worse in Germany and Italy this year than in France and the Netherlands. Those broad rankings are consistent with our own top-down views on …
With the euro-zone set to enter its worst recession in the post-war period, concerns about the prospect of a member state defaulting on its debt have rocketed and even prompted speculation of a euro-zone break-up. But while there is no doubting that the …
23rd April 2009
The euro-zone 2008 budget deficit figures show that the health of the public finances in parts of the region has deteriorated at an alarming rate. Nonetheless, we think that the state of the public finances in the region is unlikely to worsen to the point …
22nd April 2009
The German Government’s plans for further measures to support the banking sector might sound broadly encouraging, particularly as banks there have so far not suffered as much as those elsewhere. But it is disappointing that no firm details will be …
21st April 2009
The Swedish Riksbank’s decision to commit to a prolonged period of low interest rates to help kick start the economy is clearly a step in the right direction, but this alone may not be enough. We think that the Bank will soon be forced to follow the lead …
To date, German property yields have proved remarkably resilient to the forces pushing property yields sharply higher in the rest of Europe. But, in our view, German property yields do not reflect the increasingly dire outlook for the economy and the …
17th April 2009
Of the four main financial hubs of Europe, we think it is Paris that will deliver the best total returns for offices. An annual average of around minus 10% over the next two years will be better than offices in Frankfurt (-14%), Zurich (-17%) and London …
15th April 2009
We have cut our commercial property forecasts to reflect the increasingly gloomy outlook for noneuro- zone European economies. Capital values are likely to fall by 40% from peak to trough in most non-euro-zone markets and by more than 50% in the majority …
8th April 2009
As well as facing a deep and painful recession, occupiers in emerging Europe have been hit by falling currencies, increasing the burden of rental payments denominated in euros or dollars. While there is unlikely to be a mechanical link, these currency …
6th April 2009
Although the ECB’s 25bp interest rate cut was smaller than expected, the decision appears to have reflected a desire to maintain the corridor between the official rate and deposit rates rather than a reluctance to further stimulate the economy. What’s …
2nd April 2009
The downturn in the euro-zone labour market is gathering pace. Another very sharp rise in unemployment in February took the total increase so far to over 2 million. With 1.6 million of that pick-up occurring in just the past six months, conditions are …
1st April 2009
February’s dreadful Spanish retail sales figures have dashed any hopes that the recent sharp falls in inflation and mortgage payments would lead household spending to stabilise at the start of the year. With conditions likely to get worse before they get …
31st March 2009
We have cut our euro-zone commercial property forecasts. We now expect capital values in most markets to fall by between 30% and 40% from their peak, with the bulk of those falls being seen by the end of this year. Spain and Ireland are likely to see …
With the euro-zone recession still gathering pace, we see the ECB cutting interest rates by another 50 basis points to 1.0% this month. Indeed, it should not be long before rates reach 0.5%. But the key issue is what indications the Bank will give that it …
26th March 2009
The latest euro-zone money supply figures further support the view that the ECB’s injections of short-term liquidity into the banking sector will not be sufficient on their own to encourage banks to increase their lending into the wider economy. … …
The Norges Bank’s decision to cut interest rates by a further 50 basis shows that it remains committed to preventing a major economic downturn. But with the economy set to experience a much milder recession that its European neighbours, the Bank is …
25th March 2009
The Norges Bank’s decision to cut interest rates by a further 50 basis shows that it remains committedto preventing a major economic downturn. But with the economy set to experience a much milderrecession that its European neighbours, the Bank is unlikely …
The Federal Reserve’s decision to embark on an even bolder program of quantitative easing has left the ECB apparently lagging still further behind other central banks in tackling the economic crisis. We see no insurmountable barriers to similar action in …
19th March 2009
At first sight, the latest industrial production figures from Italy suggest that the sector may be weathering the global economic downturn rather better than some of the other major euro-zone economies. But we think that this largely reflects a number of …
18th March 2009
The SNB’s decision to cut interest rates to 0.25%, provide more liquidity to the banking sector, intervene in currency markets and purchase bonds from the private sector, pushes it towards the top of the table of central banks acting aggressively to stem …
12th March 2009
